Rubber gains for second consecutive day after the free fall

AHMEDABAD (Commodity Online): Rubber prices have slide about 26% from its all-time high of around Rs 24,778 per 100 kg before few weeks on NMCE. The fall cached fire after Japan’s quake but the crash was mainly due to speculation in the commodities market.
Earthquake which struck Japan and spurred a nuclear crisis will have limited impact on global demand because there is no damage to plants owned by major firms such as Bridgestone Corp and Michelin , the Association of Natural Rubber Producing Countries said on Tuesday
The closure of a handful of auto-tire plants in the country's northeast region for a few days cannot impact on the commodity's global demand in a significant way "If at all there is any marginal impact, it will be for a short-term only."
Japan accounts for seven per cent of the global demand for natural rubber. India’s auto demand has been robust and this is expected to sustain. Rubber prices nearly doubled over the last one year but due to fears of lower global demand for at least for two-three quarters amid Japanese crisis led to traders offloading stock rapidly, which brought down the price.
Once Japan will start rebuilding there will be a huge demand for natural rubber and prices may rebound.
Yesterday Rubber April contract at NMCE opened near to its low but gave smart recovery on all arround buying and closed on buyer’s circuit of 20570. Rubber made hammer on daily chart and today even it is on buyers cap which gave the confirmation of its long term bullish trend .
“Technically, Long term traders are advised to maintain buying positions with the stop loss of recent low of 18400.” said Bharti Navlani, technical analyst with Commodity Online.