Speculators raised positions in mentha oil futures due to an uptick in demand from the consuming industries against limited supplies from key producing regions.
“Overall, mentha oil has been in a bullish trend since last week. The commodity breached the Rs 1,280 level on the upside and sustained above that due to a rise in demand from consumer industries in the spot market. However, overall fundamentals for the commodity are still looking weak,” said Romesh Tiwari, Head of Research, CapitalAim.
Around 11:55 am, MCX Mentha Oil traded at Rs 1,306.65 a kg, up by Rs 20.45. Technical charts looked strong and the RSI on the daily chart was placed at 57.73 levels on the daily chart on Tuesday around 10:00 am (IST).
“August futures sustained above Rs 1,280 level. Traders and investors should go for ‘buy on dips’ in the commodity with strict stop loss, as fundamentals for the commodity are still weak amid expectations of higher mentha plantation in major producing regions due to lucrative returns leading to consistent adequate supplies in the spot market even as export demand remained weak,” Tiwari said.