LME three-month nickel is trending lower within a defined range. The 50-day moving average at $17,200 has acted as support twice in the past three weeks, but each bounce was shallower than the last. The 200-day MA at $18,500 is the key resistance above, which has not been tested since mid-May.
The RSI at 45 is in mildly bearish territory, below the 50 neutral level. The MACD is below the signal line and the histogram bars are printing red, confirming bearish momentum. The ADX at 22 suggests a weak trend, consistent with range-bound price action.
The $17,000 level is the critical support. A daily close below this level would likely trigger stop-loss selling and a rapid move toward the April low of $16,200. Below $16,200, the next major support is the February low of $15,500. The medium-term trend is clearly bearish.
Open interest on LME nickel has risen 5% over the past month to 195,000 lots, suggesting new shorts are being added on rallies. The CFTC positioning data shows managed money is net short 3,000 lots, consistent with the bearish technical picture. This is a reversal from the net long position held in early Q2.
The nickel chart favors downside risk. Buyers should delay coverage and buy dips toward $17,000 or below. If $17,000 breaks, wait for $16,200 before layering in hedges. Use options strategies: consider buying LME put spreads at $17,000/$16,000 strike to protect physical inventory value.