SMM Nickel Morning Comment

On November 7, the most active SHFE nickel contract prices opened at 143110 yuan/mt and closed at 141450 yuan/mt, a decrease of 1390 yuan/mt from the closing price of the previous trading day. The trading volume increased by 16259 lots, and the open interest increased by 7752 lots.

If prices drop overly significantly, bulls will enter the market. This, combined with the retreat of shorts, will push up nickel prices. On the macro front, after the unemployment rate data released by the Federal Reserve last Friday was lower than expected, the current weakness in the U.S. job market will provide some support for ending the process of the Federal Reserve's interest rate hike. However, yesterday's hawkish speech by Federal Reserve officials led to increased market expectations for a December Federal Reserve interest rate hike. From a fundamental perspective, the trend of pure nickel inventory accumulation remains unchanged, downstream demand has not yet improved, and spot market transactions were still weak. However, due to the positive macro sentiment, it is expected that nickel prices may rebound slightly in the future.