SHFE and LME both break below the middle Bollinger Band; SHFE lead closes down 0.53%, pulling back to the 16,000 level [SMM Lead Morning Report]

SMM, September 14:

Last Friday, the LME lead 3M contract drifted lower on September 11, opening at $1,901.0/mt and closing at $1,892.5/mt, down $8.0/mt or 0.42% from the previous trading day's closing price. It traded in a range of $1,891.0-1,904.0/mt throughout the day, with volume of 5,692 lots, a decrease, and open interest of 171,247 lots, up 1,738 lots, forming a bearish daily candlestick.

Last Friday, the SHFE lead 2610 contract opened at 16,120 yuan/mt in the night session. After briefly shooting up to 16,135 yuan/mt, it drifted lower, hitting an intraday low of 16,025 yuan/mt around 21:30, then moved sideways at low levels, and finally closed at 16,050 yuan/mt, down 85 yuan/mt or 0.53% from the previous trading day's closing price. Night session volume was 32,116 lots, with open interest of 63,249 lots, up 304 lots, forming a bearish daily candlestick.

Overall, last Friday SHFE and LME weakened in tandem with highly synchronized pace: both LME lead and SHFE lead were pressured by bearish position building and both broke below the Bollinger middle band. In addition, the SHFE lead 2609 contract will enter delivery tomorrow (September 15), so attention should be paid to warrant cancellations and flows under the delivery of the old contract, as well as the pace of capital shifting and contract rollover to the most-traded 2610 contract.