SHFE zinc opened lower in the night session, expected to consolidate in the short term [SMM zinc morning comment]

SMM September 15:

Overnight, LME zinc opened at $3,867/mt, initially touching a high of $3,873.5/mt before drifting lower throughout the session. Near the end of trading, LME zinc dipped to a low of $3,766.5/mt, then rebounded slightly into the close, ultimately settling down at $3,804.5/mt, a decline of $59/mt or 1.53%. Trading volume decreased to 18,287 lots, while open interest rose by 691 lots to 265,000 lots. Overnight, LME zinc formed a bearish candlestick, with support from the 40-day moving average below. Although the LME zinc 0-3 backwardation structure stood at $138.72/mt, indicating persistent structural risks, the US dollar index strengthened on safe-haven demand and expectations for US Fed interest rate hikes, weighing on the broader base metals complex and keeping LME zinc on a downward trajectory.

Overnight, the most-traded SHFE zinc 2611 contract opened at 25,960 yuan/mt, then drifted higher after the open, touching a low of 25,960 yuan/mt in early trading and a high of 26,250 yuan/mt near the close, ultimately settling down at 26,210 yuan/mt, a decline of 125 yuan/mt or 0.47%. Trading volume decreased to 52,752 lots, while open interest fell by 1,481 lots to 126,000 lots. Overnight, SHFE zinc formed a bullish candlestick, with support from the lower Bollinger Band. Dragged lower by LME zinc's decline, SHFE zinc opened lower in the night session, but the tight ore supply situation on the fundamentals side showed no improvement, continuing to provide some support for SHFE zinc. SHFE zinc rebounded from its lows and is expected to maintain a consolidation pattern in the short term.

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