Overnight, base metals generally fell, with LME zinc recording five-day losing streak [SMM Zinc Morning Comment Aug 8]

Overnight, the Bank of Japan turned dovish again! Japan's new top foreign exchange official warned that their stance on forex intervention remains unchanged; participants in the US Fed's reverse repo operations fell to the lowest since June 2021; the White House said a ceasefire agreement in Gaza is close to being reached; Iran stated it is engaging in psychological warfare with Israel and has not taken military action; a poll showed that the competition between US Vice President Harris and former President Trump is very close; the PBOC paused gold purchases for the third consecutive month, with foreign reserves remaining above $3.2 trillion for eight consecutive months; the Ministry of Finance and the Ministry of Emergency Management pre-allocated 465 million yuan again to support provinces severely affected by disasters in emergency rescue and relief efforts; the General Administration of Customs: In the first seven months, China's import and export scale hit a record high for the same period in history; Shenzhen's total service trade import and export in 2023 recorded $130.07 billion, a record high, up 20% YoY.

Overnight, LME zinc opened at $2,602/mt. After initial long-short tussles, LME zinc quickly touched $2,602.5/mt. Subsequently, with increased short positions, LME zinc's focus shifted below the daily moving average, reaching a low of $2,549/mt during European trading hours. Later, with longs entering the market, LME zinc's focus moved back near the daily moving average, recording a V-shaped reversal. During the night session, LME zinc's attempt to test lower levels failed again, and it returned to consolidate around the daily moving average, finally closing down at $2,563/mt, down $49/mt, a drop of 1.88%. Trading volume decreased to 10,982 lots, and open interest increased by 168 lots to 223,000 lots. Overnight, LME zinc recorded five consecutive declines, with the daily K-line focus shifting downward. Overnight, LME inventory decreased by 3,450 mt to 244,375 mt, a drop of 1.39%, with LME inventory recording a reduction. Overnight, a stronger dollar pressured base metals, and concerns about economic recession persisted, leading to weak adjustments in LME zinc.

Overnight, the main SHFE zinc 2409 contract opened higher at 21,900 yuan/mt. After quickly touching 21,990 yuan/mt initially, SHFE zinc fluctuated downward to a low of 21,820 yuan/mt due to long positions entering and short positions closing. Subsequently, with longs entering at lower levels, SHFE zinc's focus moved above the daily moving average. By the end of the session, it dropped slightly, finally closing down at 21,865 yuan/mt, down 140 yuan/mt, a drop of 0.64%. Trading volume decreased to 61,094 lots, and open interest decreased by 350 lots to 82,197 lots. Overnight, SHFE zinc recorded a small bearish candlestick, with the 5-day moving average forming resistance above. Zinc prices fell below the support level of 22,000 yuan/mt, with weak macro sentiment and insufficient momentum for zinc price rebound during the off-season for consumption.