SHFE Zinc Center Shifts Higher as Tug-of-War Between Longs and Shorts Continues [SMM Zinc Futures Brief]

SMM May 20: The most-traded SHFE zinc 2606 contract opened at 24,500 yuan/mt. After the opening, bulls reduced their open interest, and the center of SHFE zinc moved lower, dipping below 24,400 yuan/mt. Subsequently, bears reduced their open interest, and SHFE zinc rose steadily, touching a high above 24,745 yuan/mt near the close, ultimately settling up at 24,730 yuan/mt, gaining 225 yuan/mt or 0.92%. Trading volume increased to 14,340 lots, while open interest decreased by 494 lots to 59,621 lots. SHFE zinc posted a bullish candlestick today. Driven by gains on LME, SHFE zinc continued to rise, but weak end-use demand in China, coupled with a sustained increase in domestic zinc inventory, exerted some downward pressure on prices. Meanwhile, the tight ore supply also provided some support, resulting in a tug-of-war between longs and shorts. SHFE zinc is expected to hover at highs in the short term.