SHANGHAI, Jan. 14 (SMM) -- SHFE aluminum prices dropped to 5% daily trading limit after opening, and dipped to RMB 17,250/mt, but later moved up steadily, and SHFE three-month contract aluminum prices hit the highest level of RMB 17,640/mt, and closed at RMB 17,400/mt, with an intraday drop of 4.13%. Positions of SHFE three-month aluminum contract declined by 26,780 lots, and positions of SHFE 1005 aluminum contract declined by 5,632 lots, and SHFE 1005 aluminum contract declined by 4.24%, and closed at RMB 17,490/mt, indicating the resistance at RMB 17,500/mt.
In the spot aluminum market, aluminum prices received support at RMB 17,000/mt yesterday, and cargo-holder confidence improved as SHFE aluminum prices ended its downward trend. Spot discounts narrowed to RMB 50-0/mt from previous levels of RMB 100-200/mt, with traded prices moving in the RMB 17,100-17,130/mt range. No sell-offs were reported in the market, and market players remained optimistic toward future aluminum prices given solid support from aluminum market fundamentals. If downstream consumers confirm that aluminum prices still face solid support at RMB 17,000/mt after corrections, they will hold higher interest in purchases at lower prices. Aluminum prices will undergo downward corrections in the short term since prices advanced too fast in the RMB 17,000-17,350/mt range.
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