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SMM Brief Review – 2011/8/29 Aluminum Futures: Aluminum Price Stagnates with Reserve Base Spread
Aug 29,2011 16:52CST
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Source:SMM
Most active SHFE 1111 aluminum contract closed slightly higher by RMB 5/mt or 0.03% at RMB 17,370/mt. Positions fell by 2,080 lots and transactions fell to more than 20,000 lots.

SHANGHAI, Aug. 29 (SMM) – After opening higher at RMB 17,380/mt, most active SHFE 1111 aluminum contract outperformed surrounding base metals contracts and hit an intraday high of RMB 17,395/mt on August 29th. However, due to market concerns towards liquidity pressure caused by a spread of base of reserve to include margin deposits, the contract quickly erased earlier gains to narrowly struggle at RMB 17,365/mt. Finally closed price was RMB 17,370/mt, slightly up by RMB 5/mt or 0.03% from previous trading day. Positions of the contract fell by 2,080 lots due to profit-taking at the tail of trading. Transactions turned quiet during the day with only more than 20,000 lots reported with closed LME and strong resistance at RMB 17,400/mt given capital tightening expectations. SMM expects most active SHFE aluminum contract to stagnate at the 60-day moving average in the short term while gathering upward momentum.

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