SMM Lead Price Forecast (Jan. 16-20)

Price Review & Forecast 01:25:23PM Jan 16, 2012 Source:SMM

SHANGHAI, Jan. 16 (SMM) -- The meeting on last Monday between Germany and France did not produce any surprises, so market responses were neutral. Later, markets focused on talks between German Chancellor Angela Merkel, German Finance Minister Wolfgang Schaueble, and IMF President Lagarde, which involved improving fiscal integrity in the euro zone. Finally, the European Central Bank decided to keep bench mark interest rates unchanged at 1%, but hinted at possible interest rate adjustments. In addition, auctions of Italian and Spanish government bonds last Thursday were successful, causing base metal prices to rally again. Strong rebounds in China’s stock markets and the steady decline in China’s CPI also boosted LME nickel prices. It is expected that LME nickel prices will now fluctuate after the positive news is digested by markets.

Technically speaking, Relative Strength Index (RSI) daily chart suggested a buying indication, and the weekly chart plotted near 50. The monthly, weekly charts of Bollinger bands had downward trend, but the daily chart indicated an upward price trend. The weekly chart of Bollinger bands also indicated resistance at USD 19,850/mt and USD 20,800/mt. Technical indicators suggest LME nickel prices should have upward momentum in the short term, but will fluctuate in the medium-to-long term. LME nickel prices will meet resistance at USD 19,850/mt, USD 20,000/mt and USD 20,850/mt, but find support at 20-day moving average of USD 19,000/mt and at the 10-day moving average of USD 18,600/mt.

In domestic nickel spot markets, spot nickel prices were already considered high following the two price adjustments by Jinchuan Group. Many downstream producers will close next week for the Chinese New Year holiday, so spot prices should remain in the RMB 135,000-139,000/mt range in the coming week.

 

SMM Lead Price Forecast (Jan. 16-20)

Price Review & Forecast 01:25:23PM Jan 16, 2012 Source:SMM

SHANGHAI, Jan. 16 (SMM) -- The meeting on last Monday between Germany and France did not produce any surprises, so market responses were neutral. Later, markets focused on talks between German Chancellor Angela Merkel, German Finance Minister Wolfgang Schaueble, and IMF President Lagarde, which involved improving fiscal integrity in the euro zone. Finally, the European Central Bank decided to keep bench mark interest rates unchanged at 1%, but hinted at possible interest rate adjustments. In addition, auctions of Italian and Spanish government bonds last Thursday were successful, causing base metal prices to rally again. Strong rebounds in China’s stock markets and the steady decline in China’s CPI also boosted LME nickel prices. It is expected that LME nickel prices will now fluctuate after the positive news is digested by markets.

Technically speaking, Relative Strength Index (RSI) daily chart suggested a buying indication, and the weekly chart plotted near 50. The monthly, weekly charts of Bollinger bands had downward trend, but the daily chart indicated an upward price trend. The weekly chart of Bollinger bands also indicated resistance at USD 19,850/mt and USD 20,800/mt. Technical indicators suggest LME nickel prices should have upward momentum in the short term, but will fluctuate in the medium-to-long term. LME nickel prices will meet resistance at USD 19,850/mt, USD 20,000/mt and USD 20,850/mt, but find support at 20-day moving average of USD 19,000/mt and at the 10-day moving average of USD 18,600/mt.

In domestic nickel spot markets, spot nickel prices were already considered high following the two price adjustments by Jinchuan Group. Many downstream producers will close next week for the Chinese New Year holiday, so spot prices should remain in the RMB 135,000-139,000/mt range in the coming week.