SMM Brief on SHFE Lead Futures (2013-6-18)

SHANGHAI, Jun. 18 (SMM) – SHFE 1307 lead contract price became the most active contract on June 18, and opened higher at RMB 13,990/mt, with support at the 20-day moving average. Prices were resilient due to the falling SHFE lead inventories and moved between RMB 13,970-13,985/mt. However, prices for the most active contract dropped RMB 20/mt at the tail of trading as both shorts and longs cut positions to finally settle at RMB 13,950/mt, down RMB 15/mt. Trading volumes for SHFE 1307 lead contract increased 80 lots to 140 lots, while positions fell 106 lots to 1,548 lots. The Shanghai/LME lead price ratio was 6.64 as of 15: 00, up from the 6.59 a day earlier. The depressed demand could not help bolster lead prices, but support from moving averages was strong. Lead prices are expected to keep vacillating before the Fed decides whether to terminate the QE.