SMM Morning Comments (Jan 30)

Published: Jan 30, 2018 09:26

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SHANGHAI, Jan 30 (SMM) –

Copper: The latest Commitments of Traders report published by the Commodity Futures Trading Commission (CFTC) showed that investors have reduced their long positions following a price drop earlier last week. We see pressure for copper futures prices as Chinese consumptions dwindle ahead of Chinese New Year. The LME contract is expected to trade at $7,070-7,120/mt today while the SHFE 1803 is expected at 53,000-53,600 yuan/mt. Spot discounts are set to go deeper at 220-150 yuan/mt.

Aluminium: The five-day, 10-day and 20-day moving averages have started to form pressure for the LME aluminium contract, which we expect to trade at $2,210-2,260/mt today. SHFE aluminium, on the other hand, is likely to follow the downward trend and trade at 14,500-14,700 yuan/mt. Spot discounts are seen at 170-130 yuan/mt.

Zinc: We see support for zinc prices both on the macroeconomic and fundamental fronts, and the rebound in US dollar had only a small impact. LME zinc is expected to trade at $3,525-3,575/mt today with the SHFE contract at 26,750-27,200 yuan/mt.

Nickel: The fundamentals of nickel remained little changed with weak downstream consumption. The SHFE 1805 contract is set to trade at 104,200-106,000 yuan/mt with spot prices at 103,500-105,300 yuan/mt.

Tin: LME tin may trade towards the $24,000 level if it broke through the resistance at $22,000/mt. We expect the SHFE contract to trade at 150,000-152,000 yuan/mt today and give support to the physical market, which is seen at 148,000-149,500 yuan/mt.

Lead: Supply tightness remains in the lead market but demand was sluggish due to the approaching Chinese New Year holiday. We see spot prices lower today at 19,500-19,650 yuan/mt today.

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copper aluminium lead zinc tin nickel

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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