SMM Evening Comments (Apr 12)

SHANGHAI, Apr 12 (SMM) – Nonferrous metals futures were weaker for the most part except for SHFE nickel. Zinc plunged nearly 3.6%, copper lost over 1%, tin fell almost 1%, while aluminium and lead slipped.

The ferrous complex also closed lower, except for hot-rolled coil. Coking coal slid nearly 4%, coke dropped 3%, iron ore fell nearly 1%, and rebar edged down.

Copper: SHFE copper was dragged down by a plummeting SHFE zinc today. The 1805 copper contract mostly traded between the five- and 20- day moving averages, with support at the 10-day moving average. We see it testing support at 50,500 yuan/mt tonight.

Aluminium: SHFE aluminium traded around five-day moving average in the morning with pressure from shorts. As longs entered in the afternoon, the contract closed at 14,325 yuan/mt. We expect it to test the support of five-day moving average tonight.

Zinc: The SHFE 1806 contract slumped below the Lower Bollinger Band and closed at 23,625 yuan/mt today after it lost close to 1,000 yuan/mt. With continuous pressure from shorts, it is likely to trade rangebound at the current level tonight.

Nickel: SHFE nickel hit a low at 100,970 yuan/mt in the morning but regained losses in the afternoon and closed at 102,150 yuan/mt. With a capital inflow of more than 115 million yuan today, nickel is expected to stay firm tonight. Eyes are also on US weekly initial jobless claims tonight.

Lead: SHFE lead closed slightly lower, following six consecutive days of decline. We expect it to continue to weaken tonight with support is seen at the 18,350 yuan/mt level.

Tin: The SHFE 1805 contract fell below all moving averages today with further downward room in the short term. We see support at 140,000 yuan/mt.

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