SMM Morning Comments (Aug 14)

Published: Aug 14, 2018 09:39

Save

SMM Morning Comments

SHANGHAI, Aug 14 (SMM) –

Copper: Copper prices traded rangebound overnight. LME copper moved at $6,100-6,200/mt and was under pressure from a strong dollar. The SHFE 1810 contract came off from early gains and closed at 49,700 yuan/mt. Open interests for SHFE copper contracts remained at some 600,000 lots. We expect LME copper to trade at $6,110-6,160/mt today with the SHFE 1810 contract at 49,500-50,000 yuan/mt. Spot premiums are seen at 30-70 yuan/mt.

Aluminium: LME aluminium rebounded from a low of $2,070/mt and closed at $2,080/mt on Monday. The metal hovered within a range of $25/mt for most of the day. We expect it to continue such rangebound pattern today with a trading range of $2,060-2,100/mt. The SHFE 1810 contract lost all its early gains from a high of 14,740 yuan/mt to a low of 14,635 yuan/mt before it recovered some losses and closed at 14,660 yuan/mt overnight. We expect the contract to trade at 14,600-14,800 yuan/mt today. Spot discounts are seen at 40-0 yuan/mt.

Zinc: LME zinc plunged past the lower Bollinger band and closed at $2,467/mt on Monday due to a strong dollar and a 14,800-mt increase in LME inventory. We expect it to trade below the lower Bollinger band today with a trading range of $2,470-2,520/mt. The SHFE 1810 contract opened lower and fell overnight, settling at 20,850 yuan/mt, as shorts significantly added their positions. As some shorts may take profits, the contract is likely to consolidate at 20,850-21,350 yuan/mt today.

Nickel: LME nickel lost all the gains it made last week and closed at $13,535/mt on Monday. The SHFE 1811 contract overnight plummeted past the 20-day moving average to 111,330 yuan/mt after its initial, mild gains. It then recovered some losses and closed at 112,030 yuan/mt. We expect nickel prices to continue their weak performance today. LME nickel is likely to hover around $13,600/mt and the SHFE 1811 contract is likely to trade at 112,000-113,800 yuan/mt. Spot prices are seen at 112,000-114,000 yuan/mt.

Lead: LME lead regained the ground at $2,100/mt, hitting a high at $2,121/mt, and closed at $2,103/mt on Monday. While the metal stemmed its recent tumbles, pressure is still lingering at several moving averages above. We expect it to consolidate around $2,100/mt today with a trading range of $2,090-2,120/mt. The SHFE 1809 contract reversed its early losses before it fell again and finished the overnight session lower at 18,160 yuan/mt. Three consecutive days of declines sent the contract towards the 18,000 yuan/mt level again. We expect it to trade at 18,000-18,250 yuan/mt today. Spot prices are seen at 18,100-18,250 yuan/mt in the Shanghai market.

Tin: LME tin traded under pressure and closed at a low of $19,325/mt as the US dollar strengthened to a 14-month high. Further downward room is seen in the short run. Support will be at $19,000/mt. The SHFE 1809 contract also fell, below all moving averages on a stronger US dollar and its dipping LME counterpart. The contract is likely to weaken further but with support at 142,500 yuan/mt.

Morning comments Futures movement

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.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

15 hours ago

"Premier Li Qiang Leads State Council Meeting on Enhancing Effective Investment, Boosting Economic Growth"

Premier Li Qiang presided over an executive meeting of the State Council to study policy measures for promoting effective investment. The meeting noted that promoting effective investment plays an important role in stabilizing economic growth and strengthening momentum for development. It is necessary to innovate and improve policy measures, and intensify efforts to enhance the efficiency of utilizing funds such as central budget investments, ultra-long-term special treasury bonds, local government special bonds, and new-type policy-based financial instruments. In conjunction with formulating and implementing the 15th Five-Year Plan

15 hours ago

"Guided by Xi Jinping Thought, Implement 20th CPC Congress Spirit, Apply New Development Philosophy...

Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we will thoroughly implement the spirit of the 20th National Congress of the Communist Party of China and the plenary sessions of the Party’s 20th Central Committee, fully and faithfully apply the new development philosophy, strengthen top-level design, build computing power interconnection nodes oriented toward national hub periods, major strategic regions, and key industries, establish a system of computing power interconnection nodes, improve the efficiency and service level of public computing power resources, and promote high-quality development of computing power.

15 hours ago

Indirect Iran-US Nuclear Talks in Muscat Show Progress, Omani FM Mediates Tense but Efficient Discussions

After intensive indirect consultations, the new round of nuclear talks between Iran and the US in Muscat, the capital of Oman, has achieved phased progress. It is reported that during this round of talks, the Iranian and US delegations did not meet directly. Instead, Omani Foreign Minister Badr acted as an intermediary, conveying a series of core proposals, strategic concerns, and policy positions to the other side. The atmosphere at the talks was tense yet efficient. According to preliminary on-site assessments, although both sides continue to negotiate over specific terms, they have reached a consensus on the key objective of "continuing dialogue."

15 hours ago