SHANGHAI, Sep 20 (SMM) –
Copper: When traders digested worries over China-US trade dispute, LME copper failed to stand firm above the 60-day moving average overnight after rising to a high of $6,145/mt. Open interests declined 5,493 lots to 281,000 lots. The SHFE 1811 contract fluctuated around the daily moving average and closed at 49,370 yuan/mt. We retain our view that LME copper will trade robustly in the short run and to test pressure at the 60-day moving average today. Spot premiums are expected at highs of 290-330 yuan/mt today.
Aluminium: LME aluminium slid to the lowest of the week at $2,015/mt during the European trading session. With support at the five-day moving average, it settled at $2,030/mt with open interests falling 12,647 lots. The SHFE 1811 contract rebounded after dipping to a low of 14,490 yuan/mt. It is likely to trade at 14,480-14,700 yuan/mt today with its LME counterpart trading at $2,020-2,070/mt. Spot offers are set at a discount of 30 yuan/mt to a premium of 30 yuan/mt.
Zinc: LME zinc broke resistance at the 20-day moving average and rose above the Bollinger middle band, with support at the daily moving average. It may attempt to stand firm at highs and to trade at $2,400-2,450/mt today. High demand, tight supply provided part of the upward momentum for the SHFE 1811 contract, which jumped to a high of 21,650 yuan/mt. However, resistance was seen at the Bollinger upper band. The contract is expected to trade at 21,300-21,800 yuan/mt today.
Nickel: A four-year low LME nickel inventory buoyed LME nickel price to a high of $12,620/mt overnight, while continued inflow of imports weighed on the price of SHFE 1811 contract. We expect LME nickel to consolidate around $12,450/mt today with the 1811 contract trading at 102,500-104,000 yuan/mt. Spot prices are set at 102,500-109,000 yuan/mt today.
Lead: LME lead plummeted past the five-, 10- and 20-day moving averages to $2,011.5/mt on Wednesday after WBMS said lead was oversupplied by 4,500 mt in January-July. We expect it to consolidate today. The weak LME lead dragged its SHFE counterpart to 18,335 yuan/mt before bargain-hunters buying pushed up the 1811 contract above the daily moving average. SHFE lead remained rangebound at high levels. As its moving averages expanded upwards, an upward track looms if the contract registers substantial gains in the short term.
Tin: LME tin mostly hovered around short-term moving averages overnight and settled at $18,900/mt. We expect it to receive support at the $18,600/mt and resistance at $19,300/mt. The SHFE 1901 contract inched up near closing and settled at 144,700 yuan/mt, with continued pressure at the 20-day moving average. It will remain its rangebound trend with resistance at 145,500 yuan/mt today.