SMM Evening Comments (Oct 26)

Price Review & Forecast 05:33:37PM Oct 26, 2018 Source:SMM

SHANGHAI, Oct 26 (SMM) – SHFE nonferrous contracts mostly dipped while the ferrous complex extended their upside trend across the board on Friday.  

SHFE nickel led losses and fell 2.45%, zinc slid 1.06%, aluminium dipped 0.35%, tin lost 0.22%, while copper went flat, and lead grew 1.28%. 

Iron ore surged 1.22%, rebar rose 1.15%, coking coal grew 1.08%, coke increased 0.12%, and hot-rolled coil gained 0.08%.    

Copper: The SHFE 1812 contract lost support at the Bollinger middle band as exiting longs lowered it to an intraday low of 49,720 yuan/mt. It settled at 49,750 yuan/mt with open interest shrinking 2,268 lots. The SHFE 1901 contract gained 3,084 lots in open interest today. With pressure at the five-day moving average and an extended MACD green line, the 1812 contract will test support at 49,500 yuan/mt tonight. 

Aluminium: Macroeconomic pessimism and a strong US dollar index weighed on the SHFE 1812 contract, which extended its decline in the afternoon to a low of 14,125 yuan/mt. While most base metals lost today, the contract registered a relatively smaller drop of 0.35% and settled at 14,170 yuan/mt. It is likely to test pressure at the five- and 10-day moving averages tonight. 

Zinc: The SHFE 1812 contract initially received support at 22,000 yuan/mt and rose to a high of 22,160 yuan/mt. However, limited upward momentum and pressure from shorts dragged it to an intraday low of 21,900 yuan/mt. It closed at 21,980 yuan/mt with open interests down 9,084 lots. Without support at the five- and 10- day moving averages, the contract may extend its weak trend tonight. 

Nickel: The SHFE 1901 contract fell below the 100,000 yuan/mt level in the afternoon and failed to rebound till closing as shorts accumulated. It slid to an intraday low of 99,220 yuan/mt, the lowest in half a year. Some 435 million yuan of capital entered all SHFE nickel contracts, the greatest among base metals contracts. We expect the contract to test pressure at 100,000 yuan/mt tonight as its KDJ indicators expanded downwards. Investors may take more cues tonight from the US GDP for the third quarter and University of Michigan consumer sentiment index for October. 

Lead: The SHFE 1812 contract hovered at high levels during the day, and received support as shorts left near closing, and rose to a high of 18,540 yuan/mt. It settled above all moving averages at 18,520 yuan/mt, approaching the Bollinger upper band. We expect it to maintain its robust trend tonight, and test the Bollinger upper band at 18,600 yuan/mt level. 

Tin: The SHFE 1901 contract regained part of its losses near closing after it fell to a low of 146,940 yuan/mt. It lost 240 yuan/mt from Thursday to close at 147,480 yuan/mt. Support below will be at 146,000 yuan/mt tonight. 

SMM Evening Comments (Oct 26)

Price Review & Forecast 05:33:37PM Oct 26, 2018 Source:SMM

SHANGHAI, Oct 26 (SMM) – SHFE nonferrous contracts mostly dipped while the ferrous complex extended their upside trend across the board on Friday.  

SHFE nickel led losses and fell 2.45%, zinc slid 1.06%, aluminium dipped 0.35%, tin lost 0.22%, while copper went flat, and lead grew 1.28%. 

Iron ore surged 1.22%, rebar rose 1.15%, coking coal grew 1.08%, coke increased 0.12%, and hot-rolled coil gained 0.08%.    

Copper: The SHFE 1812 contract lost support at the Bollinger middle band as exiting longs lowered it to an intraday low of 49,720 yuan/mt. It settled at 49,750 yuan/mt with open interest shrinking 2,268 lots. The SHFE 1901 contract gained 3,084 lots in open interest today. With pressure at the five-day moving average and an extended MACD green line, the 1812 contract will test support at 49,500 yuan/mt tonight. 

Aluminium: Macroeconomic pessimism and a strong US dollar index weighed on the SHFE 1812 contract, which extended its decline in the afternoon to a low of 14,125 yuan/mt. While most base metals lost today, the contract registered a relatively smaller drop of 0.35% and settled at 14,170 yuan/mt. It is likely to test pressure at the five- and 10-day moving averages tonight. 

Zinc: The SHFE 1812 contract initially received support at 22,000 yuan/mt and rose to a high of 22,160 yuan/mt. However, limited upward momentum and pressure from shorts dragged it to an intraday low of 21,900 yuan/mt. It closed at 21,980 yuan/mt with open interests down 9,084 lots. Without support at the five- and 10- day moving averages, the contract may extend its weak trend tonight. 

Nickel: The SHFE 1901 contract fell below the 100,000 yuan/mt level in the afternoon and failed to rebound till closing as shorts accumulated. It slid to an intraday low of 99,220 yuan/mt, the lowest in half a year. Some 435 million yuan of capital entered all SHFE nickel contracts, the greatest among base metals contracts. We expect the contract to test pressure at 100,000 yuan/mt tonight as its KDJ indicators expanded downwards. Investors may take more cues tonight from the US GDP for the third quarter and University of Michigan consumer sentiment index for October. 

Lead: The SHFE 1812 contract hovered at high levels during the day, and received support as shorts left near closing, and rose to a high of 18,540 yuan/mt. It settled above all moving averages at 18,520 yuan/mt, approaching the Bollinger upper band. We expect it to maintain its robust trend tonight, and test the Bollinger upper band at 18,600 yuan/mt level. 

Tin: The SHFE 1901 contract regained part of its losses near closing after it fell to a low of 146,940 yuan/mt. It lost 240 yuan/mt from Thursday to close at 147,480 yuan/mt. Support below will be at 146,000 yuan/mt tonight.