SMM Evening Comments (Oct 30)

Price Review & Forecast 07:15:59PM Oct 30, 2018 Source:SMM

SHANGHAI, Oct 30 (SMM) – The SHFE nonferrous contracts and ferrous complexes, except for coke, extended their declines across the board on Tuesday.  

SHFE zinc led losses and fell 1.64%, aluminium slid 0.7%, lead dipped 0.59%, nickel lost 0.57%, copper went down 0.36%, and tin closed 0.17% lower.  

While coke inched up 0.13%, hot-rolled coil slid 0.62%, rebar lost 0.45%, iron ore declined 0.28%, and coking coal fell 0.21%.  

Copper: The SHFE 1812 contract faced pressure at the 20-day moving average as it increased to a high of 49,890 yuan/mt in the afternoon, which approached the Bollinger middle band. A weaker LME copper and rising shorts lowered the contract, which settled at 49,700 yuan/mt with open interests up 1,242 lots. We expect it to test support at the 49,890 yuan/mt level tonight. 

Aluminium: Slower declines in domestic social inventories weighed on the SHFE 1812 contract after its initial increase. It closed at 14,085 yuan/mt after falling to an intraday low of 14,080 yuan/mt. Open interests lost 8,160 lots to 225,000 lots during the day. As transactions cooled, the contract will test pressure above at five- and 10-day moving averages tonight. 

Zinc: With pressure from rising shorts, the SHFE 1812 contract slumped below the 20-day moving average, to a low of 21,680 yuan/mt right after opening. It then rebounded and hovered around 21,800 yuan/mt as shorts took profits and left. News about the potential inflow of overseas zinc concentrate grew confidence across shorts. The contract may extend its weak trend tonight and test support at the Bollinger middle band.  

Nickel: The SHFE 1901 contract fell for the fourth straight day after a stronger US dollar and surging shorts dragged it to a low of 97,930 yuan/mt near closing. It rose to a high of 99,150 yuan/mt at one point, facing pressure at the daily moving average before noon. The contract closed at 98,390 yuan/mt with open interests up 5,000 lots. We expect it to test support at 98,000 yuan/mt tonight as its KDJ indicators expanded downwards and the MACD green line lengthened. Investors may take more cues tonight from the US Conference Board consumer confidence index for October.

Lead: The SHFE 1812 contract traded weakly during the day with pressure at the daily moving average. It ended its four consecutive trading days of gains and settled at 18,405 yuan/mt, down 115 yuan/mt from Monday. We see it testing support at the 10-day moving average tonight. 

Tin: The SHFE 1901 contract rebounded in the afternoon after hovering at lows in the morning. It rose to an intraday high of 147,190 yuan/mt but still closed lower from Monday at 146,680 yuan/mt. Lacking supportive factors from the macroeconomy and fundamentals, the contract will test support at 146,000 yuan/mt in the short term. 

SMM Evening Comments (Oct 30)

Price Review & Forecast 07:15:59PM Oct 30, 2018 Source:SMM

SHANGHAI, Oct 30 (SMM) – The SHFE nonferrous contracts and ferrous complexes, except for coke, extended their declines across the board on Tuesday.  

SHFE zinc led losses and fell 1.64%, aluminium slid 0.7%, lead dipped 0.59%, nickel lost 0.57%, copper went down 0.36%, and tin closed 0.17% lower.  

While coke inched up 0.13%, hot-rolled coil slid 0.62%, rebar lost 0.45%, iron ore declined 0.28%, and coking coal fell 0.21%.  

Copper: The SHFE 1812 contract faced pressure at the 20-day moving average as it increased to a high of 49,890 yuan/mt in the afternoon, which approached the Bollinger middle band. A weaker LME copper and rising shorts lowered the contract, which settled at 49,700 yuan/mt with open interests up 1,242 lots. We expect it to test support at the 49,890 yuan/mt level tonight. 

Aluminium: Slower declines in domestic social inventories weighed on the SHFE 1812 contract after its initial increase. It closed at 14,085 yuan/mt after falling to an intraday low of 14,080 yuan/mt. Open interests lost 8,160 lots to 225,000 lots during the day. As transactions cooled, the contract will test pressure above at five- and 10-day moving averages tonight. 

Zinc: With pressure from rising shorts, the SHFE 1812 contract slumped below the 20-day moving average, to a low of 21,680 yuan/mt right after opening. It then rebounded and hovered around 21,800 yuan/mt as shorts took profits and left. News about the potential inflow of overseas zinc concentrate grew confidence across shorts. The contract may extend its weak trend tonight and test support at the Bollinger middle band.  

Nickel: The SHFE 1901 contract fell for the fourth straight day after a stronger US dollar and surging shorts dragged it to a low of 97,930 yuan/mt near closing. It rose to a high of 99,150 yuan/mt at one point, facing pressure at the daily moving average before noon. The contract closed at 98,390 yuan/mt with open interests up 5,000 lots. We expect it to test support at 98,000 yuan/mt tonight as its KDJ indicators expanded downwards and the MACD green line lengthened. Investors may take more cues tonight from the US Conference Board consumer confidence index for October.

Lead: The SHFE 1812 contract traded weakly during the day with pressure at the daily moving average. It ended its four consecutive trading days of gains and settled at 18,405 yuan/mt, down 115 yuan/mt from Monday. We see it testing support at the 10-day moving average tonight. 

Tin: The SHFE 1901 contract rebounded in the afternoon after hovering at lows in the morning. It rose to an intraday high of 147,190 yuan/mt but still closed lower from Monday at 146,680 yuan/mt. Lacking supportive factors from the macroeconomy and fundamentals, the contract will test support at 146,000 yuan/mt in the short term.