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SMM Evening Comments (Apr 11)
Apr 11,2019 17:39CST
price review forecast
SMM Evening Comments

SHANGHAI, Apr 11 (SMM) – SHFE nonferrous metals, except for zinc, declined across the board on Thursday April 11. Lead led the losses and slid 2%, tin declined 0.81%, copper fell 0.77%, nickel lost 0.51%, and aluminium dipped 0.11%.

The ferrous complex ended mixed as rebar grew 1.44%, iron ore rose 1.16%, hot-rolled coil increased nearly 1%, while coking coal dropped almost 1%, and coke went down 0.79%. 

Copper: The most-liquid SHFE June contract fell below the five-day moving average and tested support at the 20-day moving average as growing shorts dragged it to a low of 49,210 yuan/mt in the afternoon. It bounced back but failed to break pressure from 49,340 yuan/mt, and ended at 49,270 yuan/mt. Open interests accumulated 5,130 lots to 187,000 lots. Bearish signs from the KDJ indicators are likely to see the contract testing support at 49,150 yuan/mt tonight. 

Aluminium: Domestic social inventories of primary aluminium registered a smaller week-on-week decline of some 5,000 mt, and this grew shorts in the most-active SHFE May contract at noon. The contract slid from a high of 13,845 yuan/mt, and stemmed its decline at 13,820 yuan/mt, settling at 13,830 yuan/mt. Open interests across all SHFE aluminium contracts shrank 6,296 lots as longs exited. There remains upward momentum in the contract tonight. 

Zinc: The SHFE 1906 contract ceased its decline at 22,250 yuan/mt and rebounded above the daily moving average, after its LME counterpart strengthened. It tested pressure from the five- and 10-day moving averages, before it closed at 22,395 yuan/mt. Recovery of consumption and a higher LME zinc may keep it testing resistance from the five- and 10-day moving averages tonight. 

Nickel: The SHFE June contract found support at the 10-day moving average after it slid to an intraday low of 102,210 yuan/mt. It rebounded and closed at 102,660 yuan/mt, with open interests up 5,000 lots to 190,000 lots. As the MACD red line shortened, the contract may continue to test support at the 10-day moving average tonight. 

Lead: As shorts continued to grow, the SHFE May contract fell to the lowest today at 16,410 yuan/mt, after it temporarily ceased its decline below the daily moving average at 16,480 yuan/mt. It ended 2% lower on the day at 16,445 yuan/mt. Open interests for short positions rose some 4,000 lots during two consecutive trading days and depressed confidence across longs. Spot sellers of battery scrap and secondary lead attempted to firm up offers, and this kept market participants cautious.  

Tin: The SHFE May contract fell below previous support at 147,500 yuan/mt, and dropped to an intraday low of 146,830 yuan/mt near closing. Pressure from the five- and 10-day moving averages settled it at 146,870 yuan/mt. Open interests lost 1,664 lots to 16,790 lots as longs left. It is expected to trade at lows with support at 146,500 yuan/mt.

Evening comments
Futures movement

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