SMM Evening Comments (May 17)-Shanghai Metals Market

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SMM Evening Comments (May 17)

Price Review & Forecast 06:41:15PM May 17, 2019 Source:SMM

SHANGHAI, May 17 (SMM) – Most SHFE nonferrous metals closed lower on Friday, with the biggest loss of 0.8% in zinc. Tin fell 0.6%, aluminium and copper lost close to 0.3% while lead nudged up 0.06% and nickel gained 0.2%.

The ferrous complex continued their strong performance. Iron ore climbed 5.4%, coking coal rose 1.8%, rebar advanced 1.3%, hot-rolled coil gained 1.1% and coke went up close to 1%.  

Copper: Following the decline in LME copper, the most active SHFE July contract relinquished overnight gains and fell below the five-day moving average to an intraday low of 47,530 yuan/mt before it ended 0.25% lower at 47,630 yuan/mt. The unwinding of long positions primarily accounted for today’s losses. A total of 168 million yuan fled the SHFE copper complex on the day. The market tonight is likely to look for clues from the London market, with the strength of the 47,500 yuan/mt level in focus.

Aluminium: The loading up of short positions forced the most traded SHFE July contract to give up overnight gains to close the trading day 0.28% lower at 14,310 yuan/mt. Despite today’s pullback, rising alumina prices and declining inventories of primary aluminium will remain supportive of SHFE aluminium. The contract is expected to trade between 14,200-14,450 yuan/mt tonight.

Zinc: As shorts added their positions, the most active SHFE July contract fell during the day, erasing overnight gains to end 0.81% lower at 20,870 yuan/mt. Weaker-than-expected declines in social inventories of refined zinc across Shanghai, Guangdong and Tianjin reinforced the expectations for greater supplies. This, together with a flare-up in US-China trade dispute growing concerns about demand, is likely to continue to weigh on SHFE zinc. The contract is expected to trade around the five-day moving average tonight.

Nickel: The most traded SHFE July contract rebounded above 98,000 yuan/mt before a stronger US dollar forced it to relinquish some gains to end at 97,880 yuan/mt, up 0.18% on the day. Its KDJ lines continued to expand upwards, with an extended MACD red bar. The contract is expected to try to stand firmly above the 98,000 yuan/mt level tonight.

Lead: The most active SHFE June contract weakened during the day, and finished the trading day marginally higher at 16,120 yuan/mt. It has broken the 10-day moving average and lost much of Thursday’s gains. Lead stocks across SHFE-approved warehouses rose close to 5,000 mt this week. The contract is likely to extend its decline tonight and test the five-day moving average.

Tin: The most traded SHFE September contract extended its losses in the final trading hour of the day, falling 0.64% on the day to end at 145,340 yuan/mt. The buildup of short positions primarily accounted for today’s decline, which erased all Thursday’s gain. Support is seen at 145,000 yuan/mt.

Key Words:  Evening comments  Copper  Aluminium  Zinc  Nickel  Tin  Lead 

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SMM Evening Comments (May 17)

Price Review & Forecast 06:41:15PM May 17, 2019 Source:SMM

SHANGHAI, May 17 (SMM) – Most SHFE nonferrous metals closed lower on Friday, with the biggest loss of 0.8% in zinc. Tin fell 0.6%, aluminium and copper lost close to 0.3% while lead nudged up 0.06% and nickel gained 0.2%.

The ferrous complex continued their strong performance. Iron ore climbed 5.4%, coking coal rose 1.8%, rebar advanced 1.3%, hot-rolled coil gained 1.1% and coke went up close to 1%.  

Copper: Following the decline in LME copper, the most active SHFE July contract relinquished overnight gains and fell below the five-day moving average to an intraday low of 47,530 yuan/mt before it ended 0.25% lower at 47,630 yuan/mt. The unwinding of long positions primarily accounted for today’s losses. A total of 168 million yuan fled the SHFE copper complex on the day. The market tonight is likely to look for clues from the London market, with the strength of the 47,500 yuan/mt level in focus.

Aluminium: The loading up of short positions forced the most traded SHFE July contract to give up overnight gains to close the trading day 0.28% lower at 14,310 yuan/mt. Despite today’s pullback, rising alumina prices and declining inventories of primary aluminium will remain supportive of SHFE aluminium. The contract is expected to trade between 14,200-14,450 yuan/mt tonight.

Zinc: As shorts added their positions, the most active SHFE July contract fell during the day, erasing overnight gains to end 0.81% lower at 20,870 yuan/mt. Weaker-than-expected declines in social inventories of refined zinc across Shanghai, Guangdong and Tianjin reinforced the expectations for greater supplies. This, together with a flare-up in US-China trade dispute growing concerns about demand, is likely to continue to weigh on SHFE zinc. The contract is expected to trade around the five-day moving average tonight.

Nickel: The most traded SHFE July contract rebounded above 98,000 yuan/mt before a stronger US dollar forced it to relinquish some gains to end at 97,880 yuan/mt, up 0.18% on the day. Its KDJ lines continued to expand upwards, with an extended MACD red bar. The contract is expected to try to stand firmly above the 98,000 yuan/mt level tonight.

Lead: The most active SHFE June contract weakened during the day, and finished the trading day marginally higher at 16,120 yuan/mt. It has broken the 10-day moving average and lost much of Thursday’s gains. Lead stocks across SHFE-approved warehouses rose close to 5,000 mt this week. The contract is likely to extend its decline tonight and test the five-day moving average.

Tin: The most traded SHFE September contract extended its losses in the final trading hour of the day, falling 0.64% on the day to end at 145,340 yuan/mt. The buildup of short positions primarily accounted for today’s decline, which erased all Thursday’s gain. Support is seen at 145,000 yuan/mt.

Key Words:  Evening comments  Copper  Aluminium  Zinc  Nickel  Tin  Lead