SMM Morning Comments (Jun 19)

Published: Jun 19, 2019 10:07

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SMM Morning Comments

SHANGHAI, Jun 19 (SMM) –

Copper: Three-month LME copper rose 1.78% to close at $5,956/mt on Tuesday. The most active SHFE August contract opened higher and climbed to a high of 47,040 yuan/mt overnight before it closed 1.4% higher at 46,930 yuan/mt. Copper prices are expected to steady at highs today as the market works through US-China trade hopes and awaits results from the Fed meeting. LME copper is expected to trade between $5,890-5,960/mt today, with SHFE copper at 46,500-47,000 yuan/mt. Spot premiums are seen 20-60 yuan/mt as sharply higher prices of futures will spur selling enthusiasm.

Aluminium: Three-month LME aluminium advanced 1.11% to end at $1,778/mt on Tuesday, just below the 20-day moving average. It is expected to test resistance at $1,800/mt today, and trade between $1,770-1,820/mt. The most traded SHFE August contract crept up 0.58% to close at 13,875 yuan/mt overnight. It is expected to extend its gains today, with a trading range of 13,800-14,100 yuan/mt. Spot premiums are seen up to 20 yuan/mt over the July contract.

Zinc: Three-month LME zinc shrugged off resistance from several technical levels on Tuesday, gaining 1.6% to close at $2,513.5/mt. High cash premiums and the upcoming delivery date grow the risks of higher inventories. LME zinc is expected to hover around $2,500/mt today, with most transactions at $2,480-2,530/mt. The most active SHFE August contract broke the 20-day moving average to end at 20,200 yuan/mt overnight, up 1.3%, with the KDJ lines expanding upwards. SHFE zinc is expected to trade between 19,950-20,450 yuan/mt today, with support from the 20-day moving average under scrutiny.

Nickel: Three-month LME nickel rose to a high of $12,050/mt on Tuesday before it ended the trading day 1.57% higher at $11,950/mt. The most traded SHFE August contract hit a high of 100,320 yuan/mt overnight before it closed 1.56% higher at 99,630 yuan/mt. LME nickel is expected to trade between $11,900-12,100/mt today, with its SHFE counterpart at 99,000-101,000 yuan/mt. Spot prices are seen at 98,500-101,000 yuan/mt.

Lead: Three-month LME lead climbed to a high of $1,923/mt on Tuesday before it finished the trading day 1.81% higher at $1,916.5/mt. LME lead is likely to pull back after the market prices in the latest developments in US-China trade talks. The most active SHFE July contract rose to a high of 16,340 yuan/mt overnight before it ended 0.8% higher at 16,280 yuan/mt. SHFE lead has held firm at the current level for five consecutive sessions, and a substantial increase will help it begin an uptrend in the short term. Any retreat in SHFE lead will rekindle confidence in shorts.

Tin: Three-month LME tin rebounded from a low of $18,700/mt to close 1.59% higher at $19,205/mt on Tuesday. Support is seen at $18,500/mt, while resistance is at the 40-day moving average as high as $19,400/mt. The most traded SHFE September contract advanced 0.59% to end at 144,720 yuan/mt overnight. Support is seen at 143,500 yuan/mt while resistance is at the 40-day moving average as high as 145,500 yuan/mt.

Morning comments Copper Aluminium Zinc Lead Nickel Tin

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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