[SMM Analysis] Aluminum prices stop falling, rebound, continue to rise, lack of motivation.

SMM7 4: from June 28, the Shanghai aluminum index continued to probe, July 3 during the period reached a low of 13620 yuan / ton, the lowest point since March 11 this year, breaking below all averages. Driven by the general rebound in the surrounding market, July 3 night Shanghai aluminum low repair rebound. On July 4, Shanghai Aluminum continued to rise in late trading, rising 0.84 per cent to 13765 yuan per ton by 14:58 in the afternoon. Successfully climbed to the 5-day moving average.

SMM does not think this will be a wave of rising prices, short-term judgment of aluminum prices still have to return to fundamentals.

Cost side, review the market in June to do alumina price downward expectations, and now the price is not yet to the end, the aluminum price is difficult to support; the consumer side of the recent slowdown in the speed of domestic electrolytic aluminum storage, the market is worried about the stock accumulation of the off-season consumption from July to August. And yesterday's aluminum main company 1908 contract reached a new low of 13620 yuan / ton in mid-March, a small bottom rebound is also a normal phenomenon.

In the long run, the 1907 / 2003 contract has become a contango structure, indicating that the market has certain expectations for the autumn September and October consumption peak season, so our operation suggestion is around 13500 yuan / ton to try more than one order.

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