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SMM basic Metals spot Trading Weekly Review (2019.10.14-2019.10.18)
Oct 18,2019 20:23CST
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Source:SMM
SMM basic Metals spot Trading Weekly Review (2019.10.14-2019.10.18)
The content below was translated by Tencent automatically for reference.

SMM, 18 October:

This week, the market sentiment was mixed. At the beginning of the week, the framework of the Sino-US trade negotiation agreement was agreed, the Brexit process accelerated, the market performance improved, and the basic metals generally stabilized in the high range. However, as the global economic data were released one after another, the weak global economy caused the basic metals to give up their weekly gains one after another, showing a high pressure situation. SMMI fell 0.51% in the week, and the performance of various items of metals was seriously differentiated. Tin, lead and aluminum rose strongly, while nickel, zinc and copper continued to fall back. The strongest during the week was tin, which rose 1.82% during the week, as Yunxi announced that it would suspend production for nearly 50 days, which would affect production of about 5000 tons. Shanghai tin entered the market in a large scale, breaking through 140000 in one fell swoop to fill the previous gap, up 3.22%. Due to the rapid increase in the market, fear of high downstream, spot discount slightly expanded, spot is not as good as futures. Environmental protection production restrictions led to the re-entry of lead into the market again and again to push up Shanghai lead repeatedly above Wanqi, but due to the price difference between primary and recycled lead has expanded to more than 500yuan / ton, Shanghai lead rushed back up and down, spot discount correspondingly expanded, the exchange of high goods concentrated, SMMI.Pb rose by 1.04% per week. Domestic aluminum spot inventory fell by about 60,000 tons this week, encouraging Shanghai aluminum low recovery, spot rising water is rising, the current push, turn negative to close Yang, SMMI. Al week up 0.21%. Nickel high under pressure, showing a stepped decline, Shanghai nickel week fell 5.55%, spot water rose, making up for a small decline, SMMI.Ni week fell 3.96%. Shanghai Zinc Wanjiu pass is facing short selling pressure, although the spot rising water performance tends to be stable, but the trade deadlock is weak, the downstream bargain replenishment slightly supports the spot, SMMI.Zn weekly drop 0.94%. Shanghai copper performance is similar to zinc, 47000 yuan above the long reduction out of the market, the disk back to give up the increase, but the spot replenishment caused the spot water low level rose, SMMI.Cu weekly fell 0.68%. Next week, economic data from Europe and the United States are still concentrated and expected to remain weak, the US dollar is in a low position, and there may be some support for basic metals, there may be a long single delivery in the domestic trade market, and due to the upgrading of VAT bills, or the spot performance will be strong, most of the basic metals will maintain an interval concussion pattern, making it difficult for the time being to give birth to the ability and space for a major breakthrough.

 

 

Copper: this week, the center of gravity of copper moved down. Earlier this week, US President Donald Trump said China and the US had agreed on the framework for some trade agreements and that the two heads of state could sign the first phase of the agreement as soon as next month, while postponing tariff increases originally scheduled for this week. In addition, the Queen of England came forward to support the Johnson administration's Brexit resolution to promote the Brexit process. Driven by a positive mood, Lun Copper closed 4 Yang last week, peaking at $5822 a tonne. But then, crude oil reported that API inventories rose 9.28 million barrels that week, the weak demand for crude oil worried the market, depressing commodity prices. In addition, this week the IMF again cut the growth rate of the world economy this year, the important data released by the United States continued to be weak, and the weak global economy put pressure on copper prices to weaken. Copper market bulls lack of confidence, positive closing performance, copper prices quickly fell below the $5700 / ton mark, down $5696 / ton. At present, Lun copper is struggling near the 20-day moving average, with weak technical support. This week, Lun copper mainly showed a long reduction in positions, with positions reduced by 3757 hands to 278000 hands. Shanghai copper also failed to stand high this week, giving up last week's rally, the center of gravity fell down. Earlier this week, driven by positive trade sentiment, Shanghai copper surged to a high of 47210 yuan per ton. With the release of domestic economic data in September, China's import and export data in September both encountered "Waterloo", CPI rose PPI decline, market confidence performance is insufficient, and domestic "gold, nine and silver ten" consumption to promote limited, so high copper prices attracted short to operate, mid-week low opened weak, the weekend copper prices down 46530 yuan / ton, closing entities once again lost all the recent moving average support, MACD indicators appeared to be obviously weak. This week, the overall trading volume of the Shanghai copper index increased by 180000 hands to 1.198 million hands, and the position increased by more than 22000 hands to 571000 hands, mainly by short positions. In the spot aspect, after the National Day, the market accumulation effect is obvious, the domestic spot market supply is abundant, but under the delivery factor, still maintains the delivery level before delivery. After the exchange month, the spot quotation dropped obviously. When Pingshui copper was close to rising 40 yuan / ton, it attracted the willingness of traders, especially those with long single delivery, and the low price quickly attracted and boosted the buying sentiment in the market. And later this month will face the upgrading of tax tickets, more actively promote the market transaction, the quotation quickly rose to 70-100 yuan / ton, but due to the continuous increase in inventory, At the end of the curtain, the rhythm of lifting water has been obviously suppressed.

 

 

Aluminum: aluminum stopped falling this week, the center of gravity held steady, and the operating range gradually narrowed. Early Zhou Lun aluminum opened at $1724.5 / tonne, hit a low of $1710 / tonne on the day. With the domestic Shanghai aluminum rebound, Lun aluminum bottom gradually moved up, the performance of almost horizontal finishing, the operating range continues to narrow, concussion runs below the 10-day moving average. During the period, which reached a high of $1733 a tonne on Wednesday, it has not yet touched the 10-day moving average. As of 17:35 on Friday, Lun Aluminium was quoted at $1728.5 per ton. Weekly positions decreased by 24265 to 744450, mainly short positions. Among non-ferrous metals, Lun aluminum due to overseas alumina supply pressure increased, prices fell, bulls lack of confidence, even if the US index fell back, Lun aluminum did not see a significant rebound. At the same time, the domestic Shanghai aluminum rebound also made short of fear, Lun aluminum has not yet touched the lower $1700 / ton integer level. It is expected that next week, Lun aluminum above the 10-day moving average will continue to cross, if Lun aluminum is difficult to break through the moving average resistance, will again probe down to test 1700 US dollars / ton support, the overall operation of 1700 to 1735 US dollars / ton.

 

Shanghai aluminum fell to rebound this week, in addition to Monday closed Yin, followed by four Lianyang. At the beginning of the week, the Shanghai aluminum main force 1912 contract was opened at 13750 yuan / ton. At the beginning of the week, short positions tried to continue to crack down on aluminum prices. However, the sharp drop in social aluminum ingot inventory led to a lack of short confidence. Part of the short flight plus the long technical level made Shanghai aluminum stop falling and rose. As of Friday, Shanghai aluminum had crossed the 5-day moving average, and reached 13890 yuan / ton, closing at 13850 yuan / ton on the 10th. During the period, it hit a weekly low of 13705 yuan / ton on Monday and Tuesday. Weekly positions increased by 15068 to 232410, while weekly Shanghai Aluminum Index positions decreased by 7512 to 676822. At present, the domestic electrolytic aluminum fundamentals are still facing the contradiction of stable consumption at this stage and the increase of electrolytic aluminum supply pressure and the downward movement of cost in the future. Inventories continued to fall sharply during the week, coupled with a phased rebound in the technical side that led to the concentrated release of short sentiment. The current consumption is stable, inventory is expected to continue to decline next week, but the rate of decline may narrow, Shanghai aluminum continues to have limited upward space, integer level will encounter greater resistance, Shanghai aluminum will fluctuate around 13700 yuan / ton interval, it is suggested that the long stage profit closing position, short-term wave segment position can be increased appropriately.

 

In the spot market, aluminum prices fluctuated upward this week, rising significantly, with spot prices rising more than 200 yuan per ton from the beginning of the week to the weekend. Trading prices in Shanghai and Wuxi markets are concentrated in the range of 13780-14010 yuan / ton, of which Tuesday to Thursday rose day by day for four days, the actual spot discount this week is concentrated in the range of 10-80 yuan / ton, and the spot transaction price in Hangzhou is between 13800-14050 yuan / ton. Spot water rose more this week. At the beginning of the week, aluminum rose from about 20 yuan / ton to 80 yuan / ton on Friday. The main reason was that the market was nearly strong and far weaker, and the market supply was tight. The holder slightly cherished the selling price, the middleman was optimistic about the short-term price, receiving the goods was very positive, the market once appeared to pick up more, and the spot price rose accordingly. A large household also appeared several times that the actual volume of goods received was less than the planned purchase volume. Trading among traders as a whole is active, but downstream manufacturers generally closed this week. At the beginning of the week, due to the return of replenishment demand at the beginning of the week, receiving goods was more active. In the following days, as spot prices rose, some manufacturers began to fear heights and held a wait-and-see attitude towards prices. The enthusiasm for receiving goods has converged. Some manufacturers because the holders cherish the sale, can not buy spot, the actual transaction is also less. Overall, spot performance this week is stronger than futures, SMM and market traders concluded that the stronger spot due to the decline in arrival and October consumption is fair. It should be noted that the recent collapse of Wuxi flyover affected the transportation of aluminum ingots, and the upgrading process of VAT system at the end of the month prompted some traders to hand over orders in advance to issue invoices, both of which are short-term factors to stimulate spot water to rise.

 

 

Lead: this week, the trend of Lun lead first suppressed and then rose, and the high level approached the previous high again. At the beginning of the week, Lun lead in the continuous strong, high fell back, one after another broke through the 5 and 10 moving average support, the low once reached 2126.5 US dollars / ton, a few days later, the Lme lead-3 structure back expanded, coupled with low inventory support, Lun lead touched a low reverse rise, closed three Lianyang, fully make up for the decline at the beginning of the week, the high once reached 2189 US dollars / ton, after bearing pressure of $2200, Lun lead temporarily fell back, as of Friday, Lun lead is quoted at US $2177 / ton. Next week's overseas economic data will focus on the annualised total number of existing home sales in the US in September (549 before 545), the initial value of manufacturing PMI in the eurozone in October (45.7 before 46), the monthly rate of orders for durable goods in the US in September (0.2 per cent before 1 per cent), and the annualised total number of new home sales in the US in September (71.3 by 69.1). Expectations of economic data in Europe and the United States continue to be weak, or increase the probability of the Fed cutting interest rates in October, while trade between China and the United States shows signs of warming, and geopolitical with Turkey's brief ceasefire, it has also given some impetus to the recovery of the macro environment. Return to Lun lead, the technical graph is a typical long arrangement, there is no sign of the arrival of the main falling wave, the high level of US $2200 still has the possibility of a breakthrough, as of October 17, LME lead-3 structure back21.75 dollar / ton, inventory base in 69150 tons, LME lead back structure has little sustainability and support strength, there is the possibility of returning to Contango in the short term. In view of the above, it is suggested that we should wait and see carefully and wait for the choice of further direction. The expected operating range is $2145-$2220 per tonne.

 

This week, Shanghai lead followed the trend of Lun lead, the overall performance of the low rise. At the beginning of the week, Lun lead plummeted led to Shanghai lead low open low walk, breakdown below the important support 60-day moving average, low to 16725 yuan / ton, the main falling wave trend was initially formed, a few days later, the main force did not give up, try to save lead price, with Lun lead pull up Shanghai lead price, high level once reached 17200 yuan / ton, but with the regeneration of primary price spread further widened, short layout position entered, Shanghai lead high level fell back, as of Friday, reported at 17020 yuan / ton. There are no domestic economic data released next week, and the trend of lead in Shanghai mainly depends on changes in supply and demand on the fundamentals. We still maintain short selling of lead prices on the upper side, for the following reasons: first, the expected increment on the supply side comes from the release of production under the high profit of recycled lead, as well as the increase in the utilization rate of capacity up and down the processing fees of primary lead refineries, and the seasonal weakness on the consumer side also puts pressure on prices. From this week the regeneration of the original price spread to 500-600 yuan / ton can be seen, so we think that the probability of inventory inflection point is higher, and there is a high negative correlation between lead price and inventory, so lead price continues to be bearish. The range is estimated to be 16800-17200 yuan / ton.

 

This week spot lead mainstream trading range in 16800-17100 yuan / ton. This cycle lead hit low rebound, downstream procurement is extremely depressed, the overall transaction is bleak; primary lead market, with the gradual rise of lead price, smelter active shipment, as of Friday, refinery bulk single mainstream quotation to SMM1# lead average price discount 150 yuan / ton to 50 yuan / ton discount price; Trade market, holders actively ship, spot discount slightly expanded, as of Friday, domestic lead ordinary brand mainstream quotation to 1911 contract discount 50 yuan / ton to 20 yuan / ton; recycled lead, due to low consumption, recycled refinery every high expansion water shipment, as of Friday, recycled refined lead mainstream quotation to SMM1# lead average price discount of more than 500 yuan / ton.

 

 

Zinc: looking back on the price of zinc in Lunlun this week, after a slight decline in the beginning of Zhou, the center of gravity moved up to US $2420 / tonne. Under the suppression of the upper platform, Zinc fell below US $2400 / tonne integer support and fell below US $2393.5 / tonne. With the positive mood in the Sino-US trade agreement, under the bullish position, the uplink of Zinc Zinc rose by US $2434 / tonne, and then the pressure of Zinc Zinc fell back to US $2420 / tonne. Attempt to return to detect Brin Road on track suppression efforts, failed to line, once again under pressure fell back to $2410 / ton, coincided with the US index diving, Lun Zinc took advantage of the potential to pull up $2439 / ton, but failed to hold, pressure fell back to $2425 / ton first-line finishing operation, as of Friday, Lun Zinc closed at $2440 / ton, an increase of 0.76% within the week.

 

At the beginning of the week in Shanghai, zinc fell by 18890 yuan / ton. Under the support of the 20-day moving average, the center of gravity of Shanghai zinc operation moved up to 18970 yuan / ton. Xu Li rebounded, broke through the suppression of Wanjiu pass, and pushed up 19110 yuan / ton. the shorts entered the market sharply to suppress the zinc price. After the Shanghai zinc fell back to 18880 yuan / ton, it fell to 18700 yuan / ton again. Near the weekend, the macro news boosted it. Shanghai zinc operation center of gravity rose to 18800 yuan / ton narrow finishing operation, the operating range does not exceed 40 yuan / ton, and then short neatly left the court, Shanghai zinc upward to 18870 yuan / ton near consolidation. As of Friday, the Shanghai zinc main force 1912 contract was reported at 18860 yuan / ton, a weekly decline of 0.53%, the position increased by 47626 hands to 200000 hands.

 

This week, the price of domestic zinc ingots in Shanghai market is relatively stable to 1911, and the ordinary zinc brand is basically reported to be 110-120 yuan / ton. Shuangyan, Chihong market quotation rising water is basically flat with ordinary zinc quotation, to November rising water 120-130 yuan / ton. SMC and AZ reported an increase of 100-110 yuan per ton in November. The end of the first batch of long order delivery this week, coupled with the International lead and Zinc Conference held this week, the overall transaction of the Shanghai trade market is relatively light, mainly shipments, but due to the continued decline in zinc prices, Jiangsu and Zhejiang downstream enterprises are in a better mood to replenish their warehouses, and downstream consumption is improving. In terms of zinc imports, some of SMC and AZ circulated in the Shanghai trade market this week. Due to the continuous decline in internal and external prices, imported zinc is a single source of goods for traders. Enter next week, next month ticket gradually circulates in the market, the problem of shortage of goods of that month ticket may appear again, in addition next week trader long single delivery, expect spot to rise next week or performance is more strong.

 

This week, Guangdong Xianxian zinc discount to Shanghai zinc 1911 contract discount 5-10 yuan / ton, Guangdong stock market than Shanghai stock market from 150 yuan / ton on Friday, narrowed to 110 yuan / ton discount. Within the week, the refinery shipments are normal, the market supply circulation is more abundant. At the beginning of the week, the spot price in the Guangdong market continued last week, and the quotation focused on the discount of 30-40 yuan per ton on the 11 contract, but the market transaction was still relatively deserted. With the end of the lead and zinc year meeting, the trade market was gradually active, and from the market quotation trend, the discount gradually narrowed, the monthly difference between the current month and the next month contract gradually expanded, and the quotation of traders gradually increased. The highest quotation during the week was around 10-20 yuan / ton for the 11th contract. However, the consignee and the downstream did not have a strong willingness to accept the goods, and the spot rising water failed to hold on until Friday. Spot transactions are concentrated in the 11 contract discount of 5 yuan-10 yuan / ton near. Overall, the market was relatively deserted in the early part of the week, zinc prices fell in the second half of the week to boost downstream buying willingness, traders also contributed to the transaction, the overall transaction has improved compared with last week.

 

The contract for zinc 1911 in Shanghai rose 80-200 yuan / ton in Tianjin this week, and the stock market narrowed slightly from 40 yuan / ton to 30 yuan / ton in Shanghai on Friday. Refineries shipped normally during the week, the market supply tension trend has eased slightly, but the overall situation is still tight. This week disk downward, the shippers are more willing to ship, and did not raise the water, basically maintained in the 11 contract water 80-180 yuan / ton. This week, the first half of the week, the disk in the first nine lines of finishing and operation, rising water is more deadlocked, downstream is generally more bearish, the market is mainly inquiry wait-and-see, buy depressed; From the middle of the week to Friday, the center of gravity of the disk moved down, the shippers were willing to ship, and the rising water was slightly loosened. However, under the influence of haze weather, some galvanizing plants in Hebei had a few short days of production restrictions, but concentrated on the weekend, so only rigid demand for goods was maintained during the week, and downstream trading was still light. Overall, the overall trading situation in the downstream market this week was basically flat compared with last week.

 

 

Tin: Lunxi is generally in a concussive upward trend this week. At the beginning of the week, Lunxi generally maintained a horizontal arrangement around $16600 / ton, and then was affected by the sharp rise in the 2001 contract of the main domestic Shanghai tin market and the sharp decline in the dollar index. Lunxi followed suit, rising as high as $17240 / ton during the week. As of 18: 00 on Friday, the latest price for Lunxi was $17125 a tonne. The week rose $485 / tonne, or 2.91%, with 1601 hands traded and 17498 positions held, down 719 hands. The weekly level of Lunxi is Changyang line, and the lower part of the entity is supported by the 5-10 EMA. In terms of indicators, the daily line level MACD index fast line breaks through the zero axis, the KDJ index enters the overbought area, and the K line goes to the vicinity of the track. At the weekly level, the MACD index has a golden fork below the zero axis, the KDJ index still shows an upward trend, and the K line is still a certain distance from the middle track of Brin channel.

 

This week, tin in Shanghai generally showed a concussive upward trend, the center of gravity moved up obviously and successfully broke the resistance level near 140000 yuan / ton. At the beginning of the week, the overall consolidation of tin in Shanghai was maintained at about 136900 yuan / ton. Subsequently, under the influence of the long increasing position strength, coupled with the recent announcement by Yunnan Tin Industry Co., Ltd. that the equipment maintenance will begin on October 21, 2019, the maintenance time is expected to be no more than 50 days. According to the preliminary calculation of the production department of the company, the company's production shutdown and maintenance is expected to reduce fine tin production by about 10% compared with the original annual production plan. SMM estimates that it will affect the production of 5000-6000 tons of tin ingots, and Shanghai tin will rush up sharply. And break through the resistance level near 140000 yuan / ton. Shanghai tin closed at 140530 yuan per ton on Friday. The weekly increase was 4380 yuan / ton, or 3.22%, with a turnover of 198000 hands and a position of 42966 hands, an increase of 4098 hands. The weekly level of Shanghai tin presents the Changyang line, and the physical part is located near the 5-20 moving average. In terms of indicators, the daily line level MACD index shows a golden fork above two weeks, and the KDJ index line goes to the overbought area. The weekly level of KDJ index showed an upward trend.

 

Affected by the rise in tin in Shanghai this week, spot prices rose all the way from 137000-139,000 yuan / ton to 138000-141000 yuan / ton on Friday. The small increase in spot prices in Shanghai and tin is mainly due to the persistence of low-priced goods in the market, coupled with the sharp rise in tin prices and the intensification of wait-and-see sentiment among downstream enterprises. Only a small number of downstream enterprises purchased on demand and some packages met for low replenishment during the week. Upstream smelters generally have a high price mentality, low price shipment willingness is low. The overall transaction atmosphere in the Shanghai-tin spot market is relatively light during the week. In terms of discount, affected by the Shanghai period tin plate surging factors, the spot rising water range is narrowed, the sticking water range is expanded, and the quotation of market merchants is numerous and complicated. On Friday, the main force of Shanghai tin 2001 contract set Yunxi Pingshui-500 yuan / ton, ordinary cloud word discount 500 yuan / ton ~ 300 yuan / ton, small brand discount 1000-500 yuan / ton.

 

 

Nickel: this week, Lunni fell continuously from $17500 / ton to near the $16000 / ton mark on Monday. As a result, short positions increased by more than 8000 hands, leading to a one-day drop of $620 / ton, down 3.64%, and below the 60-day moving average support, down $16080 / tonne. As of Friday's Asian close, Lunni closed at the small negative line, closing at $16280 / ton. it showed a step-by-step downtrend for the fifth consecutive day of the week. Below all recent moving averages, there is no other support below. Lunni week K column showed a negative line, down 1305 US dollars / ton, down 7.45%; weekly trading volume increased by 8000 hands to 39000 hands, weekly position increased 4000 hands to 276000 hands, short showed leading signs. Shanghai nickel trend slightly lagged behind Lunni, Shanghai nickel 1912 contract fell 4 days since Monday, from 137000 yuan / ton line to 128000 yuan / ton line, in the 60-day moving average near the stable shock. In particular, on Thursday, Shanghai nickel fell 3750 yuan / ton, or nearly 3%, to 127340 yuan / ton during the day, the lowest point of the week. On Friday, Shanghai Nickel was supported by a 60-day moving average, slightly repaired and closed at 129300 yuan per ton. The main force of Shanghai nickel fell 7600 yuan / ton this week, down 5.55%. The weekly trading volume of the main contract increased by 4.807 million hands to 6.633 million hands, and the weekly position increased by 53600 hands to 362000 hands. Guard against the short force of the main contract gradually in the energy storage, but at present, Shanghai nickel is still more resistant to the decline than Lun nickel.

In the spot market, the Russian nickel contract for Shanghai Nickel 1911 rose about 250 yuan / ton this week, 200 yuan / ton more than last week. The main reason is that the transaction has improved in the first half of the week, and the supply of negotiable goods is tight. Jinchuan nickel to Shanghai nickel rose 1911 yuan / ton, an increase of 250 yuan / ton compared with last week, nickel prices fell, Jinchuan company has a strong desire to rise. In the first half of this week, spot transactions improved significantly, first, due to a large number of domestic steel mills receiving behavior; second, nickel prices continue to step back near the 135000 gate, downstream in the vicinity of 135000 to strengthen the willingness to purchase, a short period of time to increase the acceptance of this price. In the second half of the week, the nickel price fell below 135000 support, and the market appeared to buy up or not to buy or fall. In the process of falling, the number of buyers entering the market decreased compared with the first half of the week. However, due to the tight circulation of goods, the holders have a strong desire to rise, and the replenishment between traders has been restrained to a certain extent. It is expected that the Russian nickel contract for Shanghai Nickel 1911 will continue to rise by 300 yuan / ton to 500 yuan / ton next week, and Jinchuan's Shanghai Nickel 1911 contract will rise by 500-800 yuan / ton.

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