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SMM Evening Comments (Dec 2)
Dec 2,2019 19:05CST
price review forecast
Nickel remained the laggard, shedding 2.27% on Monday

SHANGHAI, Dec 2 (SMM) – SHFE nonferrous metals closed mixed on Monday. Nickel remained the laggard, shedding 2.27%. Zinc lost 1.11%, lead fell 1.26%, while copper advanced 0.04%, aluminium rose 0.9%, and tin grew 0.69%. 

The ferrous complex also traded on a mixed note as iron ore added 1.16%, rebar gained 0.44%, hot-rolled coil increased 1.58%, while stainless steel lost 0.92%, and coke went down 0.22%.

Copper: Unexpected growth in November’s factory activities in China drove bullish position to enter, lifting the most-active SHFE 2001 contract to an intraday high of 47,370 yuan/mt. It pared some gains to close at 47,300 yuan/mt, up 0.04% on the day, as trade uncertainties between Beijing and Washington unable to support a significant price rally. The KDJ indicators expanded downwards, suggesting technical pressure above. This may see the contract testing support from 47,300 yuan/mt tonight. 

Aluminium: The most-liquid SHFE contract rose for the third consecutive day as greater than expected drop in social inventories of primary aluminium boosted morale among longs. The contract shrugged off resistance from the 60-day moving average to hit an intraday high of 13,970 yuan/mt, closing up 0.9% at 13,950 yuan/mt. Delayed resumption of some primary aluminium capacity may continue to see social inventories falling in the near term. Tonight, the contract will test pressure from 14,000 yuan/mt. 

Zinc: Loaded-up shorts accelerated the decline in the most-traded SHFE 2001 contract, but the drop was restrained by a continued slide is social inventories of refined zinc. The contract slipped to an all-time low of 17,675 yuan/mt and ended down 1.11% at 17,785 yuan/mt. Support from the Bollinger lower band will be monitored tonight. 

Nickel: The most-liquid SHFE 2002 contract extended decline from last Friday night, losing 2.27% on the day to finish at 108,080 yuan/mt. Open interest shrank 4,000 lots to 365,000 lots. The price spread between SHFE 1912 and 2002 contracts again widened to 700 yuan/mt. Without any significant support below, the contract may stay rangebound around 108,000 yuan/mt tonight. 

Lead: A weakened SHFE zinc depressed the most-traded SHFE 2001 contract, which shed 1.26% on the day and closed at 15,300 yuan/mt. However, it did not break the lower limit of its rangebound trend. With weak fundamentals and heavy pressure from the 10-day moving average, the contract may consolidate at lows tonight. 

Tin: The most-liquid SHFE 2001 contract climbed amid loaded-up longs and departing shorts, ending at an intraday high of 139,360 yuan/mt, up 0.69% on the day. Pressure above is seen from 139,500 yuan/mt tonight.

Evening comments
Futures movement

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