Home / Metal News / SMM Morning Comments (Dec 12)

SMM Morning Comments (Dec 12)

iconDec 12, 2019 09:37
Source:SMM
SHFE base metals, except for zinc and tin, traded higher overnight

SHANGHAI, Dec 12 (SMM) –

Copper: Copper prices extended their gains overnight, on hopes that the US would delay imposing more trade tariffs on Chinese goods and as investors had to cover short positions to avoid further losses. Three-month LME copper advanced 0.86% on the trading day to end at $6,144.5/mt. The most active SHFE 2002 contract strengthened 0.9% to 49,240 yuan/my overnight. A weaker US dollar also offered support to copper prices, as the Fed dashed hopes for interest rate hikes next year. LME copper is expected to trade between $6,120-6,170/mt today, with SHFE copper at 49,100-49,600 yuan/mt. Spot premiums are seen at 10-40 yuan/mt, with high prices keeping buyers on the sidelines.

Aluminium: Three-month LME aluminium recovered from earlier losses to end 0.37% firmer at $1,759.5/mt on Wednesday. It is expected to move between $1,740-1,780/mt today. The most traded SHFE 2002 contract hovered around the five-day moving average overnight, and closed 0.11% higher at 13,935 yuan/mt. Resistance appeared strong at the 14,000 yuan/mt level. SHFE aluminium is likely to waver between 13,750-13,900 yuan/mt today. Spot premiums are seen at 10-30 yuan/mt over the SHFE 1912 contract.

Zinc: Three-month LME zinc climbed to an intraday high of $2,241.5/mt on Wednesday, before it gave back the majority of those gains due to resistance at the 10-day moving average. It finished the trading day 0.11% higher at $2,227/mt, still just kissing distance away from three-month lows it plumbed last week. It is likely to trade between $2,200-2,250 yuan/mt today, after overnight signal from the Fed of no interest rate cuts in 2020. The most active SHFE 2002 contract jumped to a session-high of 17,925 yuan/mt in early trade overnight, before it eased to close a tad weaker at 17,860 yuan/mt. SHFE zinc is under pressure from the five-day moving average and supported by the 10-day one, with MACD indicators in a golden cross. It is expected to move between 17,700-18,100 yuan/mt today. Spot premiums for domestic 0# Shuangyan are seen at 140-190 yuan/mt over the SHFE 1912 contract, with trades likely to improve on stockpiling before the weekend.

Nickel: Three-month LME nickel rallied to a two-week high of $13,865/mt on Wednesday, before it finished the day 3.21% higher at $13,845/mt. LME nickel is approaching the 20-day moving average, with resistance at $14,000/mt. As shorts trimmed their positions, the most traded SHFE 2002 contract extended its rally to the 110,000 yuan/mt level overnight, ending up 2.79% at 109,840 yuan/mt. SHFE nickel has stood above the five- and 10-day moving averages, and now faces resistance at 110,000 yuan/mt and the 20-day moving average.

Lead: Three-month LME lead rose above the 10-day moving average to its highest since December 2 at $1,937/mt on Wednesday, before closing up 0.94% at $1,934/mt. LME lead has strengthened for three consecutive days after significant losses, and will test pressure at the 20-day moving average. The most active SHFE 2001 contract tracked gains in LME lead to a nearly two-week high of 15,315 yuan/mt overnight, before it ended 0.49% stronger at 15,245 yuan/mt. Despite gains in the past week, SHFE lead remains under pressure from the 20-day moving average.

Tin: Three-month LME tin pulled back, slipping 1.64% to end at an intraday low of $17,125/mt on Wednesday. LME tin still resides above all near-term moving averages, with support at $17,000/mt. The unwinding of long positions knocked the most traded SHFE 2001 contract to a session-low of 140,570 yuan/mt in early trade overnight, before the contract later recovered some ground to end down 0.3% at 141,060 yuan/mt. Resistance lies at 142,000 yuan/mt, while support lies at the five-day moving average at 140,500 yuan/mt.

Morning comments
Copper
Aluminium
Zinc
Lead
Nickel
Tin

For queries, please contact Michael Jiang at michaeljiang@smm.cn

For more information on how to access our research reports, please email service.en@smm.cn

Related news

SMM Events & Webinars

All