(19 February)

General situation of the epidemic situation: the control of the epidemic situation has continued to improve, the obstruction of transportation has been further alleviated, the resumption of work has continued to expand, and the demand is still morbid.

Current situation of < II > period

Spot prices are under pressure, but pessimistic expectations have converged.

Tangshan area billet: stable to 3000 yuan / ton.

Raw material end: scrap price is weak, coking coal price is strong, coke is weak and stable; iron ore PB powder rose to 645yuan / ton right, trading volume is larger than yesterday.

Futures overall weak concussion: rebar weak concussion, far-month contract performance is weaker; stone performance although outstanding, but the rise is weak; coke performance is the weakest, coking coal performance is on the strong side.

< 3 > Futures Tips for tomorrow

RB2005 main contract: support level 3350, pressure level 3440.

HC2005 main contract: support level 3370, pressure level 3470.

Operation: low and single gradually involved in the main.

I2005 main force contract: support level 627, 615, pressure 650.

Operation: near the short-term pressure position, the empty single light warehouse is involved.

J2005 main contract: support level 1820, pressure level 1900.

Operation: near the short-term pressure position, the empty single light warehouse is involved.

JM2005 main contract: support level 1230, pressure level 1300.

Operation: wait-and-see or radical high empty single light warehouse intervention.

< IV > Heart language (a brief analysis of the four stages).

1. The irrational stage or the first stage of the crown.

Yellow Crane with cover, epidemic situation to promote the mismatch of supply and demand in the industrial chain: futures from the vast land, a sword broke late, after the festival sad step into place; so far most of the recovery of lost land, no need for red rain to wash incense cheeks to the ground. But the spot infinite short fall is still not over.

2. The convergence stage or the second stage of multi-empty irrationality.

Yellow crane shroud certainty and time uncertainty game, that is, the medium-term rebound and short-term spot difficult to stabilize or under pressure consensus consistency enhanced.

The main contradiction of short-and medium-term game is the extremely high inventory expected PK absolute low valuation. First of all, the author still insists that the forward-looking logical deduction remains unchanged, that is, the demand is only late and will not be absent, there is no doubt about the retaliatory return period after the epidemic, or the exchange of time for space is bound to be fulfilled!

You might as well deduce the supply side first:

At present, independent electric arc furnace steel enterprises are almost shut down; most long-process steel enterprises prefer to reduce the proportion of added scrap, and a small or very small number of steel enterprises are forced to stop production and maintenance because of confirmed cases or because of storage capacity pressure or because employees are not on duty or are forced to stop production and maintenance because of cooking without rice at the raw material end. Independent electric arc furnace author forward-looking language spot price rebound did not cover the loss of tons of steel (400 right yuan / ton), the swing of electric arc furnace production capacity is very limited.

Therefore, the supply side pays attention to the long process output variable is the right way. At present, epidemic control and resumption of production should go hand in hand, both indispensable! As a result, it is inferred that multi-factors contribute to the failure of the driving force for production reduction, that is, the inflection point of convergence on the supply side has emerged.

Demand side deduction:

The return period of the demand side is proportional to the time, and few people should not support this view. The author predicts that the basic return period in the first half of March will be a high probability event!

Spatio-temporal prediction of inventory peak:

The above supply and demand deduction, the inventory peak time should be the end of February right probability, base warehouse maximum: five varieties about 38 million tons, rebar about 19 million tons.

3. The third stage or the same stage of supply and demand.

This stage is mainly de-inventory to a reasonable level, that is, the spot price is ready to be issued.

Note: at present, the market is copied on the financial pressure of steel enterprises and steel traders. The author tends to think that the impact is very limited! First, the so-called long-process steel enterprises financial pressure, really worried for the ancients! Second, the force majeure "guardian" has a very limited impact on steel traders.

4. The fourth stage is the formal opening stage of the rebound, the main driving force is that the demand return period is more future.

To sum up, the spot at this stage should be pre-dawn darkness, following the limited downward space, billet 3000 yuan / ton has become attractive. Spot operation suggests, depending on their own conditions to fall again and dare to start to replenish the inventory rhythm.

Note: the risk epidemic is out of control.

< 5 > epidemic variables are still in the dominant period of disturbance, pay attention to the epidemic control process.

< 6 > forward-looking logical deductions and views remain unchanged:

See "New Coronavirus injury Price Verification" for details.

< 7 > pay attention to the sunrise of inventory data.

If you want to know the details of the market in the later period, consult Lu Qingping, Iron and Steel Department 021-51595781

(disclaimer: this article is exclusively produced and published by the author under the exclusive authorization of SMM Iron and Steel, and may not be reproduced without authorization)