SHFE Zinc Records a Bullish Candle, SHFE Zinc Still Fluctuates at Highs [SMM Zinc Morning Comment Nov 25]

Last Friday, the US November PMI data increased; the total US national debt has surpassed $36 trillion; Russian Defense Minister: Ukraine's "strongest troops" have been annihilated; Senior Advisor to Iran's Supreme Leader: Preparing to "respond" to Israel; Oil market observers: OPEC+ is expected to delay production increases again; Premier Li Qiang presided over a State Council executive meeting to discuss promoting the healthy development of the platform economy; Ministry of Foreign Affairs: Visa-free entry for Bulgaria, Romania, Japan, and other countries.

Last Friday, LME zinc opened at $2,996/mt. At the beginning of the session, LME zinc fluctuated upward along the daily moving average and reached a high of $3,014.5/mt. However, due to insufficient momentum, it fell below the daily moving average. Subsequently, LME zinc briefly fluctuated rangebound around the daily moving average, then plunged and continued to fluctuate downward, reaching a low of $2,962.5/mt. By the end of the session, it slightly recovered some losses and finally closed down at $2,972/mt, a decrease of $31.5/mt or 1.05%. Trading volume decreased to 77,815 lots, while open interest increased by 1,721 lots to 244,000 lots. Last Friday, LME zinc turned from bullish to bearish, with the 20-day moving average forming resistance above and the lower Bollinger Band providing support below. LME social inventory decreased by 3,300 mt to 261,325 mt, a reduction of 1.25%, indicating a decline in LME inventory. The current fundamental supply remains tight, providing short-term support for zinc prices.

Last Friday, the most-traded SHFE zinc 2512 contract opened at 25,030 yuan/mt. At the beginning of the session, SHFE zinc fluctuated upward above the daily moving average, reaching a high of 25,235 yuan/mt. Subsequently, SHFE zinc's center of gravity slightly declined, fluctuating around 25,150 yuan/mt, and finally closed down at 25,165 yuan/mt, a decrease of 5 yuan/mt or 0.02%. Trading volume decreased to 51,368 lots, while open interest decreased by 6,411 lots to 86,173 lots. Last Friday, SHFE zinc recorded a bullish candle, with the upper Bollinger Band forming resistance above and the middle Bollinger Band providing support below. Domestic supply-side issue also exists, with the arrival of the off-season combined with winter stockpiling, still supporting zinc prices to fluctuate at highs.