Mixed Long and Short Positions, SHFE Zinc Mainly Fluctuates and Consolidates [SMM Zinc Morning Comment]

Last Friday, Elon Musk challenged MAGA, while the Trump alliance faced internal discord over immigration issues; the European Central Bank may consider waiting longer before the next interest rate cut; the leader of Syria's Sham Liberation Front announced plans to dissolve the organization during the National Dialogue Conference; Yemen's capital Sanaa was hit by airstrikes, with Houthi forces claiming the US and UK were responsible; Pan Gongsheng stated the need to intensify and enhance the precision of monetary policy adjustments; the Hong Kong SAR government reported that the number of startups in Hong Kong reached a record high in 2024; Honor completed its equity restructuring and plans to initiate the IPO process at an appropriate time; China's first domestically developed and constructed Type 076 amphibious assault ship, the Sichuan, was officially launched.
Last Friday, LME zinc opened at $3,054/mt. In early trading, LME zinc briefly rose to a high of $3,055/mt. By the European trading session, longs reduced positions, and LME zinc declined to a low of $3,008/mt before stabilizing around $3,030/mt. It eventually closed higher at $3,040/mt, up $6/mt or 0.62%. Trading volume increased to 5,979 lots, while open interest decreased by 1,584 lots to 225,000 lots. Last Friday, LME zinc recorded a small bearish candlestick with a long lower shadow. LME inventory decreased by 4,450 mt to 244,500 mt, a drop of 1.79%. Expectations for US Fed interest rate cuts weakened, the US dollar strengthened, and base metals came under pressure, with LME zinc's center also shifting lower. It is expected to trade mainly in a range today.
Last Friday, the most-traded SHFE zinc 2502 contract opened at 25,170 yuan/mt. In early trading, shorts reduced positions, and SHFE zinc quickly surged to a high of 25,310 yuan/mt. Later, as longs exited, SHFE zinc's center shifted lower to 25,230 yuan/mt. By the end of the session, SHFE zinc's center moved higher again, closing at 25,300 yuan/mt, up 125 yuan/mt or 0.5%. Trading volume decreased to 60,598 lots, while open interest fell by 737 lots to 143,000 lots. Last Friday, SHFE zinc recorded a small bullish candlestick. The 20-day moving average above acted as resistance, with mixed positions from both longs and shorts. Macro sentiment remained relatively bearish, but fundamentals continued to provide support for SHFE zinc. It is expected to trade mainly in a range today.