Weak consumption support, SHFE zinc in the doldrums [[SMM Zinc Morning Comment]]

SMM, April 28:

On Friday, LME zinc opened at $2,705.5/mt. At the beginning of the session, bears increased their positions, and LME zinc briefly rose to $2,710/mt after the opening before fluctuating downward throughout the session, hitting a low of $2,642/mt at the close. It eventually closed down at $2,645.5/mt, down $59.5/mt or 2.2%. Trading volume increased to 10,898 lots, while open interest rose by 1,055 lots to 205,000 lots. On Friday, LME zinc recorded a large bearish candlestick, with the 5/10-day moving averages providing support below and the middle Bollinger Band forming resistance above. Driven by hopes of an easing in global trade tensions, the US dollar index rose, and the center of LME zinc moved downward.

On Friday, the most-traded SHFE zinc 2506 contract opened at 22,630 yuan/mt. At the beginning of the session, bulls reduced their positions, and SHFE zinc briefly fell to a low of 22,525 yuan/mt before oscillating along the daily average line, with fluctuations of less than 100 yuan. It eventually closed down at 22,550 yuan/mt, down 200 yuan/mt or 0.88%. Trading volume decreased to 61,118 lots, while open interest increased by 2,803 lots to 120,000 lots. On Friday, SHFE zinc recorded a small bearish candlestick. According to SMM, zinc concentrate TCs for May rose by 50 yuan/mt (metal content), with the rate of increase slowing. However, consumption support gradually weakened, and SHFE zinc was mainly in the doldrums. It is expected that zinc prices will continue to oscillate.