Fundamentals and macro factors resonate, SHFE zinc records a small bullish candlestick [SMM Zinc Morning Comment]

SMM News on June 19:

Overnight, LME zinc opened at $2,636.5/mt. Early in the session, LME zinc rapidly rose to a high of $2,660/mt. Subsequently, its price center fluctuated around $2,655/mt. During European trading hours, LME zinc plunged below the daily average line to a low of $2,631/mt. Then, its price center fluctuated around $2,637/mt. It finally closed up at $2,643.5/mt, up $7/mt or 0.27%. Trading volume decreased to 89,509 lots, and open interest decreased by 3,356 lots to 208,000 lots. Overnight, LME zinc recorded a long upper shadow bullish candlestick, with the 20/60-day moving averages exerting pressure above. The US dollar index first fell and then rose overnight before the US Fed announced its interest rate decision. Meanwhile, tensions in the Middle East led to strong risk-averse sentiment in the market, causing LME zinc to rise first and then fall, maintaining a fluctuating trend.

Overnight, SHFE zinc opened lower with a gap at 21,945 yuan/mt. After opening, it immediately dropped to a low of 21,920 yuan/mt. Subsequently, it rapidly rose to a high of 22,020 yuan/mt. Then, as bulls reduced their positions, SHFE zinc fell to near the daily average line, with its price center fluctuating upwards around 21,960 yuan/mt. It finally closed down at 21,955 yuan/mt, down 105 yuan/mt or 0.48%. Trading volume decreased to 46,384 lots, and open interest decreased by 6,064 lots to 91,164 lots. Overnight, SHFE zinc recorded a small bullish candlestick, with the 20/60-day moving averages exerting pressure above and the 5-day moving average providing support below. Driven by the LME market, SHFE zinc opened lower with a gap overnight. The Lujiazui Forum officially opened yesterday, and the central bank announced eight major financial opening-up measures, releasing certain positive macro signals. However, the current fundamental end-use demand is weakening, and there are still expectations of ample supply. Zinc prices are expected to remain in the doldrums in the short term.