LME's strength drove SHFE zinc to record a bullish candlestick with no upper shadow [SMM zinc morning comment]

Overnight, the LME zinc contract opened at $2,831/mt. At the beginning of the session, bulls increased their positions, driving LME zinc upward along the daily moving average. During European trading hours, the price center shifted to around $2,860/mt. Subsequently, bears entered while bulls took profits, causing LME zinc to test lower levels. In the night session, the price center moved down to $2,840/mt before rebounding to consolidate near $2,860/mt by the close. It finally settled at $2,865.5/mt, up $32.5/mt (1.15%). Trading volume rose to 13,277 lots, while open interest increased by 4,327 lots to 197,000. Overnight, LME zinc recorded a four-day winning streak, supported by various moving averages below, with the KDJ indicator expanding upward. Zinc prices fluctuated upward overnight, as LME inventory continued to decline and the LME 0-3 backwardation structure widened to $20.44/mt, indicating increased fund concentration.

Overnight, the most-traded SHFE zinc 2510 contract opened at 22,250 yuan/mt. At the start of the session, SHFE zinc briefly tested a low of 22,230 yuan/mt before rising steadily amid bulls' entry and bears' exit. It closed at the day's high of 22,365 yuan/mt, up 100 yuan/mt (0.45%). Trading volume stood at 59,362 lots, while open interest decreased by 956 lots to 107,000. Overnight, SHFE zinc formed a bullish candlestick with no upper shadow, facing resistance from the 20/40 daily moving averages above. Against the backdrop of macro expectations for an interest rate cut, bearish funds mainly exited positions overnight. Boosted by the LME's upward movement, SHFE zinc rose, though fundamental support remained insufficient, warranting attention to fund flows.

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