Zinc Prices Encounter Resistance, Center Pulls Back [SMM Zinc Morning Comment]

Last Friday, LME zinc opened at $2,924/mt. In early trading, it fluctuated around the daily average line. Approaching European trading hours, it touched a high of $2,933/mt, but then bears increased their positions, pushing LME zinc down sharply. The price center shifted downward, oscillating near $2,890/mt, and finally closed down at $2,886.5/mt, a decrease of $36/mt or 1.23%. Trading volume decreased to 8,163 lots, while open interest increased by 2,312 lots to 219,000 lots. Last Friday, LME zinc formed a bearish candlestick, with support provided by the middle Bollinger Band. US inflation data largely met expectations, easing market concerns about a delay in US Fed interest rate cuts due to excessive price pressures, and the US dollar fluctuated at highs.

Last Friday, the most-traded SHFE zinc 2511 contract opened at 21,930 yuan/mt. In early trading, bears increased their positions, pushing SHFE zinc downward along below the daily average line. The price center shifted down to 21,720 yuan/mt, and it finally closed down at 21,705 yuan/mt, a decrease of 275 yuan/mt or 1.25%. Trading volume decreased to 87,654 lots, while open interest increased by 11,543 lots to 138,000 lots. Last Friday, SHFE zinc formed a bearish candlestick, encountering resistance from various moving averages above. Domestically, as the holiday approaches, operating rates at downstream enterprises have been reduced, while smelters have seen some recovery in October after September maintenance, keeping production high and putting zinc prices under pressure.

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