Domestic Inventory Slightly Declines, SHFE Zinc Maintains Fluctuating Trend [SMM Zinc Morning Comment]

SMM November 12 News:

      Overnight, the LME zinc contract opened at $3,072.5/mt. At the beginning of the session, its center rose, touching a high of $3,100.5/mt. After entering European trading hours, bears increased their positions, causing LME zinc to fluctuate downward and probe a low of $3,038.5/mt. Although there was a slight rebound subsequently, the momentum was limited. It finally closed down at $3,040.5/mt, falling $31.5/mt, a decrease of 1.03%. Trading volume decreased to 121,000 lots, while open interest increased by 7,364 lots to 228,000 lots. On November 13, LME zinc inventory increased by 1,925 mt to 37,800 mt, a rise of 5.37%. Overnight, LME zinc recorded a bearish candlestick, with support provided by the 40/60-day moving averages below. As the US government ended its shutdown, the US dollar index continued to decline. However, overseas inventories increased by nearly 2,000 mt, leading LME zinc to rise first and then fall.

    Overnight, the most-traded SHFE zinc 2512 contract opened lower with a gap at 22,700 yuan/mt. Early in the session, SHFE zinc briefly surged, touching a high of 22,725 yuan/mt. Subsequently, bulls reduced their positions, pushing the price to fluctuate downward and probe a low of 22,620 yuan/mt. It then maintained a rangebound fluctuating trend and finally closed down at 22,635 yuan/mt, falling 105 yuan/mt, a decrease of 0.46%. Trading volume dropped to 40,145 lots, while open interest decreased by 281 lots to 103,000 lots. Overnight, SHFE zinc recorded a small bearish candlestick, with support provided by the middle Bollinger Band below. Current downstream consumption is mediocre, and demand-side support for SHFE zinc is weak. However, driven by the opening of the export window, domestic spot cargo is flowing overseas, providing some support to SHFE zinc. Zinc prices are expected to maintain a fluctuating trend in the short term.