Insufficient Consumption Support, Zinc Prices Encounter Resistance [SMM Zinc Morning Comment]

Overnight, the LME zinc contract opened at $3,084/mt. In early trading, it fluctuated around the daily average line. During European trading hours, after touching a high of $3,105/mt, it was sold by bears at highs and fluctuated downward, eventually closing down at $3,055.5/mt, a decrease of $35.5/mt or 1.15%. Trading volume decreased to 10,631 lots, while open interest increased by 2,708 lots to 221,000 lots. Overnight, the LME zinc contract recorded a long upper shadow bearish candlestick, with the KDJ indicator's opening expanding downward. Overnight, due to a stronger US dollar, LME zinc retreated after a rapid rise, but overall it still maintained highs, with limited downside room for the zinc price.

Overnight, the most-traded SHFE zinc 2601 contract opened at 22,745 yuan/mt. During the session, it consolidated around the daily average line, touching a high of 22,800 yuan/mt and a low of 22,700 yuan/mt, eventually closing up at 22,715 yuan/mt, an increase of 10 yuan/mt or 0.04%. Trading volume decreased to 52,529 lots, while open interest decreased by 1,272 lots to 105,000 lots. Overnight, SHFE zinc stopped rising and started to fall, but the center of the daily candlestick moved upward, encountering resistance from the upper Bollinger Band. On the fundamentals, supply-side support at the bottom is strong, but poor consumption is putting pressure on the zinc price. In the short term, the zinc price is expected to fluctuate at highs.

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