LME Trends Boost SHFE, SHFE Zinc Center Shifts Upward [SMM Zinc Morning Comment]

SMM May 21:

During the overnight session, LME zinc opened at $3,513/mt. After the open, LME zinc fluctuated upward throughout the session, touching a low of $3,499.5/mt early in the session and a high of $3,569.5/mt late in the session, ultimately closing higher at $3,567.5/mt, up $56.5/mt or 1.61%. Trading volume increased to 9,871 lots, and open interest decreased by 2,775 lots to 236,000 lots. Overnight, LME zinc posted a bullish candlestick, with the upper Bollinger Bands rail forming resistance. Trump stated that negotiations with Iran had entered the final stage, and market expectations for the end of a US-Iran war heated up. The US dollar index softened, and LME zinc rebounded from lows, with the center shifting slightly higher.

During the overnight session, the most-traded SHFE zinc 2607 contract opened at 24,750 yuan/mt. After the open, SHFE zinc fluctuated higher, touching a low of 24,750 yuan/mt early in the session and a high of 24,930 yuan/mt late in the session, ultimately closing higher at 24,910 yuan/mt, up 120 yuan/mt or 0.48%. Trading volume decreased to 36,655 lots, and open interest increased by 2,294 lots. Overnight, SHFE zinc posted a bullish candlestick, with the 5-day moving average providing support below. On the fundamentals side, the persistent tightness in zinc concentrates continued to support zinc prices. Combined with the boost from LME trends, the center of SHFE zinc shifted higher during the night session, maintaining an overall fluctuating trend at highs.

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