SHFE Zinc Recorded a Bearish Candle, Zinc Prices Expected to Maintain Fluctuating Trend [SMM Zinc Morning Comment Nov 1]

Overnight, the YoY growth rate of the US September PCE Price Index fell to its lowest level since early 2021; initial jobless claims in the US decreased last week; foreign media reported that Iran is preparing to launch a large-scale retaliatory attack on Israel using armed forces in Iraq; the Bank of Japan kept its policy rate unchanged; Russia imposed an astronomical fine on Google, amounting to 35 digits; the sixth meeting of the China-US Financial Working Group was held; China's PMI for October rose MoM for two consecutive months and returned to expansion territory; six major banks will implement a new mechanism for adjusting the mortgage rate on existing home loans.

Overnight, LME zinc opened at $3,078.5/mt. At the beginning of the session, LME zinc fluctuated rangebound around the daily moving average, then climbed to a high of $3,129.5/mt. Subsequently, LME zinc fluctuated downward below the daily moving average, attempted to rebound from the low but was ultimately blocked and fell back to a low of $3,015.5/mt below the daily moving average. By the end of the session, LME zinc slightly moved up and closed down at $3,037.5/mt, down $49.5/mt, a decline of 1.6%. Trading volume increased to 122,000 lots, and open interest increased by 2,152 lots to 255,000 lots. Overnight, LME zinc recorded a bearish candle, with the upper Bollinger Bands forming resistance and the lower Bollinger Bands providing support. LME social inventory increased by 5,500 mt to 246,725 mt, an increase of 2.28%, recording an inventory rise. Currently, the US September PCE Price Index YoY growth rate recorded 2.1%, the lowest level since early 2021, and initial jobless claims in the US decreased last week. LME zinc is expected to maintain a fluctuating trend today.

Overnight, the most-traded SHFE zinc 2412 contract opened at 25,235 yuan/mt. At the beginning of the session, SHFE zinc fluctuated rangebound around the daily moving average, reaching a high of 25,260 yuan/mt. Subsequently, longs reduced positions, and SHFE zinc fluctuated downward below the daily moving average to a low of 24,810 yuan/mt. By the end of the session, shorts increased positions, and SHFE zinc slightly moved up, closing down at 24,875 yuan/mt, down 400 yuan/mt, a decline of 1.58%. Trading volume decreased to 106,000 lots, and open interest decreased by 6,946 lots to 115,000 lots. Overnight, SHFE zinc recorded a bearish candle, with the upper Bollinger Bands forming resistance and the 40-day moving average providing support. Currently, domestic supply remains tight, and TC is still at a low level, while overall domestic demand is also weak. SHFE zinc is expected to maintain a fluctuating trend, with more macro data anticipated in the future.