Mid-term Jiahe: Subtle changes have taken place in Aluminium and the direction has begun to blur

Yesterday, LME suffered a strong upward trend due to the impact of the entire market, rising sharply by US$40. It closed at 1,854 dollars. Transaction volume was 111,359 lots. Trading volume shrank significantly compared with the previous trading day. Trading was not active. The atmosphere of the market began to be strong and short-term confidence faded. During the same period, LME aluminum stocks fell by 1,125 tons, and the total inventory is currently 518,800 tons. For yesterday's rise in London Aluminum, mainly affected by three aspects. The first is that the strengthening of the fund's metal market has begun to show its leading role in the period. Second, since aluminum is also a futures product with very strong financial attributes, the impact of hurricanes will also have an impact on futures prices. Third, with the declining stocks yesterday, the bullish funds showed some bullish bias towards the aluminum futures market, although it is not obvious. At the same time, the short funds on the floor also cast doubt on the direction of the market. Both parties are more cautious in their operations. From the shrinking volume, it can be seen that both long and short sides are cautiously operating and watching, hoping to wait for a clearer market direction. From the perspective of market operations, the LME market short should change its operational thinking and be cautiously held to wait for market changes. The bulls still should not enter the market for the time being.

In the domestic market, the rise in alumina prices has already made aluminum smelting companies overwhelmed. In the first half of this year, more than half of aluminum smelters were losing money due to high alumina prices. Due to the high alumina price, objectively, the price has gained rigid support. At present, aluminum smelting companies are preparing to establish an import alliance in hopes of obtaining relatively low-cost raw materials in the international market to control costs. In the futures market, due to the shortcomings of aluminum itself and the characteristics of the domestic spot market, the price of futures is more developed around the needs of the domestic market, and the impact of price fluctuations in the international market is not great.

Today, Shanghai Aluminum's 0511 contract opened at 16,520 yuan, with a higher price of 16,520 yuan and a lower price of 16,490 yuan. It closed at 16,500 yuan at noon.

Operational: The bears continue to be held cautiously.

Zhao Wei

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