On Tuesday, LME Aluminum continued its adjustment pattern, dropping by US$20 and closing at 1860 US dollars. With 88,870 lots of transactions, the market was more cautious and the trading volume was shrinking compared with the previous trading day. The overall wait-and-see atmosphere was strong. In terms of inventory, LME aluminum stocks decreased by 3,500 tons on Tuesday. The current total inventory is 508,475 tons. With regard to the fall in the LME aluminum futures price on Tuesday, market participants believe that this was mainly due to the drop in crude oil prices. As a relatively strong financial asset, metal aluminum futures are associated with many economic factors, including crude oil prices. Investors believe that due to the decline in crude oil prices, the fund is likely to take profits. In order to evade this risk, quite a few investors choose to wait and see. However, from the perspective of fundamentals, some research institutions and enterprises are still optimistic about the future development of the aluminum market. Russia’s Rusal stated on Tuesday that “it is expected that aluminum demand will continue to climb in the next five years, which is mainly due to the continuous increase in demand for aluminum from China and India.†India’s aluminum output also reached 378,728 tons in April-August. Increased by 9.4% year-on-year. At present, the relationship between supply and demand in the market is relatively complex, and the Lidopoly factors are intertwined, making it difficult to judge the market direction. Therefore, both long and short sides have adopted a more conservative operation strategy, and LME aluminum futures price will continue to find direction in the shock adjustment.
From the domestic situation, the Shanghai aluminum futures price is relatively strong compared to the previous period, which is mainly due to the high cost of production constitutes an effective support for the price. China is a big country in aluminum production and consumption. Subtle changes in the supply and demand relationship in the market can have a crucial impact on futures prices. In addition, on the eve of the National Day, the need for database preparation by enterprises has become increasingly strong. It has also boosted the price from another perspective. However, due to the lack of liquidity in the Shanghai aluminum market, both long and short-term operations are more cautious. Combined with the small market capacity, it is very difficult for futures prices to fluctuate within a relatively small price range.
Today, Shanghai Aluminum's 0511 contract opened at 16,580 yuan, with a higher price of 16,580 yuan and a lower price of 16,540 yuan, closing at 16,570 yuan. 1328 lots were traded throughout the day, and volume was shrinking.
Operation: wait and see, waiting for the right opportunity to enter the court.
(Zhao Wei)
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