LME Market Commentary on the Day: LME Market: The London Metal Exchange (LME) copper futures made strength at the end of Tuesday, up nearly 1%, and other metals generally fell slightly in trading momentum. An analyst from Calyon said, “I don’t know why Stronger. In the case of buying orders, its gains are particularly significant. "A trader said," The increase in trading at the end of the session is encouraging, but I don't understand why. ""We're doing exactly that. The rallies sold off, and did not know where the buying came from. "The spreads in recent months have narrowed slightly. Traders said that the spot/three-month inverse price gap narrowed to $112/122, which was previously at $121/131. * * Copper stocks plummeted ** The persistent long-term reverse price gap had little impact on LME's copper stocks, with inventory reductions of 1,375 tons to 71,025 tons, which was the lowest level since July 1990. If you take the New York Mercantile Exchange (COMEX) Taking into account other exchanges such as Shanghai, the global copper inventory is about 140,000 tons, and up to about 800,000 tons at the beginning of the year. The Federal Reserve Board (FED) will hold an interest rate meeting on Wednesday and the United States will also publish trade data on the same day. They may affect market trends. Three-month zinc also closed lower One US dollar was quoted at US$1,079. Three-month nickel fell from US$13,850 to US$13,750. Three-month lead dropped by US$5 to US$942. LME copper: Three-month copper late-night to $2,978/ton , before the whole day around the level of Monday's closing up and down 2,951 fluctuations. LME aluminum: three-month aluminum slightly down 1 US dollars, reported 1,801 US dollars. Shanghai Jinpeng: Metal Daily Commentary (copper) 2004-11-10 night London copper suppressed by the dollar rebound The price has declined, but there has been buying in the low position, the price was quickly pulled up in late trading, the closing price continued to stand at 2950 US dollars / ton in the 2978 US dollars / ton. Other metals also recovered declines driven by copper. The overall closing price fell slightly from the previous day. On the whole, the trend of copper prices in the near term should still be dominated by oscillations. Currently, the top resistance is 3050 US dollars/ton, and the bottom is 2900 to 2850. The domestic Shanghai copper continues to perform a sharp decline, which is a near strong and weak trend. Intraday main contracts continued to increase their positions, indicating that the gap between the two sides was further increased. It is expected that copper prices should be repeated at this price point. Currently, London's spot premium still remains at a high level, and domestic tight spot situation still exists. Copper stocks continue to drop sharply. These factors still support the continued rise of copper prices. However, technically speaking, some technical indicators have entered the overbought area and prices need to be adjusted accordingly. Investors are advised to wait for the copper price correction and continue to buy and hold. (Zhang Yuan) Metal Daily Review (Aluminum) 2004-11-10 Last night, ALUMINUM fell slightly by US$1 to US$1801. Most of the time in the intraday trading session fluctuate under the level of 1,800 U.S. dollars, aluminum traded around 1780 U.S. dollars, and triggered speculative buying at the end of the trading day. Due to weak market sentiment, aluminum prices broke through the 1800s without interruption. Dollars. From a technical point of view, Aluminium is still in a state of consolidation and the market does not have a willingness to break through. The market is widely expected to raise interest rates by 25 basis points at the Fed’s policy meeting this evening. This news will provide support for the weaker US dollar. Shanghai Aluminum continued its downward trend yesterday and there is a demand for further expansion of the downside. The market price of aluminum is now falling all the way. Buyers withdraw and wait and see spot transactions at around 15,900 yuan/ton. There is no clear sell-off in the market. Under the support of the spot market, aluminum has a limited downside. It is recommended that investors avoid the weak trend at the end of the year and wait and see. (Li Ling) Interim Futures: Shanghai copper rose sharply after opening slightly higher Wednesday 11/10/2004 17:11 Shanghai copper opened slightly higher in early trading on Tuesday after LME and other international metals markets closed higher on Tuesday. Oscillation market. At the close, Shanghai copper’s major contracts all had gains of between 250-320 yuan. The three-month contract, the more active January contract, closed at 28,630 yuan, up 270 yuan from the close on Tuesday, with a volatility of 28,570-28,950 yuan and an opening price of 28,700 yuan. Two hundred million contracts have been traded in each period, of which 140,000 contracts were traded in January. Dealers said that LME's basic metals Tuesday saw copper and late-season discrepancies rise by nearly 1%, while other metals all fell slightly in quiet trading. Investors did not understand why copper rose suddenly in a quiet trading session. Copper for the third trimester closed at 2,978 U.S. dollars, up by 27 U.S. dollars from last Monday. Copper futures for COMEX copper closed higher on Tuesday. Analysts said that the early-stage downtrend opened up space for the upswing, and the bullish factors of strikes and low inventories spurred speculators to enter the market at relatively low levels to push forward copper prices higher. Shanghai copper traders believe that although the fundamentals are strong, the prevailing decline in LME market copper and the sluggish trading volume have already suggested that the market's rising momentum is not enough; after Shanghai copper has continued to rise, the day-end market has fallen. To a certain extent, the market sentiment was suppressed, and while copper prices have risen on the upside today, the oscillation trend also shows that the market needs to consolidate. We believe that since the "10.13" period of copper slump has brought heavy pressure on the market psychology, so in the near future, although fundamentals and news are favorable to the rise of copper futures, copper prices have not risen sharply. The continuous increase in the number of positions, the delay in the volume of trading volume, all show that investors are cautious and disagreement. At the same time, although the spot price/price difference between March and March continued to rise again, the inverse price difference between March/15 and March/27 did not increase significantly, far below the increase rate before “10.13â€. . Therefore, it can be said that this time the market generally holds a short-term bullish view, so when the copper price is again pushed forward step by step, the accumulated risks of the market are also increasing. From a technical point of view, although LME copper futures closed higher again on Tuesday, the trend of rising before this, but not increasing volume, has already suggested that the basis for market growth is no longer reliable. Although this does not mean that the short-term prices will fall, but only that the market needs to be consolidating. (Cai Luoyi) Hu Kaixi on the market: The timing of the strategic short-selling copper market has arrived 2004-11-09 The speculative market is always born in doubt, climbing in disagreements and ending in madness. On the day of October 13, 2004, the international base metals plummeted across the board, with LME copper plummeting about US$350, a fall of 8%, a one-day drop in excess of the Sumitomo incident in 1996 and also rare in recent decades; This week, the previous low of 3,175 U.S. dollars fell by about 16% from the earlier high, and the period of aluminum fell by nearly 8% from the high of 1,881; nickel also unexpectedly plummeted by 2,625 U.S. dollars, falling by as much as 16.3%. The fifth largest single day decline. In addition, aluminum fell 5.3% and zinc fell 6.3%. The entire plummeting of the base metals suddenly ended the three-year bull market. 1. Funds rapidly lighten up, the bull market has ended? Funds are undoubtedly the initiator of this wave of gains. In the process of pushing prices up in September, the LME and COMEX copper markets have been out of a Masukura state, and the CFTC positions report shows the net of funds. Many locations have also surged to nearly 30,000 hands for three consecutive weeks. The Masukura of the aluminum market has become even more fierce, from 35 hands a month ago to nearly 450,000. From the perspective of changes in the positions of base metals, the positions of base metals such as copper and aluminum are increasing in the process of pulling prices up to their respective higher points. However, during the collapse period around October 13th, 2004, the market reported that the fund was substantially liquidated, and that a large number of stop orders were triggered, which resulted in a straight-line price drop, and the decline was extremely amplified. . In just a few days, the fund’s net longs have been quickly reduced from nearly 30,000 hands to 10,000. The fund’s cut positions are shocking and admirable. What does the “prophetic vision†have for funds that follow trend transactions and have strict stops? 2. The macro economy may slow down. The US GDP growth rate in the third quarter, September industrial output, the New York Fed’s October manufacturing index and the University of Michigan’s consumer confidence index in October were all lower than expected, and there was no news of encouraging the market. On October 28, 2004, the People's Bank of China decided to increase the benchmark deposit and lending rates of financial institutions from October 29. China suddenly announced a rate hike after more than nine years, eliminating the market's uncertainties. For several months, the market has been expecting that China may adopt tightening monetary policies such as raising interest rates in order to cool the economy. Therefore, the market has carried out too much speculation in advance on this bad object and has fully digested it in advance. This time in the market accidentally baked out of the accident, but it is beneficial to vacant results, the negative impact on the market is more psychological. The slight increase in interest rates by 27 basis points this time is obviously a symbolic measure. The purpose of raising interest rates is to transmit a clear message or issue a warning signal, that is, the government will continue macroeconomic regulation and control, further consolidate the achievements of macro-control, and "cool down" the still-overheated economy to achieve a soft landing. 3. The appearance of phenomena is difficult to last. Due to the low inventory in Shanghai, and it is still the peak season for consumption, the Shanghai spot is firmer. The purchasers' willingness to purchase will increase. The fundamentals of supply of local tension brought potential support. LME stocks fell, labor disputes and production declines brought stability to the market. In addition to reacting to the tight spot, it may also be related to the rumors that the State Reserve will receive 30,000 metric tons of firm in December to replenish inventory. Even though the dollar fell to near the end of the year to stimulate metal prices, speculators have turned their attention to record oil prices and their potential damage to the world economy. The market has always believed that industrial metals have strengthened as oil prices have risen, and market participants who buy metals have suddenly discovered that this logic is “economically uncertainâ€. In fact, the routine of “the depreciation of the dollar and the rising price of copper†is also a castle in the air. Economic recession, how to support? 4. Price is a better weapon to regulate the contradiction between supply and demand. Although news from the LME annual meeting has shown that the fundamentals are still positive. But it is precisely this one-sided magnetic field that underlies the reverse theory. Although the base metals face downward pressure in the second and third quarters of this year, the decline is significantly smaller than that of the agricultural products market. Especially since September, the industrial markets represented by the copper market and crude oil have emerged a strong unilateral upward trend, and the trend has been thorough and agricultural products. Differentiation occurs. Looking ahead, the prices of basic metals and energy markets are still facing a greater risk of rising. Looking at the supply chain, a big difference between raw materials and agricultural products is that the supply of agricultural products is easily regulated by price signals. This year, more species have fallen in price, and in the second year, they will have less species and prices will rise. Influencing factors of weather conditions, the trend of food prices shows a clear annual cycle. However, for commodities such as energy sources and basic metals, due to the long supply chain, there is a long time lag from the exploration and development to the effective supply of final supply, which in turn makes the market in the face of tight supply and strong demand. At that time, the time period for regulating supply was very long and there was a significant lag. Take Copper City as an example. Although raw material prices have risen sharply in the bull market since last year, copper concentrate production has increased and TC/RC costs have improved significantly. However, the supply of refined copper remains relatively large. Uncertainty, whether the strike or any other factors affecting supply, will aggravate the current tight balance of the copper market. The International Copper Research Organization recently pointed out that the increase in global copper mining capacity utilization rate, coupled with the expected slowdown in global refined copper use in the year of 2005, will bring the global refined copper supply gap to 220,000 tons in 2005. Global refining in 2004 Copper supply gap will reach about 701,000 tons, which will be higher than the level of 376,000 tons in 2003. It is estimated that the global refined copper demand will increase by 5.7% in 2004 and will increase by 4.1% in 2005. The average production cost of refined copper in the world is roughly around US$1,450/tonne. The current price of copper makes copper mines extremely profitable. The market rules will regulate commodity prices. Over the past year or so, the global copper price has soared. The miners who have been plagued by the low price of copper for many years have regained profits. Copper mines around the world have resumed production. Under the influence of the law of value, the copper market will eventually shift to a balance between supply and demand. BME Co., Ltd. and Standard Bank expect that the global refined copper supply gap in 2005 will narrow on the basis of 2004. Goldman Sachs, an investment bank giant, expects that the global supply of refined copper will surpass 314,000 tons in 2005, and its global refined copper supply gap is expected to reach 0.41 million tons in 2004. In 2005, the global surplus of refined copper supply will appear in the second half of 2050. . It should not be forgotten that copper prices of US$1.00 (US$2,200 per ton) per pound are already very good prices for mineral companies. 5. Technical signals send bad signals. From a technical point of view, in addition to shocking investors in the history of rare free fall long Yinxian, the price of copper broke through the 2860 line, and the callback of the 5th wave of the 4th wave has not been established and the technical charts have been greatly damaged. Starting from this point, it can basically be concluded that the bull market is over. Due to the recent large decline, the 233-day moving average support, there will be oversold bounce. After a sharp decline, LME copper prices are expected to rebound to the high of 2980 in March, build a complex top, and then oscillate down. According to a comprehensive analysis, the bull market in the global copper market has ended, and the conversion of the bull and bear market will be in the second half of 2004. The long bear market cycle will also begin. The timing of the strategic short-selling in the copper market has come. Jinrui Futures: The copper price is appropriate long 2004-01-09 16:40:14 The price of Lun Copper rose on Tuesday and opened at 2951 US dollars in early trading. The higher price was 2980 U.S. dollars, and the lower price lowered to 2930 U.S. dollars, ending at 2978 U.S. dollars. The close was up by $27 over the previous trading day. The trading volume shrank slightly to 58882. Open interest has increased. Today, Shanghai copper saw a sharp decline. Since the Fed meeting will decide whether to raise interest rates and forecast economic prospects tonight, the basic metals market is more cautious. The main contract CU0501 opened in early trading at 28,700. The higher price rushed to 28,950. The lower price went down to 28,570 and the late price was reported to 28,630, up by 80 yuan over the previous trading day. Both transactions and positions have increased. The impact of Shanghai copper's decline at the early opening of the market was weaker last night. However, due to the buying momentum, the price of the market rose rapidly from the previous oscillation range and tested to the 2980 line. The drop in crude oil price last night caused the price of the US dollar to be slightly lower. There is a rise, which brings certain pressure on copper to a certain extent. However, as the US dollar is still close to the euro from the previous lows, there is no sign of falling out of the downtrend. Therefore, it is expected that the U.S. dollar will have a limited rise, and there will be further decline after the rebound. In terms of inventory, inventories are still falling, and spot premiums will continue to remain high. Operationally, it is recommended that the long-term focus should be based on long positions. (Jinrui Futures Sundi) Shida Futures: Shida Early Commentary - Investors Are Cautious, Highly Concussed 2004-11-10 9:04:07 Tuesday Shanghai copper has taken advantage of a surge in prices and then fell back under long liquidation and short blows. The high open and low prices appear to mean that the price of copper will face a short-term adjustment process. In the evening, the price of copper will decline slightly due to the rebound of the US dollar. However, the buying will reappear. It will quickly rise in late trading (after about 12 pm) and close. 2978 above 2950. Other metals also recovered their losses under the lead of copper, and the overall closing price fell slightly from the previous day. · The dollar's decline was suspended, with a slight rebound. European officials started to scribble on the dollar's decline. The dollar rose slightly on Tuesday, and the Federal Reserve will hold an interest rate decision meeting on Wednesday. The market expects the federal funds rate to rise by another 25 basis points to the dollar. support. The base metal also slowly declined before the late gains. · High price volatility The short-term trend is easily affected by uncertain factors such as technical trading orders and it is difficult to predict. As a whole, the recent market is still dominated by shocks, with the top resistance at $3,000/ton and the bottom support at 2930/40. Then it is 2850. Domestic market tensions still support price strength. Shanghai Copper (Huatong) spot is between 31,000-200 yuan/ton for three consecutive days. The spot market report states: “Most consumer companies stated that if the price of copper is around 31,000, the product can maintain capital, then They will also maintain production until the end of the year. If the copper price is around 32,000, it will be difficult to accept and may temporarily stop production." According to the current immature import conditions and the State Reserve may buy aluminum ingots, the spot price of domestic market is high It will remain within, but consumer affordability also limits the breakthrough above 32,000. If the price of copper is kept high, this situation will be difficult to break. · LME aluminum water continued to fall Aluminum spot premium fell to 2.3/4.3 USdollars/ton, highlighting that the December premium for December contract was quickly reduced to US$2/tonne, and the contracted month contract has basically come to an end. The change in LME aluminum premiums and premiums is more bizarre. In March, the long-term premium was once again increased. • The aluminum market in Shanghai Alcoa's costly price zone is weaker than expected. The domestic and international ratio fell step by step. During most of this week, the ratio of Shanghai and Shanghai to the three-month period has reached a position near 8.7. After the formation of the aluminum price decline, we can find a series of reasons for falling: Earlier, this year, electrolytic aluminum companies suffered more losses, loans were also controlled, liquidity was relatively lacking, and at the end of the year, companies needed funds to prepare raw materials, etc. Therefore, the aluminum plant is eager to clear inventory. Second, the effectiveness of the tightening policy gradually emerged, and the growth rate of aluminum for real estate and automobiles began to slow down. Third, consumers are bearish on aluminum prices and are reluctant to enter the market during the price drop. Fourthly, there are even some analysts who believe that the central export may have come to an end, and aluminum ingots in the domestic market have re-emerged. Relatively certain objective conditions are sufficient sources in the spot market. The more important source may lie in psychological expectations. Traders are not optimistic about the market, producers take the initiative to sell, and sellers do not buy actively. The futures price seeks a new balance point in anticipation of the cancellation of export tax rebates and appreciation of the renminbi, and the spot price also falls. (Pang Ying) Wanxiang Futures: Copper Market Moves in Adjustment Status 2004-11-11 8:40:24 Closer drop in oil prices is clearly on the front-end contract on the continuous curve of its contract, reflecting short-term bearishness Factors, mainly the weakness of the spot market, China's quiet buying over a period of time and the decline in the price of pre-heat oil prices drastically changed the price difference between contracts. The weak dollar from the contract's continuous price curve inspired many earlier Consumers who did not maintain their value at the current price locked the price. As a result, the two-year forward price of NYMEX oil fell by only 50 cents in the past month (only one-tenth of the decline in previous prices). Its current price of $42.51 is still only lower than the historically high of $2.10 in late October. At the same time, we think it cannot be ruled out that the preliminary contract of the price curve will fall further in the coming week, and the fundamentals still suggest that the price may have a new high. Especially in the coming months, if the northern hemisphere is colder than normal this winter, we expect strong Chinese imports to recover soon, Friday The cloth's CFTC data shows that the fund now holds a very large short position in crude oil and oil products, especially in heating oil, and the fund’s current headroom is the first time since February. The level of US deposits has been low for a long time. At normal levels, the market may have a strong rebound, once low temperatures begin to appear in major US consumer regions. In terms of metal fundamentals, mining investment forecasts have grown by 58% this year to reach $35.50 billion. A survey of new mining development spending in the world shows that this report was published by the Metals Economics Research Group (MEG). In the same year, the global mine price was only $1.9 billion due to low prices. The consultancy emphasized that high metal prices are a key driver of growth in investment spending. Emerging companies play a more important role in investment growth than large companies. They benefit from fair competition. MEG expects the same in 2005. Status, to newcomers, especially in the case of increasing the amount of funds to take more opportunities. Usually half of the world's mining investment budget for the development of gold. Latin America continues to be a developer. Their share of development is 22%. Their investment is 19.6% in Canada and 16.1% in Africa. However, Russia, Mongolia, and China are also more popular. The total development capital expenditure is US$355 million. It is three times that of 2003. Although today's important Federal Reserve decision and U.S. trade data were announced, and drastic exchange rate fluctuations were triggered, the trading volume of the copper market and other major base metals fell to a recent low level today. While the Shanghai market has experienced sharp price fluctuations, LME's trading volume in Asia was less than 10,000 lots. Scattered fund buying related to exchange rate fluctuations is still under pressure from long-term producers. Professionals are short-selling in recent transactions, but apparently there is no clear performance in today's trading. The difference is that COMEX's transactions appear to be actively trading due to the gradual status of the move-out transactions, and trading volumes have also begun to increase. With the approaching of the third Wednesday of the LME, the move of the LME expired contract will be completed before the next Wednesday. Since the end of November is the gratitude of the United States at the end of November, the move of COMEX may be performed earlier than usual. Today, the price of copper is in a relatively stable state of adjustment. The stable price of the LME market provides strong support for the COMEX market that has entered the state of moving warehouses, as the stage of the COMEX move is mainly aimed at between December and next March. Spread trading, so it will not have a significant impact on the current price trend. Short-term technical short-selling may see further corrections next week, but the current adjustment of my personal views is very orderly. Therefore, the possibility that the medium-term price will continue to rise is also more apparent.