The imminent arrival of December, possibly accompanied by fresh allocations to metals by fund managers, had put aluminium's slide on hold this week. Despite a generally bearish feeling for everything except zinc and nickel, the month-end was marked by 'window dressing', talk of a squeeze on Dec 21 (still), but also index (long) rolls and forward borrowing by prospective sellers. It amounted on Thursday to a net gain of $38 day-on-day, after first slipping from 2714 in the premarket to 2692 in the morning sessions. The dollar's inexorable slide aided matters and the ensuing break above the 30-day moving average coincided with a newswire story, suggesting that a new tax on Chinese billet exports was being considered by Beijing. In the final analysis it was an unremarkable day with only average levels of business.
Nearby spreads were unaltered, while forward rates steadied incrementally to the end of 2010. Unusually for aluminium, one party had crept up to the 50-80% holdings bracket of the LME's WC warrant banding report. The report totals holdings of Warrants, Tom and Cash positions held by individual (on or off-market) parties and reflects them as a percentage of the LME's total non-cancelled inventory.
The positive close above the 30-day MA brought on more short-covering on Friday morning, though traders were also rattled by some shenanigans in Tom/Next dealings. Having changed hands at $0.50b in electronic trading in the premarket, the first session saw Dec04-05 flare out to $5.00 backwardation (!) on turnover of some 1,000 lots. Before then, outright prices had opened in Asia c. 2730, lifted to 2755 in good volume and then come back to a current low of 2727. Technical resistance remained up to 2740, according to Cliff Green Consultancy, with a 'clear and sustained' break above here required to extend the run towards 2800 and even the 2850 region, they wrote.
豫公网安备41010502003434号