After the excitement of Friday followed an indifferent session for aluminium on Monday, making the high (2835) before we signed off. As lead and zinc moved higher on sound fundamentals and renewed CTA interest, the 'major' metals languished, aluminium trading sideways above 2800. Prices bottomed very briefly at 2780, though continued nervousness over a December liquidity squeeze ensured that the market rebounded quickly. In the end 3-months values ended more or less unchanged, though the C-3m period relented.
Interim carries within the spread all ended linear with Jan-Feb swinging back from 2.00b to 4.50c. The forwards almost all hung on to gains made on Friday with the only exception being Mar-Apr'07, which fell from 11.50b to 7.25b. Movement was minimal after that. Levels of market interest in the usually empty WC warrant banding report remained strong this morning, with one party doggedly remaining in the 50-80% bracket as at cob Friday (the report is two days delayed). A step up in that percentage tomorrow was a stronger possibility with a whopping 25,000t taken out of play in today's stocks report…
The headline stocks (as opposed to *warrants*) movement left traders unimpressed Tuesday, rising a net 100t. It took a while for news of the mega cancellation to take effect, as prices hardly budged from opening levels of 2810 for a few hours. In the closing stages of premarket trading values suddenly began to move, lifting strongly to a high of 2843 currently, though volumes had yet to pass the 2,000 lot mark. Fund watchers reported fresh money coming into the commodities complex with oil leading the pack.
As at last night, technicians Cliff Green Consultancy considered a test of resistance c. 2840/60 to be "likely" with success or failure to break higher dictating the direction of the next short term cycle, they wrote in a report.
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