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Barclays: Heavy selling in LME aluminum leaves it vulnerable to short covering rally
Edited by : AL CIRCLE
1 min read
Base metal prices have been falling sharply in recent days as disappointment grows following the EU summit, said Barclays Research in a research note.
According to Barclays, aluminum is facing selling pressure with LME open interest still reaching new records highs daily. This leaves aluminum increasingly vulnerable to a large short-covering rally.
The banks noted that there was another large increase in LME inventory today of 96,000 metric tons, and again into Vlissingen, Europe.
“We continue to believe that this is metal that has been around for a while but which is now being moved on-warrant due to the recent tightening in nearby spreads,” bank concluded.
According to Barclays, aluminum is facing selling pressure with LME open interest still reaching new records highs daily. This leaves aluminum increasingly vulnerable to a large short-covering rally.
The banks noted that there was another large increase in LME inventory today of 96,000 metric tons, and again into Vlissingen, Europe.
“We continue to believe that this is metal that has been around for a while but which is now being moved on-warrant due to the recent tightening in nearby spreads,” bank concluded.
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