LME aluminium dips on Chinese inventory gain and rising US dollar index

After making a strong start to the New Year, LME aluminium fell slightly as US Dollar index consolidated daily gains by rising to 92.25 from the previous mid-91.00s. The dip was also partly driven by the Chinese refined aluminium inventory data which touched record highs in November. The light metal contract fell from US$2,256 per tonne on January 2, to US$2,241 per tonne on January 3, Wednesday.

Technical analysis suggests that LME aluminium will remain weak and range below the 5-day moving average at US$2,200-2,240 per tonne on Thursday, January 4.

As on January 3, LME official cash buyer aluminium price (Bid Price) stands at US$2,240 per tonne, cash seller & settlement aluminium price (Offer price) is US$2,241 per tonne, 3M Bid Price is US$2,251 per tonne, 3M Offer Price is US$2,251.50 per tonne, Dec1 Bid Price is US$2,325 per tonne, and Dec1 Offer Price is US$2,330 per tonne. LME aluminium opening stock stands at 1101800 tonnes, total Live Warrants is 850975 tonnes and Cancelled Warrants 250825 tonnes.

The Asian reference price for LME aluminium (3-months ABR) is US$2,242.97 per tonne.

SME and SHFE Aluminium Price Trend

The benchmark aluminium price on Shanghai Metal Exchange has dropped from US$2,255 per tonne on January 3 to US$2,244 per tonne on January 4.

On Shanghai Futures Exchange, SHFE aluminium price movement on January 3, as updated by Shanghai Metals Market, was as follows:

SHFE aluminium is expected to stay weaker in the short term with support from the moving averages. SMM thinks SHFE aluminium will test support at RMB 15,000 per tonne and range at RMB 14,980-15,210 per tonne on Thursday, January 4.