LME aluminium to test resistance at 40-day moving average; may rise above US$2,090/t

LME aluminium is climbing higher at a moderate pace. The light metal contract which closed at US$2,047 per tonne on Monday, December 18, rose by 0.6 per cent to close at US$2,061 per tonne on Tuesday, December 19. Technical trend analysis suggests that LME will test the resistance at the 40-day moving average and range at US$2,090-US$2,115 per tonne on Wednesday, December 20.

As on December 19, LME official cash buyer aluminium price (Bid Price) stands at US$2,060.50 per tonne, cash seller & settlement aluminium price (Offer price) is US$2,061 per tonne, 3M Bid Price is US$2,080 per tonne, 3M Offer Price is US$2,082 per tonne, Dec1 Bid Price is US$2,125 per tonne, and Dec1 Offer Price is US$2,130 per tonne. LME aluminium Opening Stock or the LME aluminium inventory level stands at 1105875 tonnes, total Live Warrants is 890375 tonnes, and Cancelled Warrant is 215500 tonnes.   

SME and SHFE Aluminium Price Trend

The benchmark aluminium price on Shanghai Metal Exchange has climbed further from US$2,143 per tonne on December 19 to US$2,171 per tonne on December 20.  

In China domestic market, “bears and bulls seem prudent currently,” observes SMM. SHFE aluminium is expected to remain range-bound in the short term. There is pressure from the 20-day moving average. The contract is likely to range at RMB 14,450-RMB 14,650 per tonne today. The market is advised to focus on the capital’s struggle for RMB 14,500 per tonne.

The discounts on spot aluminium are likely to widen to RMB 230-190 per tonne, SMM said.