It was more of the same for aluminium on Wednesday, with the market still rangebound, bobbing up and down either with copper or in response to dollar movement. As we signed off yesterday the premarket had been very quiet and prices were hovering c. 2835, though after that they slid during the morning sessions to a low of 2821. The afternoon saw a slew of US macroeconomic data, which seemed to boost aluminium initially, rallying to 2855. However, the dollar jerked higher and traders were still uneasy about copper and an ‘overstocked’ Chinese market, so the move deflated and values sank bank to an aftermarket low of 2825.
Nearby spreads and forwards remained largely static, while two parties stayed in the 30-40% bracket of the LME’s WC warrant banding report.
Having closed weaker and with commodities being offloaded across the board, aluminium dived to 2795 in the first couple of hours of trading in London on Thursday. Locals reported CTA liquidation not only in outright terms but also in spreads, with nearby contangoes trading wider than last night’s valuations. The dollar was still climbing strongly against the yen, though after initial jitters the light metal had bounced, with technical support flagged by Cliff Green Consultancy at 2790/2800. So far the market had recovered to 2822, on improved turnover of 2,200 lots. A break of 2790 signalled falls towards the 2720 area, CGC concluded.
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