As we signed off on Tuesday aluminium was heading towards the top end of its broad range with nearby contangos narrowing too. The market had climbed from 2861 to 2894 in reasonable turnover with the rest of the commodities complex stronger on the back of surging oil and precious metals. However, just as it looked possible that last week's metals-wide shakeout had been just that, momentum faded and prices came off just as rapidly, with producer selling for 2009 said to be the main feature. All the base metals, except lead, came off in concert on speculative selling and the light metal skidded to 2840 at the late close.
Nearby spreads ended unchanged after seeing better bids during the morning session, while forward rates softened marginally to 2009 and tightened by $0.50/mth in 2011/12. An update on the LME's WC warrant banding report was unavailable currently.
The slide continued on Wednesday morning with values falling to a low so far of 2818 after making a high shortly after the opening at 2848. Volumes stood at a lowly 1,250 lots. Support was visible c. 2770/90 with a clear and sustained break below there signalling falls towards 2720, according to Cliff Green Consultancy. Last at 2822.
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