MI Comment: Bears forced to wait as aluminium surges

A funny old day at the LME asylum on Thursday. The premarket had tumbleweed blowing through it as dealers dozed and prices flatlined on zero turnover, apart from nickel which saw a rare flurry as we signed off yesterday. Aluminium had spent almost the entire morning session in a 2427-2437 range, though after lunch the market(s) sprang into life. Copper was again the protagonist as some apparent fresh fund interest came calling after US initial jobless claims reversed some of the non-farm payroll gloom of last week. Some brokers simply attributed the rise to the Jewish 'Rosh Hashanah' holiday in the absence of any other tangible reason, though rallying equities had helped lift their mood. From 2430 over lunch aluminium climbed to highs of 2485 after the pm kerb close. The only discernible movement in aluminium's super-liquid spreads was a $1.00-$2.00/mth tightening from H2 2009 to end 2011. On Friday morning it looked like traders had nodded off again with turnover at a lowly 1,200 lots to the end of the premarket session, though values remained relatively steady. Having opened just off yesterday's close the market had traded as high as 2481 with Asian equities markets playing catch-up. However, after seeing LME and SHFE stocks rise again things drifted somewhat lower, to 2467 currently. The rally had fallen short of Cliff Green Consultancy's noted nearby resistance c. 2500/10 and although underlying technical studies remained decisively bearish, a break above there would relieve the downward pressure. In the interim, the trading strategists continued to view corrective rallies as shorting opportunities, they wrote. Last at 2465.