LME Week ended with a whimper on Friday with volumes below average, though prices improved on better-than-expected US economic readings. Aluminium had a quiet morning session, staying in a 2470-2485 trading range after large stock landings failed to materialise. The net cost of production in China was set to rise after the elimination of power subsidies, while buy-side forward options enquiries kept
LME dealers on their guard. As US traders rejoined it looked like there were still some shorts about, as prices accelerated higher on a break above 2490, peaking at 2515 over lunch. From there values came off to 2485 in the pm sessions, only to rebound at the kerb close.
A small backwardation reappeared in the back end of 2009, while contangos in the first half of the year narrowed by up to $2.00/mth. The rest of the forward structure tightened marginally, putting the 3m-Dec 2011 at only 5.00c, in from 30.00c.
Trading resumed unchanged on Monday morning, though on light turnover prices had lifted as far as 2530 currently with a rallying euro/dollar boosting the whole metals complex. Locals reported a renewed sense of 'bullishness' around the market, with the 'China story' dominating last week's jamboree in London, while oil and precious markets were also on the up. However, with aluminium putting no more than 1,000 lots on the
LME Select board at time of writing, it remained to be seen if the market was capable of taking out technical resistance hereabouts.
Cliff Green Consultancy had put their first resistance level around 2530/40, with a failure to break up likely to bring renewed bouts of weakness. Last at 2528.
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