Analysis of aluminum price trend in Yangtze River spot market (12.19-12.23)

Macro: Abroad, existing home sales in the United States unexpectedly rose to the highest level in nearly 10 years in November, and the third consecutive month of growth in existing home sales means that the housing market will contribute to the economic growth in the fourth quarter.
The weekly average price is around $1721, and the market mainly focuses on the $1700 support level
.
Domestically, the State Council has once again taken reduction measures to control the domestic aluminum overcapacity problem for the electrolytic aluminum industry, or provide some support for the rebound of aluminum prices, but the domestic aluminum price trend is still weak
.

Market: At the beginning of this week, the price of aluminum fell sharply, and the spot price also fell below 12,700 yuan / ton, and downstream enterprises replenished a large number of goods at a low level, and the overall transaction picked up
.
With Wednesday and Thursday, aluminum prices began to rebound slightly, spot prices exceeded 13,000 yuan / ton, holders of goods sold at a high price, but downstream procurement was cautious again, the transaction turned cold, at the same time, a large number of replenishment a few days ago, coupled with the approaching holiday, downstream enterprises suspended the acceptance of orders, Friday the current aluminum market in the impact of aluminum prices reappeared, before the weekend users replenishment confidence was damaged, the current aluminum market transaction turned weak
。 It is rumored that the shipment volume in Xinjiang has declined, while downstream enterprises are still active in purchasing below the 10,000 integer, and it is expected that next week's spot will continue to maintain the premium driven by both supply and demand, and the spot premium range is expected to be 80-160 yuan / ton
next week.

In terms of inventory: as of December 23, LME aluminum stocks reported 2150025 tons, an increase of 32,525 tons or 1.
53% from last week; In the same period, the aluminum inventory in the previous period was reported 100257 tons, an increase of 4,061 tons per week, an increase for three consecutive weeks, far lower than the average inventory value of 200,000 tons
during the year.
Data show that China's November aluminum production increased compared with the same period last year, the market electrolytic aluminum spot continued to increase, negative aluminum prices, in addition, consumption is facing the traditional off-season, social inventory into a recovery cycle, it is expected that aluminum market demand will decrease, aluminum prices in the short term or will be suppressed
.

Aftermarket analysis: Recently, foreign markets were closed for Christmas, the market sentiment was more cautious, and the price of aluminum maintained a narrow range
.
Domestically, after the government bond crisis and liquidity crisis at the beginning of the week, the cautious attitude has recovered, and the price of Shanghai aluminum has also bottomed out, but near the end of the year and holidays, some downstream smelters have suspended the acceptance of orders, and traders are also ready to close and clear goods, and the recovery in supply and weakening demand have limited the rise in Shanghai aluminum prices
.
It is expected that this state will last at least until the New Year's Day, and the price of Shanghai aluminum will also maintain a volatile trend, and there will not be a good trend next week, maintaining this week's range of 12600-13000 yuan
.