Analysis of copper price trend in Yangtze River spot market (3.20-3.24)

On the macro front, data from the U.
S.
Department of Commerce showed that the annualized total of new home sales in the United States in February was 592,000, higher than the expected 564,000 and a seven-month high
.
The optimism of new home sales in the United States indicates that the real estate market is performing positively, which shows that the US economy is relatively strong and the basic direction will not change
.
At present, the market is more concerned about the tax reform vote, if it is postponed or affected by financial market sentiment
.
Domestically, China's end-of-quarter "money shortage" is still spreading, which will inevitably suppress the financial market, although the stock market is stable, but the upward momentum of the futures market has been significantly suppressed
.
In addition, the government tightened the real estate policy, and the real estate regulation policy was upgraded again, following Beijing, Guangzhou, Changsha, Shijiazhuang and other cities to start or increase the purchase limit, Chengdu also joined the control camp, according to incomplete statistics, since March, 21 cities across the country have started or upgraded purchase
restrictions.
Real estate is facing a double backlog of funds and purchase restrictions, which has formed a certain suppression
of relevant commodity price expectations.

Market: at the beginning of the week with the correction of the market, the holders tried their best to narrow the discount, the discount narrowed from 230-130 yuan to 180-80 yuan / ton, but with the common outflow of value-preserving sources and delivery sources, the market is rich in supply, and the financial pressure is becoming more and more obvious, after the week copper premium is difficult to hold, some traders sell, resulting in the expansion of the discount to 200-140 yuan / ton, the downstream consumption in the week to maintain rigid demand, no obvious scale into the market, middlemen have to receive goods with higher cost performance at a low price, for long-term order delivery
。 Due to the continuous reduction of import sources during the week, the price difference between wet copper and flat water copper was continuously compressed, and there was almost no price difference at the weekend, and the characteristics of the capital-dominated market were obvious
.

In terms of inventory: London copper stocks continued to decline this week, with a cumulative weekly decrease of 25,075 metric tons to 312525 metric tons, a cumulative decrease of 7.
43%.

Hit a low level in nearly half a month
.
The average LME spot market discount has widened this week, with the LME spot discount averaging $27.
25, up from
last week's discount of $20.
25.
The domestic spot market maintained a discount this week, with a discount of 200-110 yuan on Friday, and the overall market supply was sufficient, and the downstream has never seen a scale into the market
.
The spot trade import window continued to be closed this week, but the import loss was not large, and the Yangshan copper premium remained at $
43 during the week.
So far, the market is still waiting for the arrival of the consumption season, and it is still necessary to wait and see how
market demand changes in the later stage.

Future market analysis: At present, the copper market coexists long and short, although there is still some uncertainty in the supply outlook, but the lack of improvement in downstream demand makes copper prices weak
.
On the supply side, Chile's largest copper mine announced the resumption of production, but mine production in Peru and Indonesia is still affected, from the recent decline in copper prices, the market can basically digest the news of resumption of production, next week's bearish news may have less
impact.
Overall, next week is the last week before the Qingming holiday, some domestic investors may choose to leave the market, and the copper market may be weak in volatility next week
.