Aluminum aluminum futures weak adjustment technology adjustment pressure has increased

Today's Asian aluminum futures for the 3-month contract showed a weak consolidation, underperforming compared to copper and Shanghai Aluminum. The main contract for aluminum in three months closed down by 0.29% at $1,871. Given that the key psychological level of $1,300 remains as a significant resistance, and with the MACD histogram on the daily chart gradually shrinking, it suggests that short-term technical pressure is increasing, indicating a potential correction in the near term.

In the spot market, on April 25th, the price of aluminum at the Yangtze River was quoted between 13,380 and 13,420 yuan per ton, with a premium ranging from 75 to 35 yuan per ton. This marked a noticeable narrowing of the premium compared to the previous day. According to SMM, although there was a reversal in aluminum plate prices, the increase in pick-ups over the weekend and the pricing psychology of holders kept the price high, leading to a sharp drop in the spot premium. The premium nearly flattened against the current month’s aluminum, signaling that the market is still dominated by bullish sentiment, with active trading continuing across the board.

Looking at the inside plate trend, the main contract for Shanghai Aluminum, 1407, experienced a mixed movement today, closing down 0.84% at 13,575 yuan. It hit a yearly high of 13,760 yuan in February, but faced support around 13,500 yuan per ton. Currently, the aluminum market's term structure remains in a positive contango, with a low level and a high level. The positive price spread between the 1406 and 1407 contracts stands at 60 yuan per ton, slightly narrower than the previous day.

Market analysis shows that both Germany's IFO Business Climate Index and the U.S. Durable Goods Orders data released yesterday exceeded expectations, boosting overall market sentiment. In Asia, Japan reported a 1.6% year-on-year rise in CPI in March, the highest in record, which may reinforce the central bank's expectation of maintaining interest rates unchanged on Wednesday. In Europe and the U.S., there are no major data releases today. Within the aluminum sector, Citigroup forecasts that annual aluminum production will increase by 4.9% to 52.7 million tons in 2014, with demand rising by 6%. This could further tighten the supply-demand balance. However, this year's capacity is expected to see a small surplus of 162,000 tons.

Market participants noted that today's Shanghai Aluminum futures opened weaker than copper, partly due to the excessive gains seen over the past two days, which triggered short-term technical corrections. Despite this, the decline in aluminum futures remained limited due to the upward movement in copper during the day. For traders, it is advised to be cautious when approaching the 13,500 yuan level for the 1407 contract in the evening, with attention also given to the resistance level at 13,750 yuan.