Daily Report 200716 2016-07-20
Wednesday copper price meet bolster at 5 day average line, and slightly increased. Fundamental side, Tuesday LME storage continued decreased 3125 tons to 226000 tons. Spot discount slightly narrowed $0.75 to discount $16.25. Supply side, BHP output of 2016 was 1.58 billion tons, and decreased 8% year-on-year. Output increase and strong operation partly offset the output decline of Escondida. Second season copper output decreased 5% year-on-year to 400000tons. Output of Escondida decreased 20% year-on-year to 268000 tons. Technically, copper price is near the resistance line of $5000. If don’t break this price, the motion of price rolling back will happen. Close the position at 10 days average $4870. Domestic resistance place is RMB 392000, and close position at RMB 378000.

Domestically, DCE soybean maintains fluctuation. Night section dropped influenced by overseas section. Soybean No.1 contract dip after national inventory soybean auction. Soybean meal still follows overseas section. Northeast China soybean continued drop tendency, and purchasing price of several places drops significantly. Traders claim that old grain auction strike on market. Traders are unwilling to purchase. Soybean meal side, spot goods continued dropping, and several places dropped RMB 20-40/ton, which is mainly influenced by domestic inventory overstock. Recently costal oil plant soybean meal inventory is under pressure, as a result of flood area breeding industry. Oil plants of several places have the problem of sales and inventory overstock. We consider that recent weather influence is short-period, and market emotion reflection is larger than the real influence. Short-term maintain fluctuation tendency.

Yesterday PP futures fluctuated at low point; opened at 8080 and closed at 8051. Trading volume increased 176000 lots to 721000 lots. Holding volume decreased 77114 lots to802000 lots. Spot goods side, yesterday PP market was stable and loose, and partial price slightly deceased RMB 50-100/ton. PP futures operate at low price position, stroke to market mindset. Part of producer price of petrochemical decreased, and bolster for the market costs weakened. Intraday main quoted prices for wires of north China, east China and south China markets are RMB 7800-7950/ton, RMB8050-8300/ton and RMB8150-8200/ton, respectively. Currently moving average system twines. MACD green column lengthen, which is rolling back tendency.
                                                                        Dong LV (Investment Certificate NO. TZ008452)