Shanghai Copper Continued to Rebound, but the Reserve Fell Short of Expectations

　　Internal and external trends: LME copper continues to rise in shock today. As of 15:00 Beijing time, the three-month LME copper price was 9347 US dollars/ton, a daily increase of 0.84%. Shanghai Copper’s main 2108 contract continued to rebound, with a daily maximum of 68650 yuan/ton, a minimum of 67370 yuan/ton, and a closing price of 68590 yuan/ton, which was 1.66% higher than the closing price of the previous trading day; trading volume was 101248 lots, a daily increase of 152 hands; open positions 109,276 hands, a daily reduction of 4330 hands. Basis -370 yuan/ton; Shanghai copper 2107-2108 monthly price difference -110 yuan/ton.

　　Market focus: (1) Powell stated at a hearing held by a panel in the US House of Representatives that we will not raise interest rates early because of concerns about possible inflation, and we will wait for evidence of actual inflation or other imbalances. (2) According to the 2021 Announcement No. 2 of the State Bureau of Grain and Material Reserves, it is decided to start putting the first batch of national reserves of copper, aluminum and zinc in 2021, which will be 20,000 tons, 50,000 tons, and 30,000 tons, respectively, in July. Open bidding on the 5th to 6th.

　　Spot analysis: On June 23, spot 1# electrolytic copper price was 68100-68340 yuan/ton, the average price was 68220 yuan/ton, and the daily increase was 1020 yuan/ton. The Yangtze River Nonferrous Metals reported that, as a whole, there were more exports and less demand, and the demand continued to decline. The shipments were dominated by traders, while the downstream just needed less sourcing, and trading continued to be deadlocked.

　　Warehouse Receipt Inventory: Today’s Shanghai copper warehouse receipts totaled 104,397 tons, a daily decrease of 3,179 tons, a consecutive drop for 6 days; on June 22, LME copper inventory was 160,950 tons, a daily decrease of 100 tons.

　　Main positions: The top 20 long positions of Shanghai Copper’s main 2108 contract are 66413, -3843, short positions 67834, +2038, net positions -1421, +783, both long and short positions are reduced, and the headroom is reduced.

　　Market research and judgment: Fed Chairman Powell said at the hearing that he would not raise interest rates early because of fear of possible inflation, and would wait for the timing of inflation or other evidence of imbalances. The Fed’s dovish remarks caused the dollar index to pull back from a high level; the National Reserve Bureau announced The first batch of copper dumping reserves was 20,000 tons, which was slightly lower than expected. The worries had been eased before. Upstream domestic copper mine inventories continued to grow, and copper ore processing fees TC rose steadily, indicating that the tightness of copper mines has improved. However, due to the recent increase in refinery overhauls and the basically closed import window, copper production and imports have declined. However, the current downstream demand is not performing well, and most of them are on-demand purchases on dips, and the off-season of demand is approaching, and the upward action of copper prices is weak. Technically, the Shanghai copper 2108 contract daily KDJ low gold cross, long and short trading is cautious. It is recommended to operate in the range of 67800-69300 yuan/ton, with a stop loss of 500 yuan/ton each.