The center of gravity of Shanghai aluminum also continues to move upward, and it is not advisable to be overly optimistic

Last week, the overall trend of Shanghai aluminum was better than that of the external market, showing a volatile upward trend, generally fluctuating between 18050-19000, with a cumulative increase of 4.
67%.

At the beginning of the week, after standing at the 18,000 level, the low rebounded, and with the sharp rise in European electricity prices, the energy crisis restarted, Europe's largest aluminum smelter reduced production, supply disruption restarted, metals were boosted, and the dollar high fell, Shanghai aluminum also continued to move up, after standing at 18,500 positions, it also rebounded again, rising to around 19,000
.

Last week, the overall Lun aluminum fluctuated between $2230-2305, and the overall trend
was "V" pattern.
At the beginning of the week, the market continued to fall, the market bet that the Fed will still actively raise interest rates, and the dollar continued to rise, metal trend under pressure, Lun aluminum continued to fall, in a 7-to-day negative trend, during the period once fell to the low since early April 2021 of $2233, but with the bottom support, and European natural gas prices continue to rise, the energy crisis broke out again, aluminum plants also reduced production, supply concerns again to support aluminum prices, so Lun aluminum stopped falling, rebounded at a low level, and continued to rush higher after standing at $2,300, and the short-term rally is expected to continue , supported by low inventories, the center of gravity of London aluminum may move up from this week, or fluctuate between $2250-2400.

In terms of the market, the supply of aluminum ingots is abundant, and the enthusiasm of middlemen to enter the market is acceptable, coinciding with the Mid-Autumn Festival holiday, some downstream enterprises enter the market to receive goods, and the overall market transaction is better than last week
.

East China: Affected by the overseas energy crisis, the cost of aluminum companies has increased sharply, and production cuts continue, last week Europe's largest aluminum smelter Dunkirk Aluminium Company of France will reduce production by 22%, and will close some production capacity at the beginning of this week; As of last Friday, East China spot aluminum prices were between 18780-18820 yuan / ton, up 690 yuan / ton month-on-month, and the spot discount was about
60 yuan.

South China: As of last Friday, the price of Foshan Nanhai aluminum ingot with tickets was between 19010-19110 yuan / ton, up 740 yuan / ton from the previous month, the increase was wider than that in East China, and the current price difference between East China and South China aluminum ingots expanded to 260 yuan / ton; It is understood that the downstream demand in the South China market has not improved significantly, it is still weak, and downstream enterprises just need to receive goods
.

Macro sentiment remains bearish for now, with expectations of a 75 basis point rate hike by the Fed in September
.
From a fundamental point of view, the supply-side production reduction is expected to be strong, and the European region will continue to reduce production in the third quarter, while the domestic Yunnan region faces production reduction pressure
after entering the dry season.
At present, the consumption side has not shown obvious peak season characteristics, and pay attention to the implementation of the follow-up guarantee delivery policy
.
Short-term aluminum prices are strong, and the probability of operation is higher, but the market may retrade interest rate hikes and demand recession expectations
after the holiday.