Aluminum (LME) it remains capped by its 55-day moving average (DMA), currently at $2,355, and is setting new year-on-year lows. Credit Suisse Strategists lean towards greater weakness.
Aluminum remains in a clear downward trend
“We identify the next significant medium-term support at the 78.6% retracement of the 2020/2022 uptrend and the key psychological signal at $2,015/$2,000. Should this long-term support zone break as well, so we identify the next key supports at the $1,945 January 2021 low and then the October 2020 low at $1,725.”
“Breaking above the 55 DMA, currently at $2,355, would stabilize aluminum in the near term, but above the 200 DMA, currently seen at $2,830, is needed for deeper medium to long-term stabilization, which It’s not our base case.”
Source: Fx Street
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