The fund's short position in commodities has reached a historical high. It has never been so much today (December 16th) that so much money has been injected into the commodity market. These funds are now optimistic that commodity prices will fall. Newer CFTC data It confirmed that non-commercial speculative funds have become a key factor affecting commodity prices in the past few weeks. While the net speculative position is now in equilibrium, the overall short position in the main commodity markets is at a high level ever seen (see chart). It is worth noting that the CFTC data is the market condition at the close of last Tuesday and therefore does not include the previous week. Fierce short selling in the precious metal market in the second half of the year. Funds hold particularly large short positions in the energy and agricultural markets. Several of these markets are in a good balance of supply and demand in the context of strong fundamentals, prices are still There is an upside risk. Therefore, we expect that commodity prices will rebound in early 2005. The short-covering of the fund is a potential source of significant price appreciation. After several increases in the initial inventory, Baltimore became a hot spot for early inventory increase. Today, there are 925 tons of copper delivered to the market. However, there have been market rumors that there will be a large number of implicit stocks in Singapore turning to open exchange warehouses. However, after a long period of time, it has still not happened. After the completion of the third Wednesday of the short-term delivery, it may be the more critical moment for this fact to happen. China still plays the role of a buyer in LME's recent transactions. It is rumored that the State Reserve has continued to buy copper in the LME recently. The LME market's popularity has therefore been boosted, but the current year is approaching, and domestic stock supply is temporarily abundant. The Shanghai market is used as a Leading up the scale seems unrealistic. With the completion of the delivery of the December contract, there is no concrete fact as to how many shipments the State Reserve has received. However, after December became a hot spot in the international market, whether the LME copper futures led the recent increase will trigger a near future Shanghai contract. A step-by-step increase is still worth our attention, but it is rumored that there are still some arbitrage buyouts in the Shanghai market. This may also provide some energy for the long-term compensatory growth of the Shanghai market. The western leading indicators suggest that next year, Western metal demand will not only exceed its peak, and the growth rate of demand should further decline. Therefore, the hot spot of mid-term demand is still in the Chinese market. China’s copper imports in November are estimated to exceed at least 100,000 tons. Subsequent imports may maintain a more moderate level as China's demand peaks have passed and will remain above 80,000 tons per month. With global supply still not significantly exceeding demand, whether China's demand can avoid the appearance of panic depends on whether the price difference between Shanghai and LME can maintain stable imports. I always believe that today's global copper supply and demand situation has eased, and the main reason for the emergence of the copper shortage in China still lies in the unreasonable price structure. After the Chinese market became a hot spot for international speculators, the conscious control of China’s copper demand created a potential source of artificial tension. In fact, the objective existence of implicit additions has remained relatively stable due to the hot sales in the Chinese market. The rhythm of the rhythm, this rhythm, effectively restrains the Chinese market from causing serious oversupply, and the relative emptiness of the state-owned stocks has significantly disrupted the rhythm of supply and demand in the domestic market. When this situation no longer occurs, China is actually sufficient. To obtain a stable consumption environment, the international copper price is at least a reasonable demand psychological position at 2850. The recent rise in LME spot premium reflects both the willingness of short-covering in the case of extremely low levels of registered warehouse receipts and the short positions of these cover-ups are related to China’s counter-empty positions, which are obviously unlikely to deliver physical goods. Therefore, even if there is no obvious inventory backflow in the short-settling situation, even if there is a gradual relaxation in its sustainability, it is unrealistic to expect the premium to return to the summer level. In the case of a small amount of stocks may be delivered in the near future, it is impossible to cause psychological pressure on short-term demand buying, and the market generally believes that an increase of 4-5 million tons in stocks is not enough to make the demand of the beginning of the year Too much repression. The fall in copper prices seems to be psychologically prepared in the near-term, but the recent rate of price rise has made people feel too fast. In a copper market with a limited market capacity, the amount of funds invested by the fund is still relatively large, and the chances of a one-and-a-half-month fund speculation cycle seem to be very regular. However, in general, the current copper market should not be too heavy to hold, even if the investors with larger funds have to allocate the cost of building positions rationally. The author believes that the copper market in the coming months will still be dominated by range volatility. We do not think that the market has reached a turning point, nor do we think that there is much room for increase in copper prices from the current price point, but it is estimated that the price of copper will rise. The pattern of roofing will also continue for at least three months. Therefore, low suction and high tosses are still the subject of speculation. The expected trading range is mainly between 2850 and 3150. Market commentary After the aluminum price fell to 1782 in the previous week, three-month aluminum experienced a good rebound last week. The $1830 regained on Tuesday, contrary to the trend in other markets, but long positions in other markets could be irresistible for aluminum. The dollar rebounded against the euro from a low point in history, and the aluminum price returned to $1800 and below. LME A large number of registered warehouses in Singapore came from India, which was bought by an international trading company. The inventory was delivered to the warehouse due to delivery requirements. It is expected that there will be further shipments from China as the manufacturers try to Before the tax rebate for exports, it is unavoidable that the taxation of aluminum exports is unavoidable. The opposition of smelters cannot change the decision of the government. With other metal prices fluctuating in the coming weeks, the aluminum transaction will It will become more technical and relevant to the exchange rate. The closer to $1770/80 proves that there is good support, and a stable professional buyout appears in the closer retracement, although this may disappear in the event of a weaker euro. Technical analysis Aluminium prices were blocked for the second time before the high of 1885, causing the price to retreat again. At the same time, the recent weakness was considered as part of the broad retracement, unless the price fell further in the next few days. The market will stabilize. Nearer (October) lows should still be difficult to reach in the 1680 region, but if the price falls below the 175055 support level, the middle top will be confirmed, and the price will therefore be at risk of retreating to 1700 and 1675, and then strong. The demand will reappear. To directly recover the price rise in the past few weeks, aluminum prices must re-cross the resistance 1850/60. As discussed in the previous issue, the bull market trend is not as fast as other markets? It may mean that there will be a comparison Weak, but it also means that strong support should be found at close to the price, because the market is still very close to the existing bottom structure. The price is only in the near future to establish the main high point (from 1997 and 2000) The price is in the 1750/75 zone. This should be a corresponding trend for the long-term buying. In fact, the weekly line suggests that the buying interest is now extended to the 1675 zone. Only by breaking the support level far below It will undermine the potential bullish posture. Otherwise, 1885/90 should continue to be attacked, implying that it will eventually surpass the 2000 psychological level before the energy failure (mid-term). Technical Strategy: From the negative reaction from 1860 in recent days, it tends to exit. Wait for the price to fall back towards the 1700 direction to consider creating a new bullish position.