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Aluminum is ready to fall down even more?

Olymp Trade

Aluminum is in a local bearish trend again. The last consolidation ended with a correction to $1870, but bulls could not get higher. Current week began with a pulse continuation of the downward trend. Currently, quotes are at the daily support level of $1785. The chart hasn’t been lower since 2017, so the current zone can be viewed for short-term longs. However, if this level is breached, then the next area of interest for buyers will be only near $1700.

According to the IAI (International Aluminum Institute), in April aluminum production in the world decreased to 5 million 203 thousand tons (compared to 5 million 379 thousand tons in March). Chinese metal production in April was 2 million 940 thousand tons against 3 million 38 thousand tons in March.

The current bearish trend has added strength from the news about the full recovery of the Alunorte alumina refinery in Brazil. However, at some alumina enterprises in China (the Xinfa Group plant in Xiaoyi for instance) there was a reduction in production due to environmental reasons. This factor can help contain sellers a little bit.

Source: https://olymptrade.com/
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