According to many market experts, aluminum is destined to flex further. According to others, it is around $ 200 below its “break even point”, that is the price level at which producers begin to lose money ($ 2000 is the limit price).
Briefly, we will therefore analyze both the seasonality of the aluminum price, and therefore how it has behaved historically, and the technical sector, as it could behave in the coming months.
In November, the primary aluminum prices followed its trend perfectly historical (seasonality to 30 years), as reported in the following chart.
ALUMINIUM – 2019 November Seasonality
In the first December week the 3 month $ prices have flat. Possible continuation of this sideways trend throughout the week, paying attention that the last two weeks of the current month prices react historically.
ALUMINIUM – 2019 December Seasonality
Attention also at the beginning of the year 2020 with the first three months in strong ascent (always at seasonal level).
ALUMINIUM – 2020 January Seasonality
ALUMINIUM – 30 years Seasonality
On the technical front, the primary aluminum prices remain in a bearish channel from the recent highs of March 2019 with a clear positive divergence of the MACD indicator which suggests a slowdown.
So it will be essential to controll prices in the coming weeks, cause the break up of the first resistance in the $1800 area, it would give a new push up prices with first targets identified in the $1900 zone, a second fundamental level to keep under control.
ALUMINIUM – 3 month in $ Weekly