Pick-up in two-way activity suggests a base has formed

摘要

Lead prices have become quite choppy again as the market trades either side of$1,700/tonne. It may be that the market has found a base and there is a pick-upin two-way business. This would not be too surprising as the low in March was$1,676.50/tonne, the low in July was $1,684/tonne and even though prices fellthrough that level in August, they have rebounded and are now trading aroundthose former lows. On the upside, there have been short-covering rallies, but theserun into selling ahead of $1,750/tonne, with the two recent highs being $1,739 and$1,744/tonne. Overall, it looks as though the steep correction from the May peak hasnow runs its course and the price trend has flattened out. The fact that reboundsare not attracting follow-through buying suggests consumers feel in no need tochase prices higher, especially as the investment element of the market is quiet ascommodities are out of favour.