📅 2026-10-09 · SHFE Aluminum · Single-name brief Legacy coverage

This report is provided by MacroTerms.com

Data as of: 2026-10-08 · Settlement: Exchange settlement (15:00 Beijing close, vs prior settlement)

SHFE Aluminum Main Continuous (SHFE.AL) In-Depth Analysis Report | Bearish-Dominated Breakdown | 2026-10-09

The current strategy direction is bearish. The core rationale is that the price has effectively broken below the lower edge of the 20-day channel, and the night session continued the decline, with clear signs of active short-position increases pressing prices lower. Although inventories have slightly drawn down, it is insufficient to reverse the trend, and narrowing premiums in international and Chinese markets have also weakened import support. The short-term target is near pivot S1 23235; if it rebounds above R1 23650, the view needs to be reassessed.

I. Bottom Line & Directional Bias

This report's directional view on SHFE Aluminum main continuous contract (SHFE.AL) is bearish. The core logic rests on three points: first, the price structure has broken down, with the 10-08 settlement price of 23585 approaching the lower band of the 20-day channel at 23350, and the 10-09 night session probing further down to 23220, confirming a downtrend; second, fund flows indicate short-side dominance, with main-contract notional open interest of CNY 316.0m rising CNY 13.61m on the day, showing a typical open interest build on falling prices, indicating active short-side position increases to push prices lower; third, although warrant destocking is evident on the supply-demand side, LME inventories remain elevated, and the China premium is only +1.5%, with the import window not significantly open, failing to form effective support.

Direction invalidation condition: If the price can hold above the upper band of the 20-day channel at 24675 for two consecutive days, or if the night session rebounds above pivot R1 at 23650, the bearish logic is invalidated and the stance shifts to neutral/watchful waiting.

II. Price Action & Technicals

As of the 2026-10-08 settlement, the SHFE.AL main contract closed at 23385, with a settlement price of 23585, down 2.15% from the previous day. The 5-day cumulative decline is 3.39%, and the 20-day decline is 2.97%, showing a significant weakening of short-term momentum. The current price has broken below the lower band of the 20-day channel at 23350, sitting at only the 2.6% position within the channel, indicating a bearish technical pattern. In the night session, from 10-08 21:05 to 10-09 01:00, SHFE Aluminum opened at 23260, hit a high of 23365, a low of 23195, and closed at 23220, down 0.71% from the day session close and down 1.55% from the settlement price, further confirming the continuation of bearish momentum.

Regarding volatility indicators, ATR14 is 236.07, the intraday full range is 1.01%, and RV20 is 11.5%, showing that recent volatility has expanded somewhat. Pivot analysis shows Pivot P at 23500, resistance R1 at 23650, and support S1 at 23235. The current price of 23220 (night session) is approaching S1 at 23235; if this level is breached, downside space may open up. On the weekly chart, the last completed weekly candle (2026-09-28 to 2026-09-30) closed at 23830, down 1.53% for the week; the current week has not yet closed, tentatively reported at 23385, with the weekly timeframe still in a corrective posture. The overall technical picture shows a bearish alignment, with the short-term target at S1 23235; if effectively broken, look toward the area below the lower band of the 20-day channel.

III. Supply-Demand Balance & Fundamental Drivers

On the supply-demand fundamentals, inventory data shows divergence. LME aluminum inventory stands at 238,875 tonnes (as of 2026-10-07), with a daily change of 0 and a cumulative destocking of 5,650 tonnes over the last 20 periods, indicating that global inventory pressure has eased somewhat but to a limited extent. SHFE warrants total 118,396 tonnes (as of 2026-10-08), with a daily change of -3,467 tonnes, a decline of 2.84%, indicating an acceleration in China warrant destocking, providing some support to prices. However, this destocking has not significantly altered the overall supply-demand pattern, as absolute inventory levels remain at historically relatively high levels.

In terms of macro transmission, the US Dollar Index DXY is at 102.11, and the 10-year US Treasury yield is 5.23%, with the high-interest-rate environment suppressing commodity prices. The China premium is +1.5% (2026-10-08), narrowing from -1.62% five days prior, showing a shrinking spread between international and China markets; the import window is not significantly open, weakening the independent upward momentum of China prices. Additionally, focus in the next 7 days is on the CPI and PPI data on 10-14; if the data beats expectations, it may further impact macro sentiment, but current fundamentals are insufficient to support a price rebound.

Overall, supply-demand contradictions are not prominent, inventory destocking is limited, macro suppression is evident, and downward price pressure is significant.

IV. Positioning & Fund Flows

The positioning structure indicates short-side dominance. The top 20 seats hold a combined 434,066 lots, up 11,408 lots on the day; long positions total 450,594 lots, up 15,934 lots on the day; short positions total 450,594 lots, up 15,934 lots on the day; net shorts are 16,528 lots, down 4,526 lots on the day. Notably, although net short positions have decreased, main-contract notional open interest of CNY 316.0m rose CNY 13.61m on the day, showing an open interest build on falling prices, indicating active short-side position increases to suppress prices rather than short covering.

Regarding COT weekly changes and price divergence, prices fell while open interest increased, showing strong willingness from shorts to actively buy. In terms of implied vs. realized volatility, RV20 is 11.5% and ATR14 is 236.07, showing that market volatility has risen somewhat, but no extreme volatility has occurred, and fund flows remain dominated by the short side. The overall positioning structure shows bearish market sentiment, with short forces holding the upper hand.

V. Cross-Asset & Onshore-Offshore Value

In terms of cross-asset relative value, the gold-silver ratio is 69.95 (2026-10-08), with a 1Y percentile of 80.16% and a 3Y percentile of 26.72%, showing gold strengthening relative to silver. The copper-gold ratio is 1.58, with a 1Y percentile of 96.83% and a 3Y percentile of 56.61%, showing copper strengthening relative to gold, reflecting growth expectations. The oil-gold ratio is 0.022, with a 1Y percentile of 92.06% and a 3Y percentile of 47.88%, showing crude oil weakening relative to gold. The crack spread is 69.72 USD/barrel, indicating refining margins remain decent.

Regarding onshore-offshore relative value, SHFE.AL vs. LME.AL shows a China premium of +1.5% after tax adjustment (2026-10-08), narrowing from -1.62% five days prior, showing a shrinking spread between international and China markets; the import window is not significantly open. The narrowing China premium means the advantage of China prices relative to the international market is weakening, and import pressure may increase, further suppressing China prices. Overall cross-asset relative value shows the metals sector is generally weak, with aluminum prices under dual suppression from macro factors and supply-demand dynamics, facing significant downside risk.

VI. Supply Chain & Seasonal Inventory (Historical ...)

Based on historical statistics of the same date over the last 15 years covering the subsequent 20 trading days, SHFE Aluminum main continuous contract shows a seasonally weak characteristic during this period. Statistics show an average return of -1.68% and a median decline of -0.45% for this period. In the 15-year sample, only 6 years saw gains, while declining years dominated, with a win rate of less than 40%. Regarding historical extremes, the best year was 2016, with a gain of +6.04% during the same period; the worst year was 2021, with a decline of as much as -17.85%. The current market is in October 2026; from a seasonal statistics perspective, the probability of a decline during the same historical period is high, and the average return is negative, which resonates statistically with the bearish view of the current report. Although seasonality is not an absolute rule, combined with the current technical characteristics of the price breaking below the lower band of the 20-day channel and short-side open interest builds, seasonal factors further enhance the credibility of the downside expectation. Historical data indicates that in the absence of major supply-demand reversals or macro bullish drivers, aluminum prices often face seasonal selling pressure during this period, and investors should be wary of seasonal low risks.

VII. Scenario Analysis

Based on the current technical breakdown and fund flows, we construct three scenario projections:

Base case (probability 60%): Prices continue the bearish trend, testing lower support. The trigger condition is the price failing to effectively regain the upper band of the 20-day channel at 24675, and the night session rebound failing to hold above pivot R1 at 23650. In this scenario, prices will test lower to the S1 support at 23235; if effectively broken, the target looks toward the area below the lower band of the 20-day channel at 23350. Operationally, maintain a bearish bias, laying in short positions on rallies, and watch the validity of support near 23235.

Bullish case (probability 20%): Prices stage an oversold rebound, repairing the technical pattern. The trigger condition is the price holding above the upper band of the 20-day channel at 24675 for two consecutive days, or the night session effectively breaking above pivot R1 at 23650 and holding. If triggered, the bearish logic is invalidated, shifting to neutral/watchful waiting, with a short-term target near the middle band of the 20-day channel at 24012. Operationally, short positions must stop-loss and exit, waiting for confirmation of a new direction before repositioning.

Bearish acceleration case (probability 20%): Macro headwinds or inventory data beat expectations, accelerating the price decline. The trigger condition is the price breaking below S1 at 23235 while open interest continues to increase significantly, showing intensified active short-side suppression. In this scenario, the target looks toward the 23000 psychological level, or even lower. Operationally, add to short positions after the break of 23235, with stop-loss set above 23450.

The three scenarios sum to a probability of 100%, with the base case having the highest probability, consistent with the current bearish direction. Investors should dynamically adjust strategies based on whether prices touch key levels, strictly adhering to the invalidation conditions.

VIII. Trading Strategies & Risk Management

The strategy set out in this report is: short / entry 23,450 / stop-loss 23,722 / target 23,078 / horizon 1–2w / risk-reward 1:1.4. The strategy is strictly based on the current technical structure and risk budget. The stop-loss at 23,722 is placed below the upper edge of the 20-day channel at 24,675, designed to guard against the bearish thesis failing should prices effectively hold above that level. The stop distance of 272 equals 1.15×ATR (ATR14 236.07), ensuring it is not easily triggered within normal volatility. Risk per lot is CNY 1,420 (including commission and slippage), and the single-trade risk budget of CNY 6,697 corresponds to a reference cap of 4 lots. Position sizing should be dynamically adjusted to the account's overall risk budget, ensuring a single loss does not exceed 1% of total capital. Add/trim rules: if price breaks below 23,235 with rising open interest, add to short positions and move the stop-loss up to 23,500; if price rebounds to around 23,650 and stalls, consider trimming. The 1–2w horizon covers the current seasonal weakness window. During execution, monitor the 10-14 CPI and PPI releases closely; if the prints surprise, they may shift macro sentiment and the stop-loss should be adjusted in a timely manner.

IX. This Week's Data Calendar

Beijing time 10-14 09:30, the US releases CPI y/y and PPI y/y at 10-13 21:30; expectations and prior values are TBD, with high impact on the black, nonferrous, and chemicals sectors. The data may trigger market volatility and warrants close attention. No other calendar events for now.

This report is generated automatically from public quantitative and macro data for research and market tracking only. It does not constitute any investment advice.

Single-name briefs Deep dive

SHFE GoldSHFE.AU 2026-10-09

沪金(SHFE.AU)深度分析报告 | 偏多：黄金与白银比价处于低位 | 2026-10-09

SHFE Aluminum Main Continuous (SHFE.AL) In-Depth Analysis Report | Bearish-Dominated Breakdown | 2026-10-09

Today's Risk Map

Single-name briefs Deep dive

Previous briefs

⟠ This month's strategy backtest