Market Review: Weak Fluctuations Amid Policy Concerns
The futures market saw significant downward adjustments yesterday as contract rollovers occurred and policy expectations weakened. The Xinhua article stating that a GDP growth rate “around 5%” is acceptable triggered pessimism, leading to a broad sell-off. Steel prices dipped toward the lower bounds of their fluctuation range amid concerns over missed economic targets.

Market Analysis: Limited Downside Risk Before Key Meetings
Despite the downturn, the market’s basis performance suggests major price drops are unlikely before critical meetings conclude. Current policy ambiguity and soft fundamentals demand caution. Steel market activity remains constrained, yet not alarmingly volatile.

Trading Recommendations: Balance Risk and Opportunity

  • Avoid Aggressive Shorting: Market signals do not support extensive short positions; focus on strategic entry points.
  • Prepare for Declines: Set clear risk mitigation measures for potential downside scenarios.
  • Stay Informed: Monitor upcoming policy announcements closely, as they could alter market dynamics significantly.

Maintaining a flexible strategy amid this uncertain environment is essential for navigating potential opportunities and risks effectively.

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