Market Overview:
Yesterday’s news regarding a potential 25% tariff on Chinese goods starting February 1st had minimal impact on black commodity futures. Remarkably, rebar futures even edged up, signaling that the market may have already priced in this bearish news. This resilience strengthens our confidence in holding existing long positions.

General Outlook:
We anticipate the current rebound to persist until mid-to-late February, with an optimistic scenario extending it to mid-March, coinciding with the conclusion of the Two Sessions. The target price range remains around 3450–3500 yuan.

Key Observations:

  1. Tariff Impact:
    • Despite being the most significant short-term negative factor, the market’s muted reaction suggests limited downside risk.
  2. Rebound Dynamics:
    • A steep pre-holiday rally could lead to post-holiday volatility or an early downtrend.
    • Gradual and moderate gains may extend the rebound’s duration.
  3. Market Sentiment:
    • Expect a “zigzag” pattern with frequent fluctuations, requiring patience and disciplined position management.

Strategic Recommendations:

  • Hold Long Positions: Confidence in the market’s ability to withstand bearish news supports this strategy.
  • Prioritize Light Positions: Lightly invested traders are better positioned to endure market oscillations and seize opportunities.
  • Monitor Pre-Holiday Trends: Rapid gains may signal the need for adjustments in post-holiday strategy.

This phase is a test of patience and effective position management, with a cautious yet optimistic outlook for sustained upward momentum.

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