🔹 Strategy Update

We are adjusting our market stance from the previous “post-consolidation breakdown” to a more balanced view:
➡️ Short-term rebound likely,
➡️ Medium-to-long-term downtrend remains.

This shift is based on the following key factors:

🔸 1. Geopolitical Support from Crude Oil

The ongoing Middle East conflict continues to push crude oil higher.
Higher oil prices tend to strengthen coking coal and coke, which in turn offer upside support to steel prices.
This reduces the probability of a sharp near-term decline in steel futures.

🔸 2. Stable Fundamentals & Strong Basis

At present, no major contradictions exist in the short-term supply-demand structure.
Additionally, steel futures basis remains in the stronger range seen over the past two years, further limiting downside room.

🔸 3. Warehouse Stock Indicators Turn BullishData from SHFE shows a sharp decline in registered warehouse receipts, signaling tight spot market availability.
This is a clear bullish signal for the steel market in the near term.

🔹 Conclusion & Trading Recommendation

Given the above, we expect a short-term rebound after consolidation.
Suggested strategy:
Reduce short positions to 10% or less, and wait for a rebound to re-enter short positions at higher levels.

📌 Daily insights provided by LangZo Steel. For reprints, please credit LangZo Steel.