🔹 Market Recap

After surging +3.42% last Friday, coking coal futures fell −2.65% yesterday, signaling a shift in sentiment. Technically, the drop came with increased volume and reduced open interest, a classic sign of a pullback into the previous consolidation zone.

Last week’s rally in the steel market was mainly driven by coking coal strength. With that driver now fading, upward momentum in steel prices has also stalled. Steel alone currently lacks the bullish force to sustain a major breakout.

🔸 Fundamental Update

  • Downstream demand continues to weaken, reflected by a softening basis
  • Upstream mills remain resilient due to relatively light order pressure, resulting in a market stalemate

This disconnect between upstream supply firmness and downstream demand weakness has led to a tug-of-war scenario, keeping price action range-bound.

🔹 Short-Term Outlook

We believe the market has temporarily returned to a sideways range between 2950 and 3010.
There is limited short-term trading opportunity, and it’s best to stay on the sidelines until prices approach key breakout levels.

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