Aluminium Prices To Remain Subdued In 2009

Three-month aluminium has continued to edge lower, and has hit the short term target of US$1,350/tonne which we set in our forecast on December 9. The contract is currently trading at US$1,342/tonne, down by 59% since peaking in July 2008. From a technical perspective, the metal is close to testing multi-year trendline support at US$1,330/tonne, and a move below this level would be a negative signal. Indeed, a sustained close below this level on a weekly or monthly chart could presage further downside to the 1993 low of US$1,100/tonne.

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