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👉 Chaos in the metals market continues⠀
📉 A fresh attempt to trade nickel on the LME was unsuccessful, with electronic trading halting a few minutes after the price fell below the new daily limit. Major deals closed at $45,590 per ton, but some orders demanded a lower price, which means a drop of more than 5%; such deals can be cancelled again
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This is another blow to the reputation of the global industrial metals exchange. Recall: LME on March 8 (for the first time since 1985!) stopped trading after the price of futures NICKELc1:LME exceeded $100 thousand per ton. The exchange was forced to «freeze» open trades and cancel new orders: speculative price growth put pressure on producers who hedged with forwarding transactions.
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Two days later, the same crisis was observed on the stock exchanges of Shanghai, while current contracts lost more than 17%. Maximum loss (about $8 billion) was recorded by Tsingshan Holding Group, which had a large short position. The company is still trying to avoid a margin call.
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Among those who have capitalized on the anomalous volatility is Canada Nickel Co.: the exploration company is actively attracting investments and almost doubled its public offering to 45 mln CAD ($34.9 mln).
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Stock exchange hype is caused by fears of a critical deficit. Nickel prices have been rising for several weeks as the market is confident that supplies from Russia will be disrupted due to logistical, financial or political issues.
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Crisis in the nickel market is gradually shifting to other industrial metals. Now there are practically no sellers in the flow of exchange orders, and it is impossible to predict the price using technical methods. Large hedge funds are not ready to open new short positions and are trying to invest in metals through shares of companies in the metallurgy sector. But an ordinary trader should wait.
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Profits to y’all!