LLDPE downward momentum weakens due to the strengthened support

Domestic LLDPE market falls down slightly and then remains consolidation after the National Day holiday (Oct 1-Oct 7). Judging from the current situation, the Jan futures contract may face heavy pressure after its price reaches above 7,500yuan/mt, speculators take short position in the market and market price declines. But when the Jan futures contract drops below 7,300yuan/mt, the market would have strengthened support and the downward momentum weakens. Then speculative behaviors in the market may withdraw.

From the aspect of current position, most market players hold the view that the up space for LLDPE demand is limited and the supply side would have more bearish influence with more and more plants putting into production. Nevertheless, LLDPE market is also difficult to have significant downtrend in the short term, support from market low-end strengthened gradually. The main reasons are as follows: