“There is a fair amount of volatility ahead of tomorrow,” an analyst said on Tuesday August 19. “Some large short positions are coming to expiry.”
The analyst noted that two shorts in the 10-20% category expire on Wednesday, as well as a dominant long position of 40%.
Aluminium spreads tightened throughout July before whipsawing up and down in August.
The cash-to-three-months spread widened to a contango of $18.35 per tonne on Tuesday August 12, from a low of less than $5 on August 8. It has since swung back to just $1.25 per tonne, threatening financing deals that rely on wide contangoes to finance...