Market Trend Overview
The trend of the propylene market this week is stable. As of April 2nd, the benchmark price of propylene in Shengyi Society is 8784.33 yuan/ton, which is the same as the beginning of this month.
Open the commodity market analysis system of Shengyi Society’s spot trading platform, and you will find that the yellow price line is winding around the 10 day moving average of the red line and the 20 day moving average of the blue line, presenting a typical “high-level oscillation” pattern.
The current “one-year position” indicator shows a medium to high level. This indicates that although the current price has not broken through the previous high, it is still in a relatively strong area at a higher price point.
Behind this’ high-level consolidation ‘is actually the extreme tug of war between supply and demand:
Supply side: The operation of refinery facilities is relatively stable, although there are some expected maintenance, the overall supply has not experienced a cliff like decline, and the supply is relatively sufficient, suppressing the impulse for further price increases.
On the demand side, downstream derivatives such as polypropylene (PP) have shown average performance, and there is a strong demand for the purchase of raw material propylene, without a large-scale hoarding trend.
Simply put, it means that the upstream has a strong willingness to raise prices, while the downstream has a weak willingness to receive goods, resulting in a stalemate between the two parties.
Business Society System Prediction: Beware of Changes after “1-Year Overrise”
Based on the core data of the Business Society’s commodity market analysis system, it is necessary to pay attention to two key signals:
1. Warning signal on: The bottom of the system clearly indicates “1-year super rise”. This means that the current price is already in the high-risk zone of the past year. According to the mean regression theory, it is difficult for prices to maintain a long-term super high range, and downward pressure is accumulating.
2. Location score characteristics: Currently, the 10 day, 20 day, and 30 day location scores are all at a “medium high level”. According to the system logic, when the short-term and medium – to long-term moving averages show a “tangled” state and the position is high, it often indicates an increase in trend uncertainty.
Overall, the supply-demand game in the propylene market is expected to continue in the short term, with prices likely to remain in a high volatility pattern, fluctuating between 8500-9200 yuan/ton. In the medium term, with the gradual release of supply side increment, if there is no significant improvement on the demand side, the upward momentum of the market will gradually weaken, and we need to be vigilant about the risk of price correction. Focus on international oil price trends, changes in downstream plant operating rates, and overall market transactions in the future.
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