Hot Rolled Futures: Bear Market Rally Losing Steam and Approaching Resistance

The following article discussing the global ferrous derivatives markets was written by David Feldstein. As an independent steel market analyst, advisor and trader, we believe he provides insightful commentary and trading ideas to our readers. Note that Steel Market Update does not take any positions on HRC or scrap trading, and any recommendations made by David Feldstein are his opinions and not those of SMU. We recommend that anyone interested in trading steel futures enlist the help of a licensed broker or bank.

July manufacturing PMIs continued to be extremely depressed. Japan and China were slightly higher but remained below 50, indicating contraction. The Eurozone PMI continued lower to a very sickly 46.5. The ISM Manufacturing PMI fell 0.5 points to 51.2, remaining above 50 indicating growth, but at a drastically slower pace—the slowest since August 2016. The ISM new orders sub-index gained slightly to 50.8, but the backlog sub-index fell 4.3 points to a very dangerous 43.1.