I. Price Action & Technical Analysis (~600 words)
As of the close on 2025-06-04, the SHFE.RB main continuous contract settled at CNY 2,974.00/t, up 1.5710% from the previous trading session, marking the largest single-day gain in the past five sessions. Trading volume expanded significantly to 2,066,104 lots, an increase of roughly 33% versus 1,553,663 lots on June 3, while open interest edged down from 2,297,854 lots to 2,280,389 lots. The combination of rising volume and falling open interest typically points to a short-covering-driven rebound rather than trend-following long positioning.
Looking at the five-day sequence, the contract closed at 2,964.00 on May 28 (down 0.7700%), rebounded to 2,978.00 on May 29 (up 0.4723%), slipped to 2,961.00 on May 30 (down 0.3366%), probed lower to 2,928.00 on June 3 (down 1.1812%), and recovered strongly to 2,974.00 on June 4. Price has been locked in a narrow 2,912.00–2,978.00 range, with the June 4 close near the upper boundary of that band.
On moving averages, MA5 stands at 2,961.00 and MA20 at 3,037.20. The close of 2,974.00 sits about 13 points above MA5 but roughly 63 points below MA20. The short-term average has begun to flatten while the medium-term average remains downward-sloping, and the moving-average alignment has yet to repair into a bullish structure. The 20-day high (H20) is 3,136.00 and the 20-day low (L20) is 2,912.00; the current price sits in the lower third of that band, leaving the medium-term soft bias intact.
Pivot indicators show the daily pivot (P) at 2,962.33, first resistance (R1) at 2,999.67, and first support (S1) at 2,936.67. The close of 2,974.00 lies above P but below R1, a neutral-to-firm state that is pivot-bullish yet unbroken on resistance. If a subsequent session breaks above R1 (2,999.67) on volume, upside targets shift to MA20 (3,037.20) and, beyond that, H20 (3,136.00); a break below S1 (2,936.67) would damage the short-term rebound structure and could reopen a retest of L20 (2,912.00).
Specific readings for oscillators such as RSI, MACD and ATR are pending update, but inferred from price versus moving averages, RSI is likely in the 40–55 neutral-to-soft zone, MACD remains below the zero line with the histogram possibly converging, and ATR-implied volatility has risen somewhat after the June 4 volume surge. On the weekly chart, price has run below MA20 for several consecutive weeks, and the monthly chart shows no clear reversal signal. Overall, the technical picture is one of “short-term rebound, medium-term pressure,” with R1 (2,999.67) and S1 (2,936.67) as the key validation levels.
II. Fundamental Drivers (~700 words)
Rebar is the core variety in domestic construction steel, and its fundamentals are driven mainly by the macro rate environment, the US dollar and inflation expectations, the inventory cycle, and changes in real estate and infrastructure demand. As of 2025-06-04, the quantitative data available to this report is concentrated in futures prices and open interest; specific figures for macro rates, the US dollar index, inflation data, inventories and ETFs are all pending update. The following is therefore a framework-based analysis without numerical inference.
On macro rates, rebar prices are highly sensitive to domestic credit impulses and real estate financing conditions. If domestic rates stay low or fall further, funding pressure on the property side eases marginally, supporting demand expectations for rebar; if the rate floor shifts higher or credit extension disappoints, construction steel demand comes under pressure. The market is currently caught between expectations of policy easing and the reality of weak property investment, and this tug-of-war is reflected directly in the range-bound trading of the RB main contract.
On the dollar and inflation dimension, rebar is priced in RMB, so US dollar index moves transmit mainly through imported raw material costs such as iron ore. A weaker dollar raises iron ore import costs and lends cost support to rebar; a stronger dollar pressures raw materials and weakens that support. On inflation expectations, if the domestic PPI year-on-year decline narrows, the industrial goods price center is likely to rise, which is bullish for rebar; the reverse is bearish. Specific data on these points is pending update.
The inventory cycle is the most direct variable in rebar fundamentals. If social and mill inventories destock in tandem, it signals smooth end-demand absorption and prices tend to rise rather than fall; if inventories build, it signals loose supply-demand and prices are pressured. Current data is pending update, but the volume-up, price-up pattern on June 4 suggests the market may be trading some expectation of inventory drawdown or demand improvement, which requires confirmation from subsequent data.
On ETFs and funding, domestic commodity ETFs have limited direct allocation to rebar and influence it mainly through overall capital flows into the black series sector. Net inflows into the sector provide sentiment and liquidity support to RB; net outflows leave the rebound lacking momentum. On geopolitics, rebar is less internationalized than crude oil and precious metals, so geopolitical shocks transmit indirectly through shipping rates, iron ore trade flows and macro risk appetite. An escalation that lifts shipping rates would raise raw material costs and offer weak support to rebar; a de-escalation would leave the cost side neutral-to-bearish.
In sum, rebar fundamentals currently sit in a phase of “warmer macro expectations, real demand yet to be validated.” The June 4 rebound was driven more by screen sentiment and short covering, and the fundamental drivers of persistence still need confirmation from inventory, credit and property data. In the absence of data, it is not appropriate to over-extrapolate the fundamental direction.
III. Positioning Structure & Fund Flows (~400 words)
On open interest, SHFE.RB main continuous contract open interest declined steadily from 2,441,388 lots on May 28 to 2,280,389 lots on June 4, a cumulative drop of about 161k lots over five sessions, or roughly 6.6%. The persistent decline in open interest indicates that some capital is exiting and market participation is falling, which typically occurs in range-bound markets without a clear trend. Open interest on June 4 fell 17,465 lots from the prior day while prices surged 1.5710%, and the combination of rising volume and falling open interest further confirms the dominance of short covering.
COT-style positioning data (commercial, non-commercial and retail positions) is pending update, so crowding on either side of the market cannot be assessed. However, inferred from the decline in total open interest, both bulls and bears lack conviction, and the market is in a position-cutting, wait-and-see mode. If open interest recovers and prices rise in tandem, it would signal renewed long participation and stronger rebound sustainability; if open interest keeps falling while prices bounce, the rebound is likely to be limited in scope.
Options and volatility data are pending update. Inferred from the futures screen, June 4 volume expanded to 2,066,104 lots, the highest in five sessions, and implied volatility may have risen. If volatility continues to climb, the options side could attract more directional and volatility strategies, which in turn would affect futures positioning. Overall fund flows currently show a “short-term trading dominant, trend capital absent” profile, and subsequent changes in open interest should be monitored to judge whether capital is returning.
IV. Cross-Asset Relative Value Analysis (~400 words)
On cross-asset relative value, rebar's linkage with macro ratios such as the gold/silver ratio, oil/gold ratio and copper/gold ratio operates mainly through the switch between “industrial attributes” and “safe-haven attributes.” As a typical industrial commodity, rebar is highly correlated with copper, oil and other industrial goods, and shows episodic negative correlation with gold's safe-haven attribute.
Specific values and historical percentile data for the gold/silver, oil/gold and copper/gold ratios are pending update, so precise relative-value levels and percentile judgments cannot be given. Framework-wise, if the copper/gold ratio is at historical lows, it signals pessimism about industrial demand expectations, and rebar as a black-series industrial good may come under pressure in sympathy; if the copper/gold ratio recovers from lows, it signals improving industrial demand expectations and transmits positively to rebar. On the oil/gold ratio, if crude outperforms gold, inflation expectations heat up, which is bullish for rebar and other industrial goods; the reverse is bearish.
The rebar-to-iron-ore ratio (rebar-ore spread) is the most important relative-value relationship within the black series. If the ratio is low, mill margins are squeezed and production cuts may be triggered, supporting rebar prices; if the ratio is high, mill margins are healthy, output is released and rebar supply pressure rises. The current rebar-ore ratio is pending update, but the independent RB rebound on June 4 suggests finished steel may be outperforming raw materials, with the ratio possibly repairing.
The core conclusion on cross-asset relative value is that rebar's directional drivers come more from domestic demand and policy than from direct transmission of global macro ratios. In the absence of ratio data, it is recommended to track intra-black relative value (rebar-ore ratio, coil-rebar spread) as the primary indicators, with cross-asset ratios as a secondary reference.
V. Sentiment & Public Opinion Monitoring (~200 words)
On sentiment and public opinion, domestic steel-related headline data over the past 48 hours is N/A, so a market sentiment score and headline bias cannot be quantified. Inferred indirectly from screen behavior, the volume-backed 1.5710% gain on June 4 indicates some recovery in short-term sentiment, with short covering and long probing coexisting, though the decline in open interest casts doubt on the durability of the sentiment improvement.
If positive headlines on steel industry policy, property data or inventory changes emerge, the sentiment score could rise further and catalyze the rebound; if negative headlines on weakening demand or inventory builds appear, sentiment may turn soft again. In the absence of sentiment data, it is recommended to use screen volume-price and open interest changes as proxy variables for sentiment, and to avoid directional calls based on a single headline.
VI. Historical Statistical Patterns (~300 words)
In terms of historical statistical patterns, Rebar exhibits certain seasonal characteristics. Typically, the period from the end of Q2 to the beginning of Q3 marks the transition from the traditional peak season to the off-season for construction steel, with June often falling in the window of “tail end of the peak season, off-season not yet arrived,” where price direction depends on the pace of inventory destocking and policy expectations. Performance data for Rebar prices over the same period (early June) in the past 10 years is pending update; precise probabilities of gains/losses and mean values cannot be provided.
From a seasonal framework perspective, if June destocking proceeds smoothly, prices tend to stage a rebound; if inventories accumulate or demand weakens, prices come under pressure. The current June 4 rebound is directionally consistent with the seasonal window, but extrapolation from historical statistics warrants caution. It is recommended to conduct quantitative validation of seasonal patterns once data for the same period over the past 10 years becomes available. In the absence of data, this section is limited to a framework description, with no numerical inference.
VII. Long-Short Game Scenario Analysis (~400 words)
Bullish logic (no fewer than 4 points):
1. On June 4, the close at 2974.00 rose 1.5710% on higher volume, with volume and price rising together, indicating relatively strong short-term momentum;
2. The close held above MA5 (2961.00) and the pivot P (2962.33), improving the short-term structure;
3. Price rebounded from L20 (2912.00) without making a new low, with initial bottom support emerging;
4. Open interest declined alongside rising prices, suggesting short covering may not yet be complete, leaving room for a further push toward R1 (2999.67).
Bearish logic (no fewer than 4 points):
1. The close at 2974.00 remains about 63 points below MA20 (3037.20), with clear medium-term moving average pressure;
2. The 20-day high H20 (3136.00) is far from the current price, leaving the medium-term downtrend intact;
3. Open interest has fallen for 5 consecutive days, with trend funds absent, leaving the rebound lacking incremental capital support;
4. Fundamentals—inventory, demand, and credit data—are pending update, leaving insufficient fundamental validation for the rebound; if data disappoints, the rebound may fizzle.
Short- vs. medium-term balance of forces: Short term (1–5 days), bulls hold a slight edge, with price above MA5 and P; a break above R1 (2999.67) would strengthen the bulls. Medium term (1–4 weeks), bears still dominate, with MA20 (3037.20) sloping downward; price must effectively reclaim MA20 to reverse the medium-term pattern. The market is currently in a “short-term rebound, medium-term pressure” window, with direction hinging on breaks of R1 and S1.
VIII. Trading Strategies & Risk Management (~300 words)
Strategy 1 (short-term long): If price pulls back to S1 (2936.67) and stabilizes, a light long can be attempted, with entry in the 2936–2950 range, stop-loss set below 2912.00 (L20), targets at R1 (2999.67) and MA20 (3037.20), horizon of 1–5 trading days, position size not exceeding 15% of total capital, conviction 6.
Strategy 2 (short on rebound): If price rallies to R1 (2999.67) and stalls with shrinking volume, a light short can be attempted, with entry in the 2995–3010 range, stop-loss set above 3037.20 (MA20), targets at 2962.33 (P) and 2936.67 (S1), horizon of 1–5 trading days, position size not exceeding 15% of total capital, conviction 5.
On risk management, the market is currently in a range-bound pattern with declining open interest and limited trend opportunities; range strategies are recommended, with strict stop-losses and avoidance of chasing rallies or selling dips. If price effectively breaks above R1 (2999.67) and holds, short positions should be exited promptly; if price breaks below S1 (2936.67), long positions should be stopped out promptly. On position sizing, single-trade risk exposure is recommended to be kept within 2% of total capital.
IX. This Week's Data Calendar (~100 words)
Domestic economic calendar data for the next 7 days is pending update. The following potential event windows warrant attention: weekly domestic steel social inventory data, steel mill blast furnace utilization rates, monthly real estate sales and investment data, domestic credit and total social financing data, and capital flows in the black commodities complex. If released, these data will act as catalysts for Rebar's short-term direction. Specific dates and values are pending update; please refer to official releases.
This report is generated automatically from public quantitative and macro data for research and market tracking only. It does not constitute any investment advice.