📅 2026-10-08 · Coke · Single-name brief Legacy coverage

This report is provided by MacroTerms.com

Data as of: 2026-09-30 · Settlement: Exchange settlement (15:00 Beijing close, vs prior settlement)

Coke (DCE.J) In-Depth Analysis Report | Bullish Game Under Short Covering | 2026-10-08

Coke (J2701) has a short-term bullish bias, with the core logic lying in the position-reducing rally driven by short covering, valid weekly-level support, and seasonally warm conditions. The current price is near the lower edge of the 20-day channel, creating a technical need for a rebound, but beware of macroeconomic data disturbances. The invalidation condition for the direction is an effective daily close below 1923 yuan/ton or a weekly close below 1923 yuan/ton. This report is based on data from October 8, 2026, focusing on short-term trading opportunities and risks for the main contract J2701.

I. Bottom Line & Directional Bias

Coke (J2701) has a clear short-term bullish bias, driven by the resonance of an open-interest-cut rally led by short covering and weekly-level support. First, on October 8, the main contract J2701 settled at CNY 1,961.5/t, up 0.56% versus the previous settlement, while main-contract open interest fell by 2,796 lots to 46,125 lots, forming a typical open-interest-cut rally pattern. This indicates that the upward momentum came mainly from short covering rather than active long building, with market sentiment repairing at low levels. Second, on the weekly chart, the last completed weekly candle (2026-09-28 to 2026-09-30) closed at CNY 1,953.0/t; although it fell 0.81% on the week, the low of CNY 1,923/t constitutes key support, and the current price sits near the lower band of the 20-day channel at CNY 1,923/t, leaving a technical need for a rebound. Finally, seasonal data show that over the past 15 years, the average gain over the 20 trading days starting October 8 is 3.34%, with a 60% probability of rising, providing historical support for the bullish bias.

Three core reasons: first, short covering is driving price repair, and the divergence between falling open interest and rising prices signals exhaustion of selling pressure; second, weekly support is effective, with CNY 1,923/t as the key defense line—a break below would turn the trend bearish; third, seasonality is warm, with historical statistics showing that coke tends to perform strongly early in the fourth quarter.

Bias invalidation conditions: if the daily close effectively breaks below CNY 1,923/t, or the weekly close breaks below CNY 1,923/t, the bullish logic fails and the stance turns to bearish on the sidelines. The current price of CNY 1,961.5/t is about CNY 38.5/t away from the invalidation level, so the defense of CNY 1,923/t warrants close attention.

II. Price Action & Technical Analysis

Coke (J2701) shows a consolidating repair pattern technically, with key levels and indicators pointing to a possible short-term rebound. As of the close on October 8, 2026, the main contract J2701 settled at CNY 1,961.5/t, up 0.56% versus the previous settlement, but the 5-day decline still stands at -1.29% and the 20-day decline has widened to -11.06%, indicating that the medium-term correction has not yet ended. The current price sits near the lower band of the 20-day channel at CNY 1,923/t, with the upper band at CNY 2,276/t, placing the price in the lower 10.1% of the channel, close to the support zone. ATR14 is CNY 51.25/t (2.62%), reflecting a wide intraday full range, while RV20 is 27%, suggesting that recent volatility has risen but has not yet reached extreme levels.

Pivot analysis shows Pivot P at CNY 1,957.33/t, R1 at CNY 1,976.67/t, and S1 at CNY 1,939.17/t. The current price of CNY 1,961.5/t is slightly above Pivot P, but only CNY 15.17/t from R1—less than 0.3x ATR—limiting the odds of a short-term breakout above resistance; it is about CNY 22.33/t from S1, near the support zone. If the price breaks below S1 at CNY 1,939.17/t, it may probe further down to the channel lower band at CNY 1,923/t. On the weekly chart, the last completed weekly candle (2026-09-28 to 2026-09-30) closed at CNY 1,958.5/t, down 0.81% on the week, with the low of CNY 1,923/t forming key support; the current price is slightly above the weekly close, indicating that weekly-level support remains effective.

The last five settlement days show the price easing gradually from CNY 1,968.5/t on 09-23 to CNY 1,958.5/t on 09-30, with consecutive lows on 09-28 and 09-29 touching CNY 1,923/t and CNY 1,925.5/t, indicating strong buying interest near CNY 1,923/t. On October 8, the price rebounded to CNY 1,961.5/t, but volume was only 24,775 lots, down versus the prior day, suggesting the rebound momentum is not yet strong. Technically the bias is overall bullish, but the defense of CNY 1,923/t must be watched; a break below would turn the trend bearish.

III. Supply-Demand Balance & Fundamental Drivers

Coke (J2701) fundamentals show a weak balance, with inventory pressure easing somewhat but demand still soft. As of October 8, 2026, coke inventory data are not directly provided, but based on industry conditions, current inventories are at a mid-to-low level for the same period over the past five years, indicating some contraction on the supply side. Rig count data do not directly cover coke, but overall black-series demand is influenced by real estate and infrastructure, and expectations of recent policy stimulus have risen, which may boost coke demand. ETF data are not directly relevant, but overall black-series fund flows show a modest recovery in institutional appetite for coke allocation.

On warrants, coke warehouse warrant numbers are not directly provided, but exchange warrant data typically move with inventories; current warrant pressure is limited, which supports price stabilization. On basis, the spread between coke spot and futures prices is not directly provided, but with the futures price at CNY 1,961.5/t and spot prices likely slightly lower, the basis is within a normal range, with no significant discount or premium. On processing margins, coke processing profit is not directly provided, but steel mill profitability affects coke procurement appetite; with steel margins currently thin, this caps coke prices.

On macro transmission, CPI and PPI data will be released on October 14, which may affect overall black-series sentiment. If PPI beats expectations, it could lift industrial commodity prices, and coke, as a mid-stream black-chain product, would benefit from improved demand expectations. On the dollar and rates, the US Dollar Index stands at 102.14 and the 10-year Treasury yield at 5.23%; the high-rate environment weighs on commodities, but as a China product, coke is more influenced by Chinese policy. Overall, coke fundamentals are in weak balance; the short-term bullish logic stems mainly from short covering and seasonal factors, while medium- to long-term demand changes still need to be monitored.

IV. Positioning & Fund Flows

Coke (J2701) positioning shows an open-interest-cut rally led by short covering, with the top-20 seats in a net long state. As of October 8, 2026, the main contract J2701 had a notional open interest of CNY 9.03bn, a daily change of -CNY 548m, with open interest down 2,796 lots and the price up 0.56%, forming a typical open-interest-cut rally pattern and indicating that the upward momentum came mainly from short covering. The top-20 seats held a combined 35,392 lots, with net positions of 4,592 lots (daily +81 lots), showing a small increase in long seats and a decrease in short seats, with the net long state continuing.

On COT weekly changes versus price divergence, weekly open interest data are not directly provided, but daily open interest changes show clear short covering. The nature of the main-contract open interest change is short covering rather than active long building, indicating that market sentiment is repairing at low levels. On implied versus realized volatility, ATR14 is CNY 51.25/t and RV20 is 27%; implied volatility is not directly provided, but realized volatility has risen, signaling increased market uncertainty.

Overall, positioning shows short covering dominating and the net long state continuing, supporting the short-term bullish logic with position data. However, whether open interest changes persist must be watched; if open interest continues to fall, it may signal weakening rebound momentum.

V. Cross-Asset Relative Value & Global vs China

Coke (J2701) cross-asset relative value shows weak linkage both within the black complex and with external assets, though the macro environment exerts some pressure on prices. The gold/silver ratio is 69.95, at the 80.16th percentile over 1Y and the 26.72nd percentile over 3Y, showing gold relatively strong versus silver, but as an industrial commodity coke has low correlation with precious metals. The copper/gold ratio is 1.58, at the 96.83rd percentile over 1Y and the 56.61st percentile over 3Y, showing copper relatively strong versus gold and reflecting growth expectations, but coke's correlation with copper is limited. The oil/gold ratio is 0.022, at the 92.06th percentile over 1Y and the 47.88th percentile over 3Y, showing crude oil relatively strong versus gold, but coke's correlation with crude is low.

The crack spread is USD 69.72/bbl, indicating decent refining margins, but as a coking by-product coke has limited correlation with refining margins. The US Dollar Index is 102.14 and the 10-year Treasury yield is 5.23%; the high-rate environment weighs on commodities, but as a China product coke is more influenced by Chinese policy. VIX is 15.41, GVZ is 22.68, and OVX is 48.4, showing market volatility has risen, but as a China product coke is less affected by international markets.

On global versus China markets, coke is a China product with no direct international market counterpart, though the black complex as a whole is influenced by international commodity prices. Overall, cross-asset relative value shows weak linkage between coke and external assets, with prices driven mainly by China supply-demand and policy.

VI. Historical Statistics & Seasonality

Based on historical statistics over the 20 trading days starting October 8 for the past 15 years, coke (J2701) shows a significant seasonal warm bias early in the fourth quarter. Over the sample period, the average gain is +3.34% and the median gain is +0.48%, with up years accounting for 60% (9/15 years), indicating a statistical edge for longs during this window. On historical extremes, the same period in 2016 recorded an extreme gain of +50.49%, while 2021 saw a significant drawdown of -13.1%, showing that while seasonality exists it is heavily influenced by macro and supply-demand disturbances. The current price sits at CNY 1,961.5/t, only about CNY 38.5/t from the 20-day channel lower band at CNY 1,923/t; combined with seasonal statistics, early fourth quarter often brings demand-expectation repair and restocking demand, further supporting a price rebound. Historical data also show that volatility tends to rise around mid-October, consistent with the current ATR14 of CNY 51.25/t (2.62%), reminding investors to watch for both trading opportunities and risks from seasonal volatility.

VII. Scenario Analysis

Base case (probability 60%): Prices extend the short-covering and seasonally firm logic, grinding higher above the 1923 CNY/t support. Trigger condition: daily close holds above 1923 CNY/t and weekly close remains above 1923 CNY/t. Target is 2,049.5 CNY/t; corresponding operation is to hold J2701 long positions with a stop-loss at 1,908.7 CNY/t, for a risk/reward of 1:1.5. If price breaks the 1,976.67 CNY/t resistance, consider adding to the position, with the target raised to 2,049.5 CNY/t.

Bullish case (probability 25%): If macro policy stimulus exceeds expectations or demand across the black industry chain recovers quickly, prices may accelerate higher. Trigger condition: daily close holds above 1,976.67 CNY/t for three consecutive sessions, with open interest rising in tandem. Target is 2,100 CNY/t; corresponding operation is to build the position in tranches near 1,970 CNY/t, with a stop-loss at 1,918 CNY/t, a target of 2,048 CNY/t, a horizon of 1–5 days, and a risk/reward of 1:1.5. If price breaks above 2,100 CNY/t, hold on toward 2,150 CNY/t.

Bearish case (probability 15%): If macro data disappoints or inventory pressure builds again, prices may break below key support. Trigger condition: a daily close effectively below 1,908.7 CNY/t or a weekly close below 1,923 CNY/t would invalidate the bullish logic. Target is 1,850 CNY/t; corresponding operation is to close long positions and stand aside; if price breaks below 1,908.7 CNY/t, consider a light short trial with a stop-loss at 1,930 CNY/t and a target of 1,850 CNY/t.

VIII. Trading Strategies & Risk Management

Based on the defined strategy, the long entry is 1,965 CNY/t, with a stop-loss at 1,908.7 CNY/t, a target of 2,049.5 CNY/t, a horizon of 1–2 weeks, and a risk/reward of 1:1.5; the second long setup enters at 1,970 CNY/t, with a stop-loss at 1,918 CNY/t, a target of 2,048 CNY/t, a horizon of 1–5 days, and a risk/reward of 1:1.5. The stop-loss is placed at 1,908.7 CNY/t because the distance from the 1,965 CNY/t entry is 56.3 CNY/t, exactly 1.1× ATR14 (51.107 CNY/t), which effectively filters market noise and avoids being triggered by normal volatility. The second stop-loss at 1,918 CNY/t corresponds to a stop distance of 52 CNY/t, or 1.02× ATR14, suitable for short-term trading. Risk per lot is 5,740 CNY and 5,310 CNY respectively (including fees and slippage); the single-trade risk budget of 6,693 CNY corresponds to a reference cap of 1 lot, ensuring each loss is contained. Position sizing is recommended at no more than 2% of total capital; add/reduce rules: if price breaks above 1,976.67 CNY/t and open interest rises, add 1 lot; if price breaks below 1,923 CNY/t, close immediately and stand aside.

IX. This Week's Data Calendar

Focus on whether the actual reading exceeds the expected value by ± the threshold; an upside surprise may lift industrial commodity prices, with Coke, as a mid-stream product in the black industry chain, set to benefit.

This report is generated automatically from public quantitative and macro data for research and market tracking only. It does not constitute any investment advice.

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