There is panic in the steel market, will the sharp drop continue?

Today, the steel market has made up for the decline, and the decline has increased. In terms of varieties, thread, hot coil and other varieties generally fell by 30-70 yuan, and strips, profiles, cold-rolled coatings and other varieties also accelerated their decline. At the same time as the fourth round of raising and lowering of coke was launched, the price of scrap steel also increased its downward trend, with a drop of more than 100 yuan in some areas, and the cost of steel products continued to decline. On the whole, the market turnover is poor, the panic is aggravated, the price drop has increased the buyer’s wait-and-see attitude, and the number of speculative inventory replenishment is not large.
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Judging from the price changes in the past two days, the atmosphere of market panic has obviously increased. A new low price in the market continues to impact people’s psychological defense line. Under the suppression of short positions in the futures market and the behavior of selling short orders at low prices in the futures market, worries about the market are getting heavier day by day.
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Right now, the market is pinning their hopes on steel mills to reduce production, but the output data released has not changed much. Even if steel mills speed up production reduction, the impact of production decline will take time. Under the effect of panic market, any negative impact may be magnified, which will suppress market confidence, increase selling behavior, and it is not conducive to market stabilization, and even falling prices will not help transactions and affect the release of demand. When the price rises, it is always out of stock. After the price falls, there is a lot of goods in the warehouse of the factory, and even the goods in winter storage have not been sold out. From this point of view, the ups and downs of the market, good or bad, and the manifestation of market resources are also different. At present, the market urgently needs the stability of sentiment and confidence.
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From the perspective of demand, the steel trade still has a situation of poor repayment from construction sites, and the lack of funds in place affects the start of construction at the construction site. The demand for cement has declined in stages, and the transaction in the steel market has been poor. At present, the spot market has made up a lot of losses over the weekend, the basis has narrowed, and steel mills have generally increased their losses. Merchants are afraid to place orders. Due to the rapid decline in the market, you need to be cautious in chasing short positions. The sharp drop in the market will not last long, but you need to wait patiently for bottom hunting.