Utilizing a trailing average Hot Rolled Coil (HRC) price, the SMU/Steel Reality price momentum index for flat rolled steel in the US remained below 0% this past week and Momentum (MoMo) has been negative for the 14th straight week.
Momentum is based upon the current HRC price weighed against the previous 12 week average spot price as recorded by Steel Market Update (SMU). Posting a -3.88%, price momentum fell 0.15% over last week's recording of -3.74%. The graph below demonstrates the relationship between Hot Rolled Coil (HRC) and the momentum in pricing.
The Steel Market Update (SMU) Price Momentum Indicator - currently at lower - acts as a leading indicator as it factors in ongoing negotiations, imports and import pricing, domestic mill lead times and other factors in order to forecast the direction we see prices moving within a 30 to 60 day window. The SMU/Steel Reality Momentum Meter - still pointing negative - serves as a lagging indicator demonstrating the historical price momentum trend.
*Disclaimer: The information in the Market Commentaries was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed therein constitutes a solicitation of the purchase or sale of any futures or options contracts.