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Analysts at TD Securities point out that the first battle in the US-China trade sent nickel prices sharply lower, but a lull in news flow with regards to a new retaliatory rhetoric as tariffs bite US industry could have led some to speculate that ongoing negotiations could lead to a trade deal.

Key Quotes

“We view the White House’s announcement of an additional $200B round of tariffs as significant in escalating the tensions closer to a full-blown tit-for-tat trade war.”

“Given the extent to which nickel prices have incorporated expected EV demand, we expect nickel prices to come under further pressure.”

“We look to protect our gains from a potential short-covering rally, but continue to see risks to further downside to prices.”