The melamine market remains temporarily stable, with a phase-specific bottom largely established

1、 This week’s market situation

This week, the domestic melamine market as a whole showed a trend of “weak stabilization, narrow range oscillation”. According to the monitoring data from Shengyi Society, the market price has entered a sideways consolidation stage this week after experiencing a sustained decline in the early stage, and both long and short sides are in a weak equilibrium state.
2、 Price Trend Analysis
At the beginning of this week (May 25th), the price was 6150 yuan/ton, then slightly dropped to 6137.5 yuan/ton (May 27-28), and finally closed at 6125.00 yuan/ton (May 31st). The fluctuation within the week was minimal, with a maximum daily drop of only 0.20%. In the second half of the week (May 29-31), the price completely leveled off, with a daily increase or decrease of 0.00%. This indicates that market selling pressure has weakened, but buying remains cautious, with light trading leading to a lack of direction in prices.
As of May 31st, the price of melamine remained at a “low level” for a one-year period. The ‘full cycle low’ is a very clear bottom signal. This indicates that the current price of 6125 yuan/ton has reached the cost support line or historical valuation depression that has existed for a long period of time. The downward space has been extremely compressed, and the possibility of continuing a sharp decline is low, with a high margin of safety.
Comprehensive Conclusion and Future Outlook
Conclusion: This week, the melamine market showed a “bottoming out” trend. Although the moving average system is still in a bearish pattern (with the 10 day line below the 20 day line), suppressing the rebound height, the extreme stability of prices and the “low” label throughout the cycle confirm that the current is a temporary bottom area.
Outlook: It is expected that the market will continue to maintain temporary stability next week. Due to the lack of significant positive stimuli, there is a high probability of narrow fluctuations within the range of 6100-6150 yuan/ton. We need to closely monitor the appearance of the “moving average crossing” signal. Only when the 10 day moving average starts to turn upwards and approaches the 20 day moving average (i.e. the critical point where the moving average changes from negative to positive), is it a definite signal to establish a reversal upward trend.