PVC point of view: Last week's view was that the market was volatile and there was no trend; last week there was a sharp rise in the market, and the sharp rise released the risk of low valuation, the short-term was strong, and the mid-term focus was on short-selling opportunities.

Strategy: Focus on short selling near 6500; 09 breaks through the upper edge of last week's 5900-6100 shock range; the large range is 5500-6500 yuan, and the price above needs a strong driver (currently, the strong driver comes from limited delivery), and the fundamental data is volatile.

Logic: The spot valuation is not high, but the driving force is still weak, especially the social inventory pressure is high, and the market premium is high. Based on the basis, cost, and import and export valuations, there is not much room above the market;

The demand data in 2023 is better, and PVC demand is more resilient. We are cautious about the demand growth rate in 2024. The current demand is weaker than expected. After the balance sheet is revised, inventory pressure increases; for export, it also depends on the price. If the price increase is too large, foreign speculative demand will also weaken; in terms of supply, there is still room for improvement in both construction starts and output; the overall inventory pressure is still high, and there is no basis for high valuations; in addition, the price of caustic soda will generally strengthen in the second half of the year, which has a negative impact on PVC. There is also pressure on valuation; in the long term, PVC price fluctuations in 2024 will still be low, similar to the price fluctuations of 5500-6500 in 2023. The current PVC price is close to a high point, and the risk of low valuation is released; the price of caustic soda is in the 2300-3000 range; pay attention on the upper and lower edges of the range, PVC is mainly high and caustic soda is mainly low.（FIRST FUTURES）