Spot marketers' sentiments.

Prices rised up sharply within 2 days.

After US market closed at high price around $7.5 for 256Mb DDR last Friday, Asia market also traded at higher prices in spot market at beginning of this week. For last two days, spot prices already hiked up to $7.65 and $3.78 for 256Mb and 128Mb DDR components respectively.

Adventurers take opportunities although risks remain.

Last week module markers and channels are still cautions on tracing high prices as they still don't foresee the strong end-demand. However, as prices climb up day by day and profit opportunities have gone day by day. Some adventurous traders and channels can't resist the temptations anymore; they begin to take some position/inventory for prices gain. As more players getting into this market, spot prices begin to hike up soon. Although it is high risk game, it's also high return. What are signals to support them to take action?

DRAM makers still hold the prices tight.

After big three, Micron, Samsung and Hynix, released their earning and announced 4Q bit growth won't have big jump comparing with 3Q. Marketers sense either in technology or product migration to ramp up the output for DDR are actually taking longer than original expectation. The front- and back-end yield issues are inhibiting industry supply growth in DDR products, therefore DRAM makers can still hold tight on prices strategy and product allocation.

Inventory in channels was relative low.

Previous inventory level in channels and module makers were relative low and spot traders didn't even dare to take any position. Now as prices trade up and demands (either in real or refill inventory in this spot trading pipe) pick up, they do feel tight supply and will to take a little bit position. European and Asian demands are relative strong than US market.

Expect slow spiral down rather than rapid fall.

Even marketers don't see the strong end-demand, as long as suppliers tighten up the supply- price won't get too much trouble in the near-term. Some people expect that prices will hike up to touch peak ($8 for 256Mb DDR?) then begin to fall down a little bit (but it won't take the free fall.) It has the floor ($6.5~$7 supposed?) to support. Of course, we all talk about short-term in this "weekly" market info update.

Watch out module price v.s chip prices.

Also we like to point out the prices difference between modules and components (chips) will also influence the chip prices trend. Now spot market prices for original brand modules are trading around $62~$64, major on third are around $60~$62, OEM brand are around $58~$60. We should reverse module prices to chip prices, if it is higher than chip prices then chip prices still have room to rise; if it is not then it is harder to continue rising. We already notice some module prices have been rising up $2 above current level but couldn't succeed to sell in high prices; buyers are waiting to see what's going on.