Copper futures is not immune to the current commodity collapse we are all witnessing recently – predominantly with energy, food, and livestock. It is the lack of global growth that has reigned in the high prices of just about everything, copper futures is no exception (down yesterday as much as 1,450 points in New York’s Commodity Exchange).
Copper prices are down as much as 8.6% in London yesterday and down the daily limit in Shanghai, China. …speaking of which, demand weakness for the industrial metal and lower energy costs combined with worse than expected economic statistics are reportedly driving copper prices down there. Even Deutsche Bank AG claims copper demand will grow at its slowest pace since 2009.
Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, shared his fundamental analysis insight regarding the current copper futures situation by stating, “The overall fundamentals for copper are not good and haven’t changed overnight, however, this plummet may be over exaggerated which is why we see copper up 550 points today.” Plotkin adds, “Strength in gold may be adding to copper’s temporary rally.”
Copper futures are down with no bottom yet in sight. I will require copper futures to demonstrate some type of “relief rally” before looking to get short this market once again.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.