Commodities | Nov 17 2011
By Jonathan Barratt
The copper market, as it represents the litmus test for the global economy, has been ebbing and flowing for some time on the back of news from Europe. As we have mentioned in the last series of Bulletins we feel that any outcome will provide a short lived burst of confidence, however it will do little in the way of providing a solid demand picture. As such we would be cautious about taking on any long positions.
Look towards any commentary coming about as a result of the annual American Copper Council meeting, currently underway in Miami, that starts this year’s round of negotiations on copper contracts by purchasing managers and suppliers in the US. Traditionally, these meetings help set the tone for consumption for the metal for the next twelve months and in the past has accounted for up to 60% of annual purchases. So far we are hearing that negotiations have taken an “about face” when compared to last year when the market was concerned about a short-fall. It appears that commentary to date on the “order roll” over this year’s consumption has just been “ok”.
Keep focused on the Copper RMB loans we talked about last week as this remains a concern for us should prices remain weak. Keep an eye on US300.
Chart point:
On the technical side we suggest that the market is in consolidating mode within a US370 to US330 range. Momentum remains mixed so no clear direction from here. The lower end support comes in at US315. We expect to see more consolidation with a negative bias.
Produced by Jonathan Barratt direct from the trading desks of Commodity Broking Services, Barratt's Bulletin provides expert analysis of commodity markets, global indices and foreign exchange movements. Click here to take a no obligation 21-day trial to Barratt's or to learn more visit www.barrattsbulletin.com. Content included in this article is not by association necessarily the view of FNArena (see our disclaimer).
.jpg)
This report is not, and should not be construed as, an offer to buy or sell, or as a solicitation of an offer to buy or sell, products, securities or investments. This report does not, and should not be construed as acting to, sponsor, advocate, endorse or promote products or any other products, securities or investments. This report does not purport to make any recommendations or provide any investment or other advice with respect to the purchase, sale or other disposition of products, securities or investments, including, without limitation, any advice to the effect that any related transaction is appropriate for any investment objective or financial situation of a prospective investor. A decision to invest in securities or investments should not be made in reliance on any of the statements in this report. Before making any investment decision, prospective investors should seek advice from their financial advisers, take into account their individual financial needs and circumstances and carefully consider the risks associated with such investment decision.
Click to view our Glossary of Financial Terms
