Commodities | Apr 11 2013
At the moment the copper market is looking for direction and with the prospects looming of more stimulus to come we will probably see traders pitch the metal higher. The key will be as to whether or not we can see healthy draws in metal inventories from exchanges. If this is the case then the bearish picture would slowly turn. Higher prices we feel can only be sustained if it is accompanied with draws.
We expect more downside for the metal, however we do expect a low to be formed around US320 or US300. As it stands we are looking for a push towards the highs late Q2 or early Q3.
Chart Point – Copper:
Technically, we have broken the trend and will monitor price action. It does however look like a technical low is in place and with divergence appearing on the daily charts there is a real risk that it could trade higher. As mentioned last week momentum indicators are trying to tell us a bullish story and to expect weakness to be short lived. This could well be the case and it maybe the fact that our position will need to be turned for a loss.
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