Copper took a hard right to the jaw last week, thanks to another 64,025 metric tonnes (MT) of metal being mysteriously dumped into LME warehouses in just two days, apparently when no one was looking. We continue trying, without success, to comprehend how this logic defying feat is even possible. The second blow came with Friday’s job report, showing another 224,000 new positions were filled, prompting the dollar to soar, and metals to sour.
That said, although nonferrous metals were beginning to look a bit better a week ago, the last few days took a severe toll, with copper in particular facing another acid test. Spot copper is now a bit too close to testing support right at +/- $2.63, making us nervous. Further, a breach of this line targets $2.60, and if that fails to hold the critically important prior low at $2.55, is the next target.
There is no denying that things look tenuous at the moment, but other technical indicators, to include The Copper Journal’s weekly stochastics and momentum readings tell us there is reason to believe support will hold.
As they say, “The game ain’t over till it’s over,” and right now, it’s too early to throw in the towel.
John Gross is publisher of The Copper Journal and one of the metals' industry's best resources on copper pricing trends.
If you would like to learn more about how to manage your wire and cable inventory in this volatile market environment, email John at by clicking here or calling him at 631-824-6486.
