The industrial metals complex remains in the crosshairs of Commodity Trading Advisors (CTAs), notes Ryan McKay, senior commodity strategist at TDS.
Base metals remain in demand
“With the upcoming plenary in China gaining much market attention, base metals have remained strong as stimulus optimism takes hold. However, our global commodity demand gauge continues to weaken, while depressed premiums and rising inventories in the Middle Kingdom argue against a fundamental shortage in Copper.”
“With money manager positioning still inflated on the Comex and LME, the lack of evidence supporting ongoing physical shortages, or disappointment in potential Chinese stimulus, may continue to see these positions unravel. Indeed, speculators on the Shanghai Futures Exchange (SHFE) hold only modest positions across the base metals complex.”
“In this regard, as bullish momentum fails to manifest itself, CTAs have become sellers of the Red Metal. However, funds could stop their sales if prices rise again above $9,760/t, while a further drop towards $9,142/t would be necessary to trigger additional liquidations.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
