The Commodity Trading Advisors (CTAs) are being shaken out in base metals, forced to buy back some of their recently sold Aluminum, suggests Daniel Ghali, TDS Senior Commodity Strategist.
Demand expectations for raw materials continue to deteriorate
“Beneath the surface, commodity demand expectations continue to deteriorate at a rapid pace, placing additional focus on the Third Plenum to turn the tide. Failure to do so could result in a renewed downturn across the complex as physical demand trends continue to deteriorate with little offset provided by renewed concerns around supply risks.”
“Our future price simulations also suggest more notable downside convexity in Aluminum as a downtrend could catalyze large-scale selling activity by CTAs with algorithms forced to exit their long positions.”
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.
