We expect notable CTA buying activity in Copper markets this session to set the stage for a subsequent exhaustion of buying, notes Daniel Ghali, Senior Commodity Strategist at TDS.
Copper CTA buying activity will slow down
“CTA trend followers will now be exhausted without a substantial rally to push copper prices back towards the $9,800/t mark. The flow pattern is already asymmetrically tilted to the downside, but we estimate that only a large drop could trigger large-scale selling activity over the next week.”
“The setup in Aluminum markets remains more favorable if the complex continues to recover, with continued CTA buying activity expected on an upside. That said, the setup for algorithmic flows into Aluminum is now symmetrical.”
Source: Fx Street
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