Price action in the base metals complex has managed to fend off selling pressure from Commodity Trading Advisors (CTAs) on Copper, notes Ryan McKay, Senior Commodity Strategist at TDS.
Traders cover their recent short positions on Copper
“With China’s third plenum on the radar in the coming weeks, markets are keenly focused on the potential for further stimulus in the Middle Kingdom that could boost commodity demand. As such, major traders on the Shanghai Futures Exchange (SHFE) have covered their recent shorts overnight, and while the nearest CTA trigger remains to the downside, there is further margin of safety with the trigger at $9,597/t.”
“With our gauge of global commodity demand continuing to weaken, while depressed premiums and rising inventories in the Middle Kingdom argue against a fundamental shortage, there are plenty of potential catalysts that could still push prices lower once again.”
“With money managers’ positions still inflated on Comex, the lack of evidence to support current physical shortages, or disappointment in potential Chinese stimulus, may continue to see these money managers’ positions unravel.”
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.
