Copper Suffers Heavy Losses
Today’s Spotlight Market
Copper futures suffered its heaviest two days of selling pressure in almost three years, as traders continue to worry about China.? Traders are also concerned over the ongoing situation in the Ukraine and the negative impact on world economy a military conflict would have.? Despite making statements to the contrary last week, Russia has dug in deeper into the Crimea region.? Ukrainian troops there have been surrendering to Russian forces and the Russian army has taken over military bases and hospitals. ?
February Chinese imports declined by the largest amount since 2009, stoking concerns over a Chinese economic slowdown.? The soft import data is just the most recent of a troubling pattern of economic data from China.? Manufacturing and construction activity has been slowing down; indicating demand for Copper may be softening.? On the surface, the People?s Bank of China has been keeping interest rates low.? However, companies in the construction and manufacturing sectors have been having a difficult time obtaining financing, suggesting the government will continue to facilitate a cool down of construction behind the scenes.? Shanghai inventory levels have climbed for the eighth straight week, the longest stretch in over two years.
Technical Notes? -? View Today’s Chart
Turning to the chart, we see the May Copper contract falling below the continuation chart support at the 3.1450 level.? Prices are now converging on the 3.000 level, which can be seen as significant support.? Prices have broken out of a wedge on the chart and have made the measure of the move.? The recent selloff has resulted in the RSI being in oversold territory, which suggests prices could find some support in the near-term.
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