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thekiwi

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BYB: Always thought China was playing a very clever game, obviously annual growth has been halved, but 6% growth is something to be wondered at, in reality.

Id like to see any rise in commodities accompanied by a dropping USD, then it could be for real. Chart sems to agree with Barcap

 

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METALS-Copper hits 2-month high on China demand hopes

09 FEB 2009 13:21:38

 

* China buys copper from domestic bonded warehouses

* Weak economic data reported from Japan, Europe

* Copper, aluminium stocks on LME continue to rise

 

(Adds official prices)

By Julie Crust

LONDON, Feb 9 (Reuters) - Copper rose to a more than two-

month high on Monday on hopes that economic stimulus packages in

China, the world's biggest user of the metal, and the United

States will spur demand.

"There is a sense that perhaps the worst is over," Stephen

Briggs, commodity strategist at RBS Global Banking & Markets,

said.

"But with China it is very difficult to disentangle how much

of it is real demand and how much is going to be stockpiling."

But beyond China the global demand picture remained bleak,

traders said.

China has started buying copper from domestic bonded

warehouses and overseas markets as it moves to triple

its state reserves to about 1 million tonnes, according to trade

sources last week. [iD:nSHA29168]

Three-month copper on the London Metal Exchange rose

to $3,669 a tonne, the highest level since Dec. 1, from $3,540

at the close on Friday. It was trading at $3,561 in official

rings.

Copper prices jumped more than 12 percent last week.

Briggs said the rally was sustainable and while there may be

a correction at some point copper prices were not going to fall

back to $2,800 a tonne.

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Hi BVB Fan,

 

Not sure about H&S - that ought to be more pronounced IMO.

My first reaction was "Nice round bum!" :rolleyes:

Fibonacci studies over last year's range didn't show me anything obvious either (yet) - which comes as no surprise as the range of the recent 3-4 months is but a small fraction of the full-scale move.

Hovever, one study, based on the retracement late last October, suggests -

  • We may have seen The Low around Christmas last.
  • The current resistance "rhymes" with the 100% level of last October's support.
  • If the MACD Bullish Divergence prevails, a return to 4810 (October resistance) is well within reach.
Only time will tell.

post-20537-1234219176.gif

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  • 2 weeks later...

Just read the BME Copper Briefing Service report for Jan. I m T excess of refined production likely. i.e. lower short term prices.

"We remain of the view that prices will fall below US$3000 per tonne and stay there for some time". Chiese SRB are likely to support this lower price by adding to their strategic reserve.

 

An interesting report. Go to www.bloosburyminerals.com . It was sent to me in lieu of monthly free commentary by BME. Probably not available generally.

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"I may be clutching at straws here but it seems to me that copper, zinc and nickel have pretty well held their prices, with minor blips, since November."

 

 

 

Day Macduffy,

Not a TA'rs butt hair myself but yes I noticed over the weekend that Copper and zinc prices have been very stable for almost four months, the other thing I noticed was that copper and zinc storage have been tending towards stable amounts, LME on memory for the last two or more months, not sure if I actually saw a drawdown in both on Saturday morning.

Interesting, but as you say a bit early yet.

 

falko

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  • 1 month later...

Copper rises 40% and raises hopes of turnaround Clancy Yeates April 14, 2009

COPPER producers have been cushioned from the recession by a surge in the base metal's price of more than 40 per cent this year.

Copper's central role in such heavy industrial activity as power and construction has led some economists to view the surge as a sign of a commodities revival.

Although the price of about $US4400 a tonne is half what it fetched a year ago, recent rises have lifted the struggling stock prices of Australian producers.

Shares in the Queensland miner PanAust have risen 50 per cent since mid-March, closing at 30c last week, while the smaller West Australian Aditya Birla Minerals has more than doubled from 12c in mid-March to 27.5c, prompting a price query from the stock exchange on Thursday.

Aditya said it had no specific reasons for the surge but referred to the meteoric rise in the price on the London Metal Exchange, where copper has outperformed aluminium and zinc.

The bounce is thought to be a result of Chinese stockpiling. But some see it as cause for hope since it defies predictions of world growth contracting 1 per cent next year - the sharpest downturn since 1946.

A Westpac economist, Justin Smirk, said the rise in copper and a 20 per cent rise in oil prices since mid-February could be "early green shoots" in commodity markets but did not signal an imminent jump in prices.

With base metal inventory stocks on the London exchange at their highest levels since the early '90s, the rise in copper prices seemed premature, he said.

Mr Smirk said demand from China would not offset a 3.3 per cent decline in OECD economies this year. "China remains a support for prices, but there is not enough to drive them higher this year," he said.

More optimistic watchers say the increase could be sustainable. An analyst at Credit Suisse, Paul McTaggart, said it was well supported by a shortage in supply and cuts to capital expenditure from several copper miners.

Any rise is significant for Australia because commodities are the largest component of the economy's exports. Export revenue could fall by more than $30 billion this year because of a plunge in bulk commodity prices. V1

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Copper bull market

 

As an investor, and as a trader, there are a few commodities I look to in order to capture the essence of what I consider to be a still-alive commodities bull. Of course crude oil on the energy side, and then copper on the industrial metals side.

 

Copper's notoriety as the base metals' bellwether is apparent when you watch any business channel. Within a few minutes you are likely to see its price quoted on a headline ticker. As far as traders are concerned copper is the king of the base metals. As goes copper, so goes the balance of the base metals complex.

 

Copper's incredibly powerful bull market erupted from the foundation of spectacular fundamentals. A growing economic imbalance rooted from demand outpacing supply, mixed with a bit of speculative exuberance, saw copper forge a trough-to-peak gain of 574% to its recent July 2008 high.

 

Full Article.

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Kelt: This daily freebie is very worthwhile--IMHO.

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London, 16 April 2009 - Despite looking over stretched following Tuesday's spike higher, most of the metals climbed strongly yesterday highlighting the ongoing strength in the sector. Although we are happy to run with the rallies, we feel we are running on thin ice. Chinese buying and the ripples that causes, including short-covering and more general and widespread restocking, are seen as the driving force which has now got good momentum across the board, but the more exponential the rallies get, the further and faster they will likely pull back when the buying peters out.< /b>

 

If one looks at the overall stock situations and the supply/demand situations as dictated by various study groups, ICSG, ILZSG, INSG and WBMS, then surpluses abound. In addition, with economic data generally still sluggish, then at best we can justify these rallies as short-covering and restocking rallies, but not by a sustainable recovery in demand. Indeed with prices on average now up 47% from their recent 2008/09 lows and with lead up 82% and copper up 71%, see Table 1 you have to wonder how much further prices can go before producers and traders step in to hedge sell. Already we note that forwards are being borrowed which suggests a pickup in forward selling. As such we are extremely wary up at these levels, especially now that many of our targets have been hit and prices are approaching our upper targets that we thought would take considerably longer to reach.

 

However with global investor confidence seemly looking beyond the current ongoing financial troubles and thinking the worst is now behind us, sentiment has strengthened as seen by the rise in commodities and equities. We know all too well how quickly sentiment can change and taking a step back and looking at the big picture still tells us that this is very much a bear market rally.

 

The Dow closed up 1.4%, but this morning Asia's follow through has been relatively mild with the Nikkei up 0.1%, the Hang Seng down 0.15%, the MSCI Apex Asia index up 0.4% and China's CSI 300 index up 0.7%. Likewise oil is below $50 at $49.70, which suggests it is not overly optimistic.

 

In Shanghai the July contracts are mixed, copper and zinc are up strongly with copper up 3.6% at Rmb 40,440, although earlier it was limit up at R mb 40,980. Zinc is up 4.7% at Rmb 13,700, while aluminium is off 0.3% at Rmb12,790. In the spot Changjiang market in Shanghai copper's gains were only Rmb 200 to Rmb 43,600, aluminium was off Rmb 510, while nickel soared Rmb 14,250

 

On LME Select, the metals remain upbeat with copper up $23 at $4,865 on volume of 1,820 lots , nickel is up a further $300 at $12,700 on 405 lots, while aluminium is off slightly with 803 lots and zinc is up $25 at $1,541 on 880 lots. We will review all the metals and our targets in our technical analysis reports that follow on the website.

 

In the wider market the dollar is mixed, the euro is weak at 1.3195, the yen is stronger at 98.85, the euro-yen is weak at 130.45 and the dollar index is up marginally at 85.30. Gold likewise is treading water around $892 - all of which suggests indecision.

 

Overall we expect the base metals and markets in general to start getting more volatile, we are on the look out for corrections in the base metals and with a host of data out across Europe and the US trading is likely to be choppy, but active.

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