Copper Price rallied 1.9 percent today as news kept coming that China was considering measures to support metals market. These include investigation into malicious short-selling on domestic exchanges, and possibly to buy up surplus metals. Copper stabilized above 2.0775 support level following a sharp recovery overnight.
The meltdown of Chinese stocks today with 5.4 percent drop in the Shanghai Composite did not manage to deter metal prices.
In contrast, WTI oil price fell 1.65 percent and repeatedly tested the 42.29 support. A blow to oil demand came this morning in Asia via a 4.6% drop in Chinese Industrial profits from last year. After which, losses in Shanghai stocks pressured oil price further throughout the day. Nevertheless, oil traded range-bound under the 43.46 resistance level and at a safe distance above record low at 39.97.
Gold price set for a sixth straight week of loss as Fed rate hike looms large on the horizon. It came perilously close to a 6-year low at 1064.55 as the US dollar firmed up after a few sessions of consolidation. Reuters reportedly quoted data from a bank that net outflow of precious metal funds reached a 4-month low by last week.
Gold Technical Analysis – Gold price lingers dangerously close to a 6-year low at 1064.55. Though already near the lower bound, there is still room for momentum signals to fall further and thus for prices to slide lower. The gold bears could keep their stops trailing 10-day moving average or the 20-day MA above it.
Daily chart – Created Using FXCM Marketscope
Copper Technical Analysis – Upward momentum propped up copper price today although it is still at a considerable distance below the 20-day moving average at 2.158 and a long-term resistance level at 2.2025. It is unclear whether copper could re-test resistance with the weekend around the corner. Upside bias will likely continue onto next week.
DailyChart – Created Using FXCM Marketscop
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