Research

Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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September 2019 | Base Metals


Copper: More room on the upside


Copper prices have rebounded strongly so far this month, driven by a bout of short-covering as macro sentiment turns more positive and fundamental indicators remain healthy. The recent break of key resistance levels could attract further momentum-based buying and we think there is plenty of room for prices on the upside as the market is still positioned in a too-bearish fashion after the weak price performance on macro fears in H1.

Short-covering under way
Copper has rebounded well since the start of September (+6%), boosted by both positive macro and fundamental forces. This comes in sharp contrast with August when the copper price sold off by nearly 5% amid broadly weak macro dynamics.

On the macro front, the red metal has enjoyed a slightly friendlier environment driven by a temporary de-escalation of US-China trade tensions (lifting the likelihood of an interim trade deal by year-end) and more policy easing across the globe, including in Europe (rate cut plus QE 2) and China (RRR cut plus fiscal stimulus). On the fundamental front,...

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