As Trade Conflict Escalates, Copper Price Gets Hammered
June 26, 2018 9:41 amVideo
Latest News
- Analysis of the GBP/USD pair on April 18, 2024 April 18, 2024
- Analysis for EUR/USD pair on April 18th. Dull ending to a dull week April 18, 2024
- USD/JPY: Simple trading tips for novice traders on April 18th (US session) April 18, 2024
- GBP/USD: Simple trading tips for novice traders on April 18th (US session) April 18, 2024
- EUR/USD: Simple trading tips for novice traders on April 18th (US session) April 18, 2024
- GBP/USD: trading plan for the US session on April 18th (analysis of morning deals) April 18, 2024
- Trading Signals for EUR/USD for April 18-20, 2024: buy above 1.0641 (21 SMA – 2/8 Murray) April 18, 2024
- Bitcoin slides ahead of halving event – Crypto News April 18, 2024
- Trading Signals for BITCOIN (BTC/USD) for April 18-20, 2024: buy above $62,500 or $63,037 (4/8 Murray – rebound) April 18, 2024
- GBP/USD. April 18th. Andrew Bailey did not clarify the situation on QE April 18, 2024
- Trading Signals for GOLD (XAU/USD) for April 18-20, 2024: buy above $2,375 (6/8 Murray – 21 SMA) April 18, 2024
- Technical Analysis – Netflix stock moves within narrow range ahead of earnings April 18, 2024
- Technical Analysis – GBPUSD tries to recoup some losses April 18, 2024
- USD/JPY in crisis April 18, 2024
- EUR/USD: trading plan for US session on April 18. EUR gets stuck at 1.0686 April 18, 2024
- Fed to keep policy tight for longer than markets view April 18, 2024
- Technical Analysis – BTCUSD drops to 6-week low as halving looms April 18, 2024
- Midweek Technical Look – EURUSD, US 500, WTI April 18, 2024
- Technical Analysis – AUDJPY pulls back but stays in uptrend April 18, 2024
- Forex forecast 04/18/2024: EUR/USD, USD/JPY, Oil and Bitcoin from Sebastian Seliga April 18, 2024
Copper was one of the best performing commodities in 2017. The performance was highly correlated to the overall performance of the world economy and the perceived demand as the world shifted from combustion engine to electric vehicles. This year however, the commodity has become beleaguered. Year-to-date, the price has fallen by about 8%. The declines so far are attributed to the ongoing global tensions on trade.
Copper’s top qualities of malleability, ductility and heat conduction makes it ideal for most electrical work. For this reason, it is used in large utilities like power distributor. It is also used at a micro level especially in the vehicle industry. Vehicles use copper for most of their wired processes like lighting. Therefore, as the world economy improves, so does the demand for the metal and the items that it powers.
While this year started in a way bullish to the metal, things changed when the rhetoric on trade started. A trade war would mean less global demand for some products. For example, if there is a trade war between the US and the EU, a company like Tesla could see its demand falling in the region. This would mean less demand for copper.
Early this month, the price of copper rose to above $3.3 per ounce. As the trade war rhetoric increased, the price retraced and fell to $2.977. Today, it is trading at $2.98.
The question now is whether copper will continue moving lower or will it recover. The answer will depend on the trade issues and technical. On trade, if the ongoing trade conflict continues, it could mean less demand for ‘paper’ copper. On technical, the current price is lower than the short and medium-term moving averages. The buying pressure of the metal has fallen. This means that the price could continue moving lower. For contrarians however, this could mean a buying opportunity in hopes that the trade rhetoric will subside.
The post As Trade Conflict Escalates, Copper Price Gets Hammered appeared first on Forex.Info.
Related Posts: