MCX Copper market under short covering; Resistance seen at 343.5
Commodity Online | November 08 2016
UPDATED 10:22:50 IST

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Copper settled up by 1.99% at 341.15 in step with a firmer Shanghai futures contract as U.S. presidential candidate Hillary Clinton averted charges over use of emails. Copper prices are up about 6 percent this year, the metal has been left behind in a metals rally this year amid concerns that abundant supply will prolong a glut. Copper prices have been well-supported in recent sessions as traders bet that the global economy may be gaining momentum after a long period of sluggish growth. There are signs sentiment may be turning.

Antofagasta Plc’s top executive is less pessimistic after meeting customers and traders this week, and the prospect of supply disruptions in Chile means production will be lower than expected and supports a positive view on copper. Even as copper is in an oversupply in the short term, there is a consensus that over the medium term it is one of the most scarce commodities. Money managers are betting that copper’s days as a metals-market laggard may be coming to an end.

Hedge funds and other large speculators boosted their long positions by 20 percent to a record 67,806 U.S. copper futures and options contracts in the week ended Nov. 1, according to Commodity Futures Trading Commission data. Sentiment was mixed on whether the hours leading up to the U.S. election on Nov. 8 will spur or subdue trading activity. Technically market is under short covering as market has witnessed drop in open interest by -3.43% to settled at 19752 while prices up 6.65 rupee, now Copper is getting support at 337 and below same could see a test of 332.7 level, and resistance is now likely to be seen at 343.5, a move above could see prices testing 345.7.

Trading Ideas:
--Copper trading range for the day is 332.7-345.7.
--Copper prices gained in step with a firmer Shanghai futures contract as U.S. presidential candidate Hillary Clinton averted charges over use of emails.
--Prices have been well-supported as traders bet that the global economy may be gaining momentum after a long period of sluggish growth.
--Sentiment was mixed on whether the hours leading up to the U.S. election on Nov. 8 will spur or subdue trading activity.

Courtesy: Kedia Commodities