{"id":60673,"date":"2012-10-04T14:11:41","date_gmt":"2012-10-04T04:11:41","guid":{"rendered":"http:\/\/www.fnarena.com\/index.php\/2012\/10\/04\/copper-proving-resilient\/"},"modified":"2012-10-04T14:11:41","modified_gmt":"2012-10-04T04:11:41","slug":"copper-proving-resilient","status":"publish","type":"post","link":"https:\/\/staging.fnarena.com\/index.php\/2012\/10\/04\/copper-proving-resilient\/","title":{"rendered":"Copper Proving Resilient"},"content":{"rendered":"
\n\tBy Jonathan Barratt<\/span><\/div>\n
\n\t <\/div>\n
\n\tOnce again we see ourselves long and waiting for another stimulus program. It seems counterintuitive as Chinese data in particularly the PMI for September was 49.8 when the market was looking for 50.1 and company profits dropped 6.2% from a year earlier falling for a fifth consecutive month.<\/p>\n

\n\t\tIn Japan, China’s largest trading partner delivered a weak Tankan<\/span> Index on sentiment within the largest manufacturing companies. The Index ending September quarter fell to -3 from -1 and was the fourth consecutive negative reading. The only glimmer of real support appears to be coming from the US housing market, which continues to show signs of recovery, however prices remain well supported. So we have to ask ourselves, why we are long?<\/p>\n

\n\t\tIt all seems to be about confidence and price action, more on price action in the technical section. Governments we feel have a mandate to wrestle any negative feeling out of the market before it happens. In Europe it feels as if Spain is not going to drop into the abyss, and it appears that the ECB<\/span>, EU and IMF muddling through the process is working. In the US for every bad economic number we get a good one and finally, confidence in China's ability to turn the tap on liquidity remains supportive.<\/p>\n

\n\t\tThe market is very sensitive to Chinese stimulus programs as it is clear that the central authority has the financial capacity to do it. At the moment the Chinese are on holidays celebrating Golden Week. We suspect that when they come back from the break we will see another program put in place. However, this time round we suspect that it will have more to do with stimulating demand for SMEs<\/span> [small and medium enterprises] which make up 70% of the economy rather than stimulating demand from government infrastructure projects.<\/p>\n

\n\t\t“We have an overall view that copper prices will recover from current levels”<\/em> was where we left our comment from last week, however we also decided to close down our longs which was a mistake as we had to scramble back on board at US374<\/span>. Governments have a mandate to wrestle any negative feeling out of the market before it happens. And this should help support the market.<\/strong><\/p>\n

\n\t\t Chart Point<\/u><\/strong><\/p>\n

\n\t\tWell we spent about 60 minutes trading below US370<\/span> and the resounding bounce suggested that this market is not weak. We are once again knocking at significant resistance US380<\/span> and then we have the old target of US400<\/span> to contend with. Momentum indicators which were looking shocking last week have since have turned, however not from a strong point. The range is US370<\/span> to US382<\/span>.
\n\t\t <\/p>\n

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\n\t <\/div>\n
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\n\t\tEdited by Jonathan Barratt<\/span>, Barratt's<\/span> Bulletin is a weekly subscription newsletter that provides expert analysis of commodity markets, global indices and foreign exchange movements. Click here <\/a>to take a no obligation 21-day trial to Barratt's<\/span> or to learn more visit www.barrattsbulletin.com<\/a>. Content included in this article is not by association necessarily the view of FNArena<\/span> (see our disclaimer).<\/em><\/div>\n<\/div>\n

\n\t\"\"<\/p>\n

\n\tThis report is not, and should not be construed as, an offer to buy or sell, or as a solicitation of an offer to buy or sell, products, securities or investments. This report does not, and should not be construed as acting to, sponsor, advocate, endorse or promote products or any other products, securities or investments. This report does not purport to make any recommendations or provide any investment or other advice with respect to the purchase, sale or other disposition of products, securities or investments, including, without limitation, any advice to the effect that any related transaction is appropriate for any investment objective or financial situation of a prospective investor. A decision to invest in securities or investments should not be made in reliance on any of the statements in this report. Before making any investment decision, prospective investors should seek advice from their financial advisers, take into account their individual financial needs and circumstances and carefully consider the risks associated with such investment decision.<\/i><\/p>\n

\n\tFind out why FNArena<\/span> subscribers like the service so much: "Your Feedback (Thank You)<\/a>" – Warning this story contains unashamedly positive feedback on the service provided.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Jonathan Barratt of Barratt’s Bulletin is long copper despite a weaker global economy, and explains why.<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[23],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/60673"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=60673"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/60673\/revisions"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=60673"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=60673"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=60673"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}