Copper Jumps on Better China Data
Copper Rebounding
Copper prices are pushing higher again on Tuesday as the market rebounds following heavy selling at the end of last week. An unexpected jump in US jobs data saw Fed rate hike pricing soaring ahead of year end, leading USD higher and risk assets, including copper, lower. The headline US NFP rose to 175k, more than double the 85k forecast and am increase on the prior month’s 112k, which was revised higher to 172k. With US jobs now much stronger than initially thought, pricing for a Fed hike by year end has jumped above 70%, leading USD higher. Copper fell on Friday as traders digested the data though the move is now starting to reverse as USD falls on developments in the Middle East. The prospect of a peace deal between the US and Iran is back in the spotlight after a recent series of attacks between the US and Iran and Israel and Iran threatened to dismantle the peace process. With USD now cooling on softer oil prices, risk markets are tuning higher again.
Stronger China Data
Along with developments in the Middle East, copper prices are also being lifted by better data out of China this week. Trade data came in firmly bullish for copper with Chinese exports seen jumping almost 20% last month, driven by soaring demand from the AI tech and renewable energy sectors. A recent supply bottleneck in copper looks set to keep prices underpinned into the summer with demand set to stay high and rising. As such, copper prices look vulnerable to a fresh breakout higher near-term particularly if we get news of a deal between the US and Iran, leading USD lower while sparking a fresh period of risk-on trading.
Technical Views
Copper
The sell off has stalled for now into the rising trend line from 2026 lows and the 6.2845 support level. While this region holds, focus is on a fresh test of the 6.5830-6.7190 resistance area with risks of a further breakout seen. If we do reverse lower near-tern, focus will turn to 6.1090 as the next support level and the longer-term pivot for copper direction over coming months.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% and 74% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.