- Copper is extending rout, on track to close in the red for the 4th straight week.
- Price has hit fresh 1-year lows at 2.781 before paring some losses to currently trade at 2.820 levels.
- Trade relations between the US and China, responsible for half the world's consumption of copper, could quickly turn nasty.
- President Trump's 25% tariffs on more than 800 Chinese goods worth $34 billion kick in midnight Friday.
- China has vowed to retaliate, said that that China's retaliatory tariffs on US goods will take effect immediately after US tariffs on Chinese imports kick in.
- Weighed down by ambiguity regarding the global trade situation and fears of weakening demand from China, copper parices have slipped over 11 pct on a year to date (YTD) basis on the LME and over 5 pct on the MCX.
- Technical studies are heavily bearish. Price has slipped below weekly cloud and 110W EMA.
- We see scope for test of major trendline support at 2.750. Violation there will see test of 200W SMA at 2.626.
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at -128.207 (Bearish) at 0600 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
