Tracking the copper market bears – Andy Home

(Reuters) By Andy Home – It’s an old market truism that prices never move in straight lines. Just ask an oil trader, who may well be suffering from whiplash after the ferocious 18-percent rally over the last three days. Oil’s prior capitulation was one of the many bear factors behind copper’s own price implosion in the middle of last month. And oil’s subsequent bounce seems at the very least to have helped avert more downside in the copper market. London Metal Exchange (LME) benchmark three-month copper is currently trading around $5,675 per tonne having clawed its way back up from last week’s low of $5,339.50. Is there potential for a stronger oil-like correction in the copper market? Much depends on the size and nature of the collective short positions initiated by bears on the Shanghai and London markets last month. While there are signs of a partial bear retreat in Shanghai, the positioning landscape is a lot murkier on the London Metal Exchange (LME). Which is a shame because tracking the bears on the LME is not just an academic question. There remains a dominant long position holder, for whom bear hunting may be more than just a bit of … continue reading

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