❗ Copper prices started the week with significant declines.
Copper prices fell more than 2% at the beginning of the week, which may be associated with poor economic data from China. Industrial production for July rose by merely 6.4% YoY, the lowest growth since August 2020. Markets expected the print of 7.8% YoY (vs 8.3% in the previous month). Retail sales and fixed asset investment figures surprised to the downside as well.
The economic activity in China has slowed due to rising Delta cases, which prompted Chinese authorities to impose new local restrictions. It might turn out that the recovery could stall unless authorities and/or central bank take decisive action. Currently, the worsening situation is reflected by slowing credit expansion - it peaked in late-2020/early-2021. In theory, credit expansion in China could rebound along with further reserve requirement ratio (RRR) cuts - markets have been speculating that the People's Bank of China may be forced to take such measures. In such scenario, copper prices could potentially halt declines.
إبدأ بالإستثمار اليوم أو تدرّب على حساب تجريبي
إنشاء حساب حساب تجريبي تحميل تطبيق الجوال تحميل تطبيق الجوال
Copper prices plunged more than 2% and are currently near the support level marked by the 23.6% Fibonacci retracement. As a matter of fact, the upward trend line has been broken. Should the US dollar rebound after last week’s weakness, there is a chance that the first key support could be broken as well. On the other hand, bulls may feel encouraged if the price returns above the trend line. Source: xStation5
