No Change In Copper Price Trend Yet
IFC Markets | Nov 09, 2017 07:48AM ET
Lower import and exports in October signal slowing of China’s economy. Will copper price continue to decline?
Economic data on Tuesday showed China’s import and export growth slowed in October. Chinese imports rose 17.2% in October from a year earlier after 18.7% growth in September, and export growth was at 6.9% after 9% gain. This signals slowing of China’s growth. Authorities are concerned about accumulating debt in Chinese companies and China’s central bank governor recently warned about rising risks to China’s financial system. A focus on lowering companies’ financial leverage will result in lower financing for Chinese enterprises, further slowing growth. Slower growth is bearish for copper prices.
COPPER: D1 is correcting downward in daily timeframe after hitting the 51-month high in mid-October. The price is close to testing the 50-day moving average MA(50).
- The Parabolic indicator has formed a sell signal.
- The Donchian channel indicates no certain trend: no slope has developed yet.
- The MACD indicator gives a bearish signal.
- The stochastic oscillator has breached into the oversold zone, this is a bullish signal.
We believe the bearish momentum will continue after the price closes below the lower Donchian bound at 3.08. A price below that level can be used as an entry point for a pending order to sell. The stop loss can be placed above the last fractal high at 3.1851. After placing the order, the stop loss is to be moved every day to the next fractal high, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. The most risk-averse traders may switch to the 4-hour chart after the trade and place there a stop-loss moving it in the direction of the trade. If the price meets the stop loss level (3.1851) without reaching the order(3.08), we recommend cancelling the position: the market sustains internal changes which were not taken into account.
Technical Analysis Summary
Position - Sell
Sell stop - Below 3.08
Stop loss - Above 3.1851
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.