- Copper initially tried to rally during the trading session on Tuesday but then started to fall yet again.
- This is a market that has been a little bit soft here recently, as we start to dance right on the top of the 50 Day EMA, which is starting to rise slightly.
- That being said, this is a market that is going to see a lot of noise in general, mainly due to the fact that copper is so sensitive to growth.
A lot of traders missed the fact that the copper market is a proxy for economic growth, because it is used for so many different things at the same time. Ultimately, this is a market that is sensitive to the idea of Chinese construction, as well as artificial intelligence expansion. Because of this, copper will become increasingly important, and therefore you need to keep an eye on what this market does to give you yet another idea as to how we may see various markets around the world trade. With that being the case, it’s important that you at least have an idea of what’s going on here.
From the technical analysis standpoint, sitting on top of the 50 Day EMA probably offers a reasonable amount of support anyway, but you should also keep in mind that the market has been consolidating longer term between the $4.50 level underneath and the $5.00 level above. As we are basically in the middle of that, copper seems to be “balanced” at this point in time, so I think this is a market that you won’t necessarily be putting big positions on, rather it you are going to be looking at it through the prism of risk appetite and taking that information to other trades that you may be putting on. Risk appetite is by far the biggest thing to watch right now, as there are so many different things causing chaos at the same time.
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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.
