LME traded metals rallied of late, but looking at historical data I am inclined to think its a short term rally which will be quickly exhausted. Copper and nickel are the far more liquid markets. It would be imprudent to trade it until it forms a new support, whether at the current $3,000 level, or the stronger support at $2,000/tonne. After all, the other metals have fallen to historic levels, and the notion that copper fundamentals are better might just prove to shallow to hold markets.
I tend to think that all the other commodities have reached their lows, and so in the New Year rally, they will present good trading opportunities, particularly as I would expect them to be supported by a weaker USD. I will demonstrate as much on my forex blog.
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Andrew Sheldon
www.sheldonthinks.com
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