Hugo
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Hugo in HTO Trading,

Copper: Still holding above the 10-day moving average

Market sentiment was hit by China disappointing consumer price index (CPI) dropping 0.8% in January on a year-over-year basis, while the producer price index (PPI) plunged -4.3%. The data indicated decreasing inflation and less appetite for commodities. Base metals prices are expected to rise this week, in part due to traders looking to cover shorts before the Chinese New Year holiday on the 19th of February.

On yesterday session copper fell for the 3rd straight day but found enough buying pressure at the 10-day moving average and close near the low of the day. The commodity fell 9.75% since the start of year but the bottom seems to have confirmed for now. The stochastic is showing some bearish momentum after a sell signal where triggered last Friday.

Expecting upward move to a key level at 272.25 on a break above previous day high at 258.70 (scenario 1) or a break below previous day low at 252.55 could throw the commodity to year low at 242.30 (scenario 2).