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Copper Fundamental Forecast – May 5, 2016
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July copper prices weakened early Wednesday due to selling triggered by a stronger dollar and manufacturing surveys from around the world. July Comex High
July copper prices weakened early Wednesday due to selling triggered by a stronger dollar and manufacturing surveys from around the world. July Comex High Grade Copper futures were last recorded at $2.2000, down $0.0190 or -0.86%. Benchmark copper on the London Metal Exchange closed down 1.4 percent at $4,850.00 a tonne. A higher U.S. currency makes dollar-denominated commodities more expensive for non-U.S. firms.
Lackluster manufacturing data from around the world had sparked the selling on Tuesday, notably Chinese factory activity shrinking for the 14th straight month and British output at three-year lows.
Prices are expected to continue to slide over the near-term because of worries about Chinese demand and growing Asian supplies. Additionally, sellers are likely to dominate the market if the U.S. Dollar continues to strengthen amid weakness in crude oil and U.S. equity markets.
Although crude oil was trading higher, it wasn’t strong enough to turn copper prices to the upside, but it did likely provide some support, preventing an even steeper slide. Look for lower prices today because of the weakening fundamental outlook, however, we could see some late session short-covering and position-squaring as investors prepare for Friday’s U.S. Non-Farm Payrolls report.
FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.
Today’s economic releases:
| Cur. | Event | Actual | Forecast | Previous |
| USD | API Weekly Crude Oil Stock | 1.265M | 0.500M | -1.070M |
| USD | API Weekly Cushing Crude Oil Stock | 0.382M | 1.900M | |
| NZD | Employment Change (QoQ) (Q1) | 1.2% | 0.7% | 0.9% |
| NZD | Unemployment Rate (Q1) | 5.7% | 5.5% | 5.3% |
| USD | FOMC Member Lockhart Speaks | |||
| JPY | Japan – Greenery Day | |||
| EUR | German Services PMI (Apr) | 54.5 | 54.6 | 54.6 |
| EUR | Markit Composite PMI (Apr) | 53.0 | 53.0 | 53.0 |
| EUR | Services PMI (Apr) | 53.1 | 53.2 | 53.2 |
| GBP | Construction PMI (Apr) | 52.0 | 54.0 | 54.2 |
| EUR | Retail Sales (MoM) (Mar) | -0.5% | -0.1% | 0.3% |
| EUR | German Buba President Weidmann Speaks | |||
| USD | ADP Nonfarm Employment Change (Apr) | 156K | 196K | 200K |
| USD | Nonfarm Productivity (QoQ) (Q1) | -1.0% | -1.4% | -2.2% |
| USD | Trade Balance (Mar) | -40.4B | -41.50B | -47.10B |
| USD | Unit Labor Costs (QoQ) (Q1) | 4.1% | 3.3% | 3.3% |
| CAD | Trade Balance (Mar) | -3.4B | -1.40B | -1.91B |
| USD | Markit Composite PMI (Apr) | 51.7 | ||
| USD | Services PMI (Apr) | 52.1 | 52.1 | |
| USD | Factory Orders (MoM) (Mar) | 0.6% | -1.7% | |
| USD | ISM Non-Manufacturing Employment (Apr) | 50.3 | ||
| USD | ISM Non-Manufacturing PMI (Apr) | 54.7 | 54.5 | |
| USD | Crude Oil Inventories | 1.695M | 1.999M | |
| USD | Cushing Crude Oil Inventories | 1.746M | ||
| USD | FOMC Member Kashkari Speaks | |||
| AUD | HIA New Home Sales (MoM) (Mar) | -5.3% | ||
| AUD | Retail Sales (MoM) (Mar) | 0.3% | 0.0% | |
| AUD | Trade Balance (Mar) | -2.900B | -3.410B | |
| CNY | Caixin Services PMI (Apr) | 52.6 | 52.2 |
Upcoming Economic Events that you should be monitoring:
Thursday, May 5, 2016
| Cur. | Event | Actual | Forecast | Previous |
| JPY | Japan – Children’s Day | |||
| GBP | Halifax House Price Index (MoM) | 0.1% | 2.6% | |
| GBP | Halifax House Price Index (YoY) | 9.6% | 10.1% | |
| EUR | ECB Economic Bulletin | |||
| GBP | Services PMI (Apr) | 53.5 | 53.7 | |
| USD | Initial Jobless Claims | 260K | 257K | |
| CAD | Building Permits (MoM) (Mar) | -5.0% | 15.5% | |
| USD | FOMC Member Bullard Speaks | |||
| USD | FOMC Member Bullard Speaks | |||
| USD | FOMC Member Kaplan Speaks | |||
| USD | FOMC Member Lockhart Speaks | |||
| USD | FOMC Member Williams Speaks | |||
| AUD | RBA Monetary Policy Statement |
Government Bond Auctions
Date Time Country Auction
May 04 11:05 Norway Holds bond auction
May 04 11:30 Germany Eur 4bn Apr 2021 Bobl
May 04 11:30 UK Gbp 2.75bn 1.5% 2021 Gilt
May 04 11:50 France Holds bond auction
May 04 17:20 Sweden Details of bond auction on May 11
May 05 10:30 Spain Holds bond auction
May 05 11:00 Austria Holds bond auction
May 05 11:30 UK Gbp 2.5bn 1.5% 2026 Gilt
May 09 17:20 Italy Announces details of bond auction
May 09 N/A Ireland Details of bond auction on May 12
May 10 11:30 Germany Holds I/L bond auction
May 11 11:03 Sweden Holds bond auction
May 11 11:30 Germany Eur 5bn Jun 2018 Schatz
May 12 11:10 Italy Holds bond auction
May 12 17:20 Sweden Details of I/L auction on May 19
May 12 N/A Ireland Holds bond auction
About the Author
James Hyerczykauthor
James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.
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