Copper Tumbles to 1-Month Lows!
Weaker-than-expected U.S. payrolls for July combined with higher exchange stocks to drive Copper futures to 1-month lows this morning. September Copper started the session in the red, as the London Metal Exchange (LME) reported exchange inventories rose by 2,225 metric tons to stand at 105,650 mt – the highest level since July 5th. In addition, Copper stock at the Shanghai Futures Exchange rose by 1,474 mt this week to stand at 91,563 metric tons. Further weakness was seen in the red metal after the U.S. Labor Department reported that Non-farm payrolls for July rose by a lower-than-expected 92,000 jobs and the unemployment rate rose to 4.6%. Speculative liquidation accelerated once the September contract fell below key support at 350.00. Sell-stops were triggered and prices fell to a low of 347.00, very near the 50-day moving average of 347.55, before light buying was found. Copper was not the only member of the base metals complex to sell off today, with Aluminum futures falling over 3% and Zinc dropping nearly 4% on the LME. The 100-day moving average at 343.00 is now the next support point for September Copper, with resistance at the 20-day moving average of $359.30. September Copper closed at 347.90, down 9.40.
Soybean futures ended the week on a high note, as weather forecasts calling for hot, dry weather in the key growing states of Illinois and Iowa have traders concerned about the condition of the crop. August is the most important month for bean development, with ample moisture key for yields. Traders largely shook off a crop estimate from private forecaster Informa calling for U.S. Soybean production of 2.700 billion bushels, up from the most recent USDA estimate of 2.625 billion bushels. A yield estimate of 42.7 bushels an acre is also 1.2 bushels higher than recent USDA estimates. The next USDA crop production and supply/demand report is due on Friday, August 10th at 7:30 AM Chicago time. The 20-day moving average of $8.75 ½ is seen as the next resistance point for November Soybeans, with support found at the recent lows of $8.33 ¼. November Soybeans closed at $8.60 ½, up 6 cents.
