- Copper relieved as US dollar is pressured at key breakout area.
- DXY tests the 104 figure that could give way to a sell-off.
The price of copper recorded its steepest weekly loss in a year and is trying to recover from there at the start of this week. CFDs are bid by around 1.5% to $3.7850 at the time of writing.
The US dollar is giving in at the knees which is going to be helpful for the commodities bloc but as analysts at ANZ Bank explained, ''the market became increasingly concerned about slowing economic activity and its impact on demand.''
''Copper, which is seen as an economic bellwether, ended the week down more than 6% as central banks geared up to raise rates further. Uncertainty around Chinese demand amid ongoing lockdowns have also created headwinds,'' the analysts said. ''However, the red metal managed to pare some of these losses on Friday after better-than-expected US home sales.''
DXY breaking 104 the figure
The bears have been piling it on over the last two weeks and there is a risk of a move to 103 and lower which would help stabilise the rout in the metals markets as risk appetite returns:
Copper daily chart
The price imbalances above make for a compelling bullish thesis on the daily chart for the week ahead if the greenback sinks.
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