Kopper v panikiii - Copper Panic! :-))) By Joseph Cafariello | Monday, March 17th, 2014 The sky is falling again. Doomsayers are once again predicting major financial upheaval just as they did in 2013 with the fall of gold — only this time, it’s over the fall of copper. Ever since hitting an all-time high of over $4.62 a pound back in early 2011, copper has been on a steady decline along with a host of other commodities. During this three-year tumble, the copper price twice stopped at $3.00 right to the penny, and both times rebounded upward. But on March 11th, the unthinkable happened: copper fell through its multi-year major support line of $3. In just one week, from March 7th to the 14th, copper had fallen from $3.22 to $2.90, losing as much as $0.32, or 9.94%, to levels not seen since July of 2010. The breach of copper’s long-term support raised concerns that global recovery is in peril, triggering massive sell-offs across all the major equity markets around the globe all week long — with Japan’s Nikkei index falling 6.4%, China’s Shanghai index falling 3.2%, Germany’s DAX falling 4.8%, the U.K.’s FTSE falling 3.5%, and America’s S&P 500 falling 2.1%. The flight to bonds confirmed these sell-offs as a bona fide panic. The U.S. 10-year note’s yield slipped down by some 18 basis points from 2.82% to as low as 2.64%, close to a major support line in place for four months. Even the long-hated precious metals got a lift, with gold rising some $37 or 2.8%. What’s significant about the gold move is that while copper was breeching downside support, gold breeched upside resistance of $1,350, climbing to $1,375 — a level not seen since last September. But why all this fear and panic out of equities and into the safe-havens of bonds and precious metals? Is copper really so important that its fall should strike such terror in financial markets? Well, it’s not really about copper, as the metal’s sell-off was itself a reaction to a different problem that runs deep within the financial system of the economic powerhouse that is — or perhaps was — China.
Posted on: Mon, 17 Mar 2014 19:10:15 +0000
Trending Topics
Recently Viewed Topics
© 2015