Copper, Crude Oil Lower as Slowdown Fears Intensify

Commodity prices are on the defensive as risk aversion grips financial markets after China’s manufacturing sector shrank for the third consecutive month while the preliminary set of April’s euro-zone PMI figures printed sharply below expectations, rekindling global growth fears. Cycle-sensitive crude oil and copper prices are following shares lower while gold and silver are facing de-facto selling pressure as the risk-averse mood drives haven demand for the US dollar. S&P 500 stock index futures are down over a full percentage point ahead of the opening bell on Wall Street – pointing to more of the same ahead – and an empty economic calendar seemingly assures no major pitfalls to derail momentum.

Comex E-Mini Copper (NY Close): $3.698 // +0.070 // +1.93%

Prices are testing through rising trend line support set from early October, a barrier reinforced by the 50% Fibonacci retracement at 3.606. A break downward exposes the 61.8% level at 3.516. Near-term resistance lines up at 3.696, the 38.2% Fib.

 

WTI Crude Oil (NY Close): $102.27 // -0.40 // -0.39%

Prices remain wedged between resistance at 104.90 and a rising trend line support set from mid-December, with a Bullish Engulfing candlestick pattern arguing for an upside bias. A break above 104.90 exposes falling trend line barriers at 105.21 and 106.42. Support is now at 101.58.

 

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