Copper, Crude Oil Lower on Chinese Exports Slump

Commodity prices are on the downswing as risk appetite evaporates amid economic slowdown fears after Chinese export growth slowed to the weakest in six months. Overseas sales added 1% in the year to July, falling short of economists’ expectations for an 8% increase. New Loans dropped to CNY540.1 billion over the same period, marking the lowest reading since September 2011 and underscoring the deepening downturn in the world’s second-largest economy.

Growth-linked crude oil and copper prices are following stocks lower. Meanwhile, gold and silver are facing de-facto selling pressure as the risk-off mood reboots haven demand for the US dollar. A lackluster US economic calendar suggests sentiment trends are likely to be left to their own devices into the end of the trading week. This opens the door for the rout to continue as S&P 500 stock index futures point firmly lower ahead of the opening bell on Wall Street.

Comex E-Mini Copper (NY Close): $3.426 // +0.004 // +0.12%

Prices are pulling back from resistance at 3.435 to retest the 3.378-90 congestion area marked by the 23.6% Fibonacci expansion and a horizontal pivot barrier. A break lower initially exposes 3.300, followed by the 23.6% Fib at 3.268. Alternatively, a push above resistance targets 3.535.

WTI Crude Oil (NY Close): $93.36 // +0.01 // +0.01%

Prices are recoiling from resistance in the 93.21-90 area marked by the July 19 high and the 50% Fibonacci retracement, with sellers aiming to challenge support stands at the psychologically significant 90.00 figure. This barrier is reinforced by the 38.2% retracement at 89.87, with a push below that targets a rising trend line now at 88.01. Alternatively, a reversal through resistance initially targets the 61.8% Fib at 97.82.