SMM Brief on Copper Futures on Aug. 8

SHANGHAI, Aug. 8 (SMM) –As LME copper prices plummeted by USD 200/mt last Friday, SHFE 1110 copper contract prices, the most active one, opened down RMB 1,610/mt at RMB 67,460/mt on Monday, with prices experiencing weak fluctuations during the whole trading day. The Shanghai Composite Index lost 2,500 points during trading hours after falling by more than 100 points, and LME copper prices failed to hold USD 9,000/mt and fell down to USD 8,950/mt while absorbing the news of a US credit downgrade. In this context, SHFE three-month copper contract prices fluctuated weakly around the daily moving average of RMB 67,600/mt under pressures from the shorts, with an intraday low at RMB 66,630/mt. Finally, the most actively-traded copper contract prices closed at RMB 67,680/mt, down RMB 1,390/mt, or a loss of 2.01%. Positions for the most actively-traded copper contracts were up 6,304 lots, while trading volumes were down 22,692 lots. Without support from all moving averages, SHFE copper prices were expected to fall further. China will announce important economic data tomorrow, and the US will also hold interest rate discussion meeting on the evening of August 9th, both of which will help decide the price trends in the near term. However, before that, the shorts will continue to dominate the market.