In the world of commodity trading, Copper has been a hot topic lately. According to TDS senior commodity strategist Daniel Ghali, there is an expectation of notable CTA buying activity in Copper markets during the upcoming session. This buying activity is believed to set the stage for subsequent buying exhaustion. However, Ghali notes that CTA trend followers may slow down their buying activity unless there is a substantial rally propelling Copper prices back towards the $9,800 per ton mark.
While Copper markets may see a slowdown in CTA buying activity, the set-up in Aluminium markets tells a different story. Ghali suggests that the set-up in Aluminium markets remains more favorable for continued CTA buying activity if the complex continues to rally. However, the set-up for algo flows in Aluminium is now considered to be symmetric, meaning that the direction of the market could go either way.
Looking ahead, Ghali predicts that only a big downtape could spark large-scale selling activity in Copper markets over the coming week. It is important to note that the set-up for flows is already asymmetrically tilted to the downside, indicating a potential shift in momentum towards selling. This information can be valuable for traders and investors who are monitoring the Copper markets and looking for potential buying or selling opportunities.
In summary, the Copper markets are expected to see a slowdown in CTA buying activity, potentially leading to buying exhaustion. On the other hand, the Aluminium markets may continue to see CTA buying activity if the complex rallies further. However, the set-up for algo flows in Aluminium is now considered to be symmetric. Overall, traders and investors should keep a close eye on both markets for potential opportunities and shifts in market dynamics.
