Analysis of copper price trend in Yangtze River spot market (9.4-9.8)

On the macro front: The recent release of non-farm payrolls in August was sharply lower than expected, indicating a tightening of the US labor market, while the resignation of Fed hawk Fisher made the pace of interest rate hikes in the second half of the year more uncertain, and the outlook for the dollar under pressure fell below the 92 mark, the lowest since January 2015, and copper prices once again gained upward momentum
。 But North Korea announced a successful hydrogen bomb test on Sunday, its sixth and most powerful nuclear test in its history, and after the North Korean nuclear test, the United States announced that it would make an "effective and overwhelming large-scale military response", the market panic about the war was rekindled, safe-haven assets regained investors, and copper prices temporarily slowed
down.

Market: Copper prices experienced Black Friday this week, and the decline in Shanghai copper quickly expanded to more than 1,000 yuan on Friday afternoon, but copper prices were relatively stable
in previous days.
Therefore, in fact, from Monday to Thursday this week, the overall market sentiment is still strong, and merchants are mostly bullish or bearish in the future, and there are few bearers
.
Therefore, in the first four days of the week, the willingness of the holders to cover the goods is very strong, so that the spot copper premium continues to rise, and the highest good copper has been reported to rise to about
80.
However, the downstream performance is more cautious in taking goods, mostly maintaining on-demand buying operations, except for Wednesday, the actual downstream demand is mostly poor
.
On Friday, although copper prices fell sharply, they did not trigger downstream buying, as market panic appeared, fearing that copper prices showed a unilateral downward pattern, so they still maintained a wait-and-see trend
.
As far as the future market is concerned, the current market bearish sentiment is strong, so it is expected that the market supply will increase next week, but it is unlikely that demand will improve
significantly.

In terms of inventories: London copper inventories continued to decline this week, with a cumulative weekly reduction of 10,325 metric tons to 213175 metric tons, a cumulative decrease of 4.
62%.

Shanghai copper inventories fell by 10,735 tonnes to 183582 tonnes this week, down about 5.
85%, a seven-week low
.
In general, the current global inventory (including China's free trade zone) is still in the stage of destocking, although the decline rate has slowed down, but the current downstream orders are still very sufficient, if the copper price has a large pullback will be conducive to its replenishment of inventory, so that global inventories continue to decline
.
In addition, it is worth noting that there are rumors in the market that hundreds of thousands of electrolytic copper will be handed over to the LME next week, and if this is the case, the destocking phase may be over
.

Future market analysis: On the whole, the profit taking of funds is an important reason for this pullback, not only copper varieties, but also other non-ferrous metals have retraced
sharply.
Due to the lack of directional guidance from major news, coupled with the recent copper price rally is too ferocious, the market's continued bullish confidence is slightly insufficient, and the risk of copper prices falling next week is expected to increase
.
However, it should be pointed out that the pullback after the continuous surge is a technical need, and the short-term still needs to be volatile consolidation
.
In the long run, the fundamentals have not changed much, the macro data is favorable, and copper prices still have room
to rise.