Short term
Trade view / 01 September 2016 at 1:34 GMT

#SaxoStrats: Jiangxi Copper exposed on metal weakness, USD strength

Global Macro Strategist [Asia based] / Saxo Bank

Copper is potentially breaking lower on the back of a stronger USD and a Federal Reserve that is getting ready to hike, with September potentially a live meeting. At the same time, copper dynamics are under duress, as China cuts its imports while raising its copper exports. 

Demand woes could be set to continue, see the recent take by our commodity strategist Ole Hansen: Warning lights flashing for copper. Note we also offer equity options on Jiangxi Copper, allowing this to be expressed with long puts.

The key risks are: a poor nonfarm payroll number this Friday, weaker USD, China bounce, and supply disruptions.

Management and risk description


Entry: $HK 8.96 (close August 31).

Stop: $HK 9.50 (minus 5.7%).

Target: [50% clips] $HK 8.50 (+5.4%) , $HK 8.00 (+12.0).

Time horizon: one to three months.

Jiangxi Copper one-year
Source: Bloomberg

Jiangxi Copper five-year
Source: Bloomberg
– Edited by Gayle Bryant

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Non-independent investment research disclaimer applies. Read more
01 September
rzhi rzhi
I think there is a mistype on the right panel: should be 00358:xhkg instead of 00486:xhkg.


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