Copper Bolstered by Iran Optimism

Copper prices remain in the green today though, as yet, are still capped by the 6.1090-level resistance. A broad wave of risk-on trading amidst rising optimism around peace prospects in the Middle East is helping keep commodities prices underpinned here. Copper is also being helped by better data out of China overnight, feeding into positive demand expectations there. Trump signalled earlier this week that peace talks would likely resume this week and reiterated previous comments that he thinks the war could soon end altogether. Risk markets have cheered these comments with stocks and commodities rallying while USD and crude prices have softened over the week. While optimism continues to build, this dynamic should develop further with copper likely to breakout higher particularly if we see USD soften further.

China Q1 GDP Soars

Away from the Middle East, copper prospects are also helped by better data out of China. Q1 GDP was seen coming in at 5% YoY, up firmly form 4.5% prior and above the 4.8% the market was looking for. This growth marked the fastest expansion in three quarters and shows that the Chinese economy was recovering well ahead of the Iran war. Additionally, separate data showed that copper ore imports had risen almost 7% YoY in March, serving as further evidence of better demand for copper. Looking ahead, copper should continue to rally on any further data upside out of China given its status as the largest global consumer of the metal.

Technical Views

Copper

For now, the rally has stalled against the 6.1090 resistance. However, with momentum studies bullish, focus is on a continuation higher while price holds above the bull trend line and 5.8550 level with 6.2845 the next bull target to note.