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Market Nuggets: R.J. O’Brien Favors Buying Price Dips In Copper

Tuesday August 27, 2013 9:50 AM

R.J. O’Brien & Associates describes a stand-off in copper at the moment between the bulls and bears but says its own preference is to buy dips. The firm puts support for three-month copper on the London Metal Exchange at $7,200 to $7,220 a metric ton and resistance around $7,410 to $7,420. “Fundamentally speaking, copper is torn between the bulls and the bears,” R.J. O’Brien says. “The bulls point to the improving Chinese economy and the initial signs of recovery in Europe as good reason to be buying the dip. The bears, on the other hand, are now beginning to worry about the health of the other emerging markets such as India, Brazil, Russia, and Indonesia.” R.J. O’Brien later adds: “Our own preference would be to buy any good dips that develop as we feel that Chinese demand will be improving over coming months, as will European demand….And we suspect we will see more tightness develop in the European market along with higher premiums.”