The Federal Reserve finally ended the dilemma as the Federal Open Market Committee increased the overnight funds rate to a range of 2.00% to 2.25%, which had already been factored in most of the commodity prices. On analysis of the movement of the base metals, particularly Copper and Zinc, futures in different time frames since the release of final outcome of the Fed minutes, I find the base metal bears look too eager to move downward very soon. The profit growth at China's industrial firms slowed to a five-month low in August, fanning concerns about faltering domestic demand in the world's second-largest economy as escalating trade frictions with the United States cloud its outlook. Demand for raw materials and industrial products has taken a hit this year as business expansion plans slowed, restrained by tighter funding due to China's multi-year campaign to curb corporate debt and crack down on risky borrowing. A softer property market has also sapped construction-related demand.
Since the escalating tariff trade war has dented a lot to most the global economies, which encourage base metal bears to become more furious than ever before. Let's have a look at the current position of Copper and Zinc in the following charts.
COPPER
ZINC
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