Copper or Crude: Which one is right?

On Friday China reported its trade numbers. They were good. And they seemed to do nothing but instill confidence in China's economy recovery.

So you would expect a certain reaction from assets most closely ties to China's economy. I immediately think copper.

Indeed, copper imports into China did grow notably in January.

If we consider Friday's copper price action only, right after the news was released, the response was good. But the rally was more than erased yesterday. I didn't see any new catalyst that would have driven copper lower, so I can only think it should fall into the category "adverse price action relative to the news ..."

 

Currency Currents 12 February 2013

 

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