Hedge funds have never been this bullish about copper price
After hitting an 18-month high on an intraday basis on Monday, the copper price has come under pressure as the bullishness about the impact of Trump's $500 billion infrastructure plans on demand for the bellwether metal begins to cool.
In Asian trade on Wednesday copper for delivery in March, the most active contract, exchanged hands for $2.5570 per pound ($5,637 a tonne) on the Comex market in New York. Copper is now down 7% from this week's peak.
After vastly underperforming other metals and steelmaking raw materials in 2016, copper is still looking much healthier than pre-Trump with a 20% rise year-to-date.
The change in sentiment is striking considering the radical shift in the positioning of large-scale derivatives speculators such as hedge funds.
While continuing to reduce bullish silver, platinum and gold bets, on the copper market hedge funds have added to long positions – bets on higher prices in future – for three weeks in a row.
According to the CFTC's weekly Commitment of Traders data up to November 22 (released yesterday due to the US long weekend) so-called managed money investors have taken the net long to an all-time high of 76,346 lots or the equivalent of just over 1.9 billion pounds.
Saxo Bank points out that this is a whopping 55% above the previous record from July 2014: