Guoxin Futures: Macro bearish logic dominates; copper prices temporarily on hold after breaking below support

After breaking below a key support level, the decline in copper prices further expanded, piercing below 94,000 yuan per ton, with the main contract increasing by more than 15,000 lots. On the spot market, according to SMM data, on March 19th, the average price of No. 1 electrolytic copper was 95,615 yuan/ton, down 3,375 yuan/ton from the previous trading day, with copper prices falling sharply and market trading activity picking up. The worsening situation in the Middle East caused a sharp rise in crude oil prices, the Federal Reserve delaying interest rate cuts, collectively forming macroeconomic bearish factors, and short sellers increasing positions, driving copper prices downward. On the other hand, the recent weakness in copper prices has gradually stimulated downstream and terminal market participants’ enthusiasm for stockpiling and placing orders. According to SMM surveys, after the copper price center shifted downward, market buying interest has significantly rebounded. Downstream processing companies reported that recent order volumes from terminal enterprises have increased, actively replenishing raw material inventories during the copper price correction. Meanwhile, upstream smelters also reported high buying sentiment in the spot market, with active downstream procurement and smooth overall transactions, reflecting real demand support from the industry. Overall, current macro bearish factors and stagflation concerns dominate the copper market trading logic, with short sellers gaining strength. After copper prices quickly broke below key support levels, market panic may intensify. It is recommended to reduce positions on existing long orders to control risk, hold off on new positions for now, and continue to monitor developments in the Middle East. (Guoxin Futures)