Market Overview - Copper prices experienced a dramatic drop after reaching a historical high of $11,771 per ton, closing at $11,487 per ton, a decrease of 1.29% [1] - Other base metals such as aluminum, lead, and zinc also fell, reflecting a cautious sentiment in the commodity market [3] Federal Reserve Influence - The market's downturn occurred just before the Federal Reserve's December meeting, with expectations of a 25 basis point rate cut, but concerns arose that this might be the last cut of the current cycle [3][5] - Investor sentiment shifted, with expectations of only two more rate cuts by the end of 2026, down from three a week prior, prompting profit-taking ahead of the meeting [5] Supply and Demand Dynamics - U.S. copper inventories surged to a record 443,000 short tons (approximately 402,000 metric tons), increasing over 300% since the beginning of the year, driven by policy interventions rather than a global oversupply [7] - The disparity in copper supply is evident, with high U.S. inventories contrasting with tight supplies in Asia, leading to a "North America hoarding, Eurasia tightness" scenario [9] Production Challenges - Global copper production faced disruptions due to incidents at major mines, such as the Grasberg mine in Indonesia and the El Teniente mine in Chile, leading to a significant shift in supply forecasts [11] - The International Copper Study Group revised its projections, now anticipating a shortage of 15,000 tons in 2025 and a further increase to a 30,000-ton deficit in 2026 [11] Chinese Market Conditions - China's copper concentrate processing fees remained in negative territory, indicating extreme tightness in the raw materials market, prompting plans for production cuts in the copper smelting industry [13] - Demand in China, the largest copper consumer, has shown signs of weakness, with recent economic stimulus discussions falling short of market expectations [13][15] Sector Performance - The high copper prices have negatively impacted actual demand, with processing fees for copper rods in Jiangsu province dropping to a historical low of -300 yuan per ton [15] - In contrast, the new energy sector showed strong performance, with copper foil production increasing significantly, indicating a divergence in demand across different sectors [17] Market Sentiment and Speculation - Speculative positions in copper reached a historical high, with non-commercial net long positions at 78%, indicating extreme bullish sentiment among traders [17] - The significant amount of capital in domestic copper futures has surpassed 50 billion yuan, making it the second-largest commodity futures category, highlighting the market's sensitivity to macroeconomic news [17]

Core Insights - The article presents a comprehensive market monitoring dashboard covering multiple asset classes, including stocks, forex, commodities, and cryptocurrencies, providing traders with indicators for trend, reversal, volatility, and overbought/oversold conditions [1]. Asset Classification - The assets are categorized into four main classes: Equity, FX, Commodities, and Crypto, each with specific indicators for analysis [2]. Key Assets and Recent Changes - Key assets to focus on include: - **Equity**: SP500_US and Nasdaq100_US are highlighted for their significant volatility and potential for trend continuation or reversal [1]. - **China Stocks**: CSI300_China and SSE_China are noted for their low valuations and potential rebound, albeit with high volatility [1]. - **Forex**: USDJPY and USDCNY are emphasized due to significant central bank policy differences, while EURUSD and GBPUSD are suitable for macro hedging [1]. - **Commodities**: Gold and CrudeWTI are driven by safe-haven demand and inflation expectations, while CopperHG and Soybean are sensitive to economic cycles and Chinese demand [1]. - **Cryptocurrency**: BTCUSD and ETHUSD are recognized for their high volatility and suitability for swing trading [1]. Potential Trading Opportunities - Trading opportunities are identified based on specific numerical indicators, such as extreme Sigma values indicating potential rebounds or trend continuations [3]. Suggested Operational Framework - Strategies include: - **Rebound Opportunities**: Identifying assets with low Sigma values and reversal signals for potential rebounds [4]. - **Trend Continuation**: Following assets where EMA20 is above EMA100, indicating an upward trend [4]. - **Volatility Strategies**: Utilizing high VolRank and rising ATR% for options strategies or breakout trades [4]. Risk Considerations - Risks include: - **Overbought Risks**: High Sigma values indicating potential short-term overheating [4]. - **Trend Reversal Risks**: Signals indicating potential reversals, especially with high deviation [4]. - **Liquidity/Volatility Risks**: Extreme market conditions requiring position control [4]. Multi-Asset Comparison and Risk Management - Emphasis on comparing assets within the same category and using multiple indicators for comprehensive analysis [4]. - Risk management is prioritized, with all trades requiring stop-loss measures based on volatility and drawdown metrics [4]. - The technical analysis should be complemented with macroeconomic factors such as central bank policies and geopolitical events [4].