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Commodities: Copper futures rise most in 18 months as US Jobs Data fuels short squeeze

FXstreet.com (Barcelona) - It was a “risk on” day across all asset classes after the better than expected US Jobs Data helped fuel a sharp rally in both equities and commodities. The S&P 500 closed the week at a new all time high of 1614.40. However, the real action was in copper which had its largest move in 18 months. The 6.45% jump was likely helped by the fact the most recent COT report showed speculators holding the largest net short position in history (30,016 contracts). Gold managed to close the day 0.27% higher at 1470, while silver closed up 1.21% at 24.08. On a final note, oil also had a strong day closing up 1.72% at 95.61.

From a technical perspective, the move in copper was quite impressive and could be the sign of a major bottom being put in. The weekly chart put in an outside reversal bar (made a new intra week low, but closed above the previous week high) which could help fuel additional buying this week. Initial support is now located at 3.2480 (the 20dma), followed by 319.90 (the 9dma). The longer price can stay above these short term ma’s, the more constructive the daily chart will become going forward. Initial resistance sits at 332.90 (previous support, now resistance on daily chart), followed by 338.15 (the 50dma).

The close above 95 in oil is also impressive and could help fuel additional gains early next week. First resistance will now be the short term downtrend line on the weekly chart at 97.70, followed by 99 (resistance on weekly chart). Initial support sits at 94.90 (previous resistance, now support on daily chart), followed by 93.59 (the 9dma).

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