Commodities

Copper again made fresh decade highs last week and while we remain bullish base metals & the reflation trade in general we don’t believe the risk / reward favours chasing the current break out, at this stage MM is neutral looking for re-entry levels into the sector. Interestingly the $A hasn’t embraced the recent push higher by commodities which adds weight to our view that this is breakout may not to be one to chase although we cannot ignore the increasing momentum which could lead to us changing this conservative stance very quickly.