Why Chinese GDP Will Likely be 6.7 Percent
The Chinese GDP number should be in the 6.7% range for the quarter, yes even with China massaging the numbers like a General Electric Company (NYSE:GE) accountant under Jack Welch, anything in the 7% is just flat out an invalid number based upon the economic number coming out of China the last six months. So Chinese GDP either gives a credible number and the market tanks for anything industrial commodity related, or they make up such a patently false number, and lose all credibility, leading to suspicions that things are so bad that they have to blatantly fix the numbers which don`t even remotely match the econ data.
The market will tank under this scenario as well. This is the black swan, Europe is bad, but emerging markets are imploding and Sunday night market participants are finally going to take notice that they can no longer ignore the China bubble collapsing due to excessive lending of the last ten years that is finally coming to roost.
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Copper has been moved back up to $3.19 a pound, it is an easy short back to the $3 a pound level by Sunday night through Monday morning. Oil will get creamed as well as of this writing oil is sitting just above the next level of support with WTI set to break the $104, $102, and $100 levels next week as stops get hit in mass exodus on the way down, and the shorts pile in after each technical level breaks. Gold and Silver have been getting slammed after bad Chinese data the past several months and it will be interesting to see if the pattern continues after the sharks have covered their shorts.
Chinese GDP and Copper
Copper should probably be trading below $2.50 a pound for example, and Brent and WTI both under $90 a barrel. Especially if you consider Chinese GDP slows growth by over 7% in the last two years. Yes the Commodity Super Cycle is over folks. QE has held these two commodities up for as long as they possibly could, but China is the prime factor regarding taking major demand for these commodities out of the market. It only a matter of time before these two commodities start to get attacked by the shorts like Iron-ore prices, and my guess is Sunday night with China`s release of GDP with a number in the 6.7% range gets their attention real quick!