China's heavy hand moving markets

摘要

One look at the raging bull markets that took place in a variety of commodities over the last 18 months may be a clue that something special is happening behind the scenes. While a variety of factors can combine to drive a bull market, the almost insatiable demand from a nation of 1.28 billion has been a key fundamental in driving prices up in raw materials ranging from rice to nickel. That nation is China, and its economic revolution continues to provide excellent opportunities for traders. Futures traders have enjoyed solid and tradable uptrends in many of these commodities. However, many contracts have reached historically high prices, and some in the trade are questioning how long the trends can continue, especially now that China has expressed intentions to slow its rate of growth. After all, there is a price level at which Chinese demand is priced into the market and where producers will increase production rates.