Network Metals LLC

***BREAKING NEWS – we have learned that the Chinese SRB is now lending copper. They are delivery their recently purchased physical stockpiles to the Shanghai Futures Exchange and buying back the forwards, thereby earning the backwardation that currently exists. This would seem to mark an end to SRB copper buying for the time being.

More analysts and commentators are coming around to the conclusion about the current base metals run that more conservative analysts, ourselves included, have been espousing for the past few weeks. Copper is down sharply today on LME trading. While copper has been flying up the charts, from January up until and including last Friday, it is becoming clear that much of the buying has been from the Chinese for public and private reserves. This buying contributes to falling exchange inventories, but does not reflect real recovery or actual demand; that metal is still floating around somewhere unused, and is mostly in China now. Conventional technical analysis still reveals what some believe to be base metals strength, especially in copper and zinc, but even these analysts are now advocating waiting for a possible impending sell-off.