Lme Copper Loses Breath After Breaking Barrier
Many traders expected further short-term strength, but others were wary of producer selling at higher levels. Its about time. Just look at the charts. Copper has built a huge base, one said.
It appeared that extensive selling between $1,950 and $1,970 per tonne which had repeatedly stalled any rises may have ben overcome or the time being, he added. Three months copper knocked over the $1,970 barrier on its way to touching $1,990, equalling the high of September 27. It was mostly the funds, plus some short-covering.
The funds started buying yesterday and came in again today, another floor trader said. There was short-covering between $1,965 and $1,970, then stops were hit at $1,980 and above.
Copper finished the morning kerb at $1,979, up $19. Traders noted large volumes of late 1996 contracts being rolled over into the New Year, with one deal comprising 400 lots of Nov-three months.
Aluminium also rallied, spiking above the psychological $1,400 level for the first time since September 30 to $1,406. It managed to keep its foothold above $1,400 to end the morning up $35 at $1,402.
Chartists peg the next target as $1,420, the highs of September 27 and 20.
The other metals gained confidence from the strength in copper and aluminium, with nickel advancing to a high of $7,230, a resistance area. It ended $25 higher at $7,185.
After $7,230, the next barrier is seen as $7,300, with support pegged at $7,175, Tuesdays high and Wednesdays low.
Lead gained $6 to $738 while zinc added $3 to $1,028.
Tin edged above the $6,000 level, ending the morning kerb $20 higher at $6,010.
Alloy followed the primary market up, closing the kerb at $1,270 from $1,245.