Metals Chug Higher

I think theyre all looking a bit toppy, one floor trader said.

Zinc probed $1,070 resistance but had to back off under the weight of Chinese and producer selling to end the morning kerb $1,065 higher at $11 per tonne.

Investment funds have been heavy buyers in recent days with some talk linking international financier George Soros to the hefty gains that has taken the market from a low of $1,018 last week.With the Soros talk its become the flavour of the week and its over extending itself, the trader said.

Copper also failed to breach an upside barrier, colliding with the technical $1,970 level and ending the morning at $1,967, a gain of $17. Options activity ahead of next weeks declaration was injecting more volatility into the market with key strikes at $2,000 and $2,050, analysts said.

 

Stocks were expected down again today, but below Tuesdays draw of 13,475 tonnes. We expect stocks to fall by 8-11,000 tonnes, one floor trader said, while another placed the range at 5-10,000 tonnes.

It all depends on Singapore, one said, referring to talk that metal may start showing up in LME Singapore warehouses.

The premium of cash over three months material has also been whipping around, trading as low as $16 on Wednesday but doubling by the end of the day.

Yesterday, it firmed slightly up to $40. The three months to December 1997 spread also widened from $98 on Wednesday to $105. Aluminium managed, however, to breach and then hold a stance above its key $1,440 resistance, touching a high of $1,448 before last business was done at $1,445, a gain of $17.