COPPER

FUNDAMENTALS

China had more to do with copper prices Friday. MCX Copper near month contract jumped more than 4% and a substantial rise in copper prices was also seen at the benchmark London Metal Exchange.

Copper prices shot up after the release of SHFE warehouse weekly report that disclosed the exchange’s copper inventories fell significantly lower during the week. Moreover year end trading resulted in short covering. Also dollars weakness, gains in crude oil prices, huge profits in equity markets helped push copper up.

China is expected to come forward for buying as its inventories have started dipping and copper prices are already at substantially reduced levels. Though US economic health’s concerns still prevail but a series of better than expected US economic data released this week mildly eased them.

Moreover ICSG & WBMS reports of copper markets deficit also favored buyers. ICSG recently revealed world refined copper market saw a deficit of 265,000 mt during January-September against same period last year’s 21,000 mt surplus. WBMS disclosed a deficit of 207,000 mt during January-October.

TECHNICALS

Candlestick pattern is showing bullish sentiments. Prices have closed above short and medium term EMA’s showing firmness. MACD has made a bullish crossover in negative zone showing decreasing bearish momentum. Stochastic and RSI are rising in neutral region indicating firmness. Copper may trade volatile during the reduced hour Saturday’s session at the MCX. .

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