Copper prices on April 22 declined to Rs 724.30 per kg as participants increased their short positions as seen from open interest. The base metal traded in the red after a gap-down start in the evening session tracking lacklustre global cues.
The non-ferrous metal has been trading higher than 5, 20, 50, 100 and 200 days’ moving averages on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 66.30 which indicates bullish movement in prices.
Expectations for a boom in copper demand during the transition to a lower-carbon economy and global economic recovery have pushed prices back up towards a near 10-year high of $ 9,617 a tonne hit in February.
China’s refined copper output rose 18.2 percent year on year in March but the monthly total of 870,000 tonnes was the lowest since July, data from the National Bureau of Statistics showed.
Copper prices in London dropped on subdued demand from physical buyers reluctant to purchase the metal after a 21 percent rally in 2021, although a weaker dollar capped downside.
The market sentiment has been hit by concerns over rising coronavirus cases which threaten to derail the nascent pace of global economic recovery.
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited said, “MCX Copper has been trading with marginal sideways and negative bias since morning. Prices have been sustaining above support of Rs 715-720 levels from the previous three sessions. We may expect a bounce from these levels in the upcoming sessions and may witness market to trade higher levels at Rs 730-732.”
The US dollar trades marginally firm at 91.17, up 0.05 percent in the evening session against the rival currencies.
MCX METLDEX slumped 77 points, or 0.53 percent, at 14,532 at 18:52. The index tracks the real-time performance of key base metals.
In the futures market, copper for April delivery touched an intraday high of Rs 727.50 and a low of Rs 722.30 per kg on the MCX. So far in the current series, the base metal has touched a low of Rs 657.85 and a high of Rs 734.35.
Copper delivery for April slipped Rs 4.55, or 0.62 percent, to Rs 724.30 per kg at 19:01 hours with a business turnover of 2,108 lots. The same for May contract slides Rs 3.90, or 0.53 percent to Rs 730.10 per kg with a turnover of 2,359 lots.
The value of April and May’s contracts traded so far is Rs 1,038.11 crore and Rs 228.74 crore, respectively.
MCX Copper is likely to trade with positive bias for the session with support placed at Rs 721-718 whereas resistance is at Rs 728-732, said Motilal Oswal. The brokerage firm advised its clients to buy on dip for the session.
Geojit Financial Services said: “If prices remain above the downside hindrance of Rs 721 we could expect broad buying to continue. But a direct fall below the same may squeeze down prices lower.”
At 1338 (GMT), the red metal price was marginally lower at 0.19 percent, quoting at $ 9,429.75 per tonne in London.
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