Copper prices continued to pull back after hitting a fresh high earlier this week as China move to cool down the commodity prices and potential inflation concerns pressed industrial metals lower.
The non-ferrous metal maintained downside in the evening session despite worries about a strike in Chile and a softer dollar.
Copper delivery for May eased Rs 7.50, or 0.99 percent, to Rs 753 per kg at 19:51 hours with a business turnover of 3,509 lots. The same for June contract slides Rs 7.50, or 0.98 percent to Rs 757.85 per kg with a turnover of 2,030 lots.
The value of May and June’s contracts traded so far is Rs 2,774.25 crore and Rs 422.02 crore, respectively.
MCX METLDEX dropped 157 points, or 1.04 percent, at 14,901 at 19:52. The index tracks the real-time performance of key base metals.
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited said, “MCX Copper has been trading with negative bias and price declined approximately 30 points in the previous session and traded in the support zone of Rs 756-748. A marginal correction against the current downtrend has already been witnessed and the market made a high of Rs 766.7 which could get tested again in the evening session.”
LME supplies for copper are in marginal surplus for the day which may support the bearish move.
The Yangshan copper premium which reflects Chinese demand for the imported metal, rose for the first time since February on Monday to $ 38.50 a tonne, rebounding from a more than five-year low of $ 37 a tonne hit last week.
Copper, the leader metal, touched record higher levels across exchanges on the back of a tighter supply market, increasing investments towards the green revolution and revival of global economies earlier in the week.
“Global industries vouching to curb carbon emission has kept the entire industrial metals spectrum on the dais. With the world moving towards a greener environment amid the noteworthy expansion in the Electric Vehicle segment, demand for industrial metals is set to multiply in the years to come”, said Yash Sawant, Research Associate, Angel Broking Ltd.
The US dollar slumped to 89.86, down 0.36 percent in the evening session against the rival currencies.
The non-ferrous metal has been trading higher than 50, 100 and 200 days’ moving averages but lower than the 5 and 20 days’ moving average on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 49.96, which indicates neutral movement in prices.
At 14:35 (GMT), the reddish-brown metal price fell 0.55 percent to quote at $ 10,018 per tonne in London.
MCX Copper price is expected to trade in a bearish trend with resistance at Rs 763 level and intermediate resistance at Rs 759 level, said Motilal Oswal. The brokerage advised its clients to sell on rallies targeting lower support at Rs 753-750 zone.
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