Copper down in Asia

Copper futures fell about 0.5 percent in Asia on Monday, pressured by Chinese sales and speculative selling reflecting a stronger dollar, but underlying sentiment was bullish amid concerns over tight supplies. Rounds of sales led from China weighed on London Metal Exchange copper futures in thin trading, but the market was still keen to test the key three-month futures towards a record high of $3,338 per tonne hit on the Select on April 12.
"The market is still bullish given this tight supply condition," said an LME trader at a Japanese trading house. The three-month LME copper contract was trading at $3,282/$3,287 per tonne, down 0.55 percent from a late London level of $3,300 on Friday.
The trader said the key copper contract was facing technical resistance around $3,320-$3,325 a high hit last week. Still, the technical trend was strong after breaking several major chart points, including its seven-day moving average last week.
Copper was also being supported by scant inventories, with LME warehouse stocks below 40,000 tonnes, a 31-year low, having fallen by 2,000 tonnes on Friday.
Copper and other LME metals were weighed down as the dollar advanced strongly to a nine-month high against the euro in Asia. Sentiment for the dollar improved following a smaller-than-expected widening of the US trade deficit on Friday. The US trade shortfall was just under $57 billion in April, compared with economists' forecasts of $58 billion. The March deficit was revised downward to $53.6 billion from $55 billion.
"Profit-takers are using a firmer dollar this as an excuse to sell copper, but the influence of the dollar is not expected to have a long-term impact," said another LME trader.
The euro was trading at $1.2095/99, compared with around $1.2120 in late New York on Friday. It had dropped to as low as $1.2070, its lowest mark since September 8, in Asia.
In Shanghai, the most active August copper futures rose 370 yuan a tonne from Friday's settlement to 32,760 yuan. Three-month LME aluminium was little changed at $1,717/$1,722 per tonne against $1,715 in London.
The key August Shanghai aluminium futures rose 10 yuan from Friday's settlement to 16,780 yuan. The three-month nickel contact was quoted at $15,900/$16,000 per tonne, little changed from $15,925 in London.
LME tin futures were quoted at $7,550/$7,600 per tonne against $7,580 in London.
LME zinc was at $1,290/$1,295 per tonne against $1,292 on Friday. Lead futures were at $965/$970 against $963 in London.