Metals bounce back

Base metals resumed their upward trend on Tuesday after the previous day's correction on the London Metal Exchange (LME), with copper targeting last week's record $4,478 a tonne peak and beyond, dealers said.
"Copper ran into some pretty good trade buying as it bottomed out earlier then the funds moved in later on. I am not sure what it will take to stop copper rising," one trader said.
"The fundamentals of the market have nothing to do with the price. Metal is readily available and there is plenty of concentrate around," he added.
Copper, which fell nearly two percent on Monday, rallied strongly from a brief early dip to $4,348, trading back up to $4,458 a tonne, up $84 or 1.9 percent.
Monday's sell-off in copper and similar declines in other major movers aluminium, zinc and lead appeared to have tempted buyers back into the market, they said.
Since copper leapt above $4,000, there have been few real downturns, as speculative buyers and funds maintain their long-side exposure and short-selling has proved to be short-lived.
Next week's December date pricing might not be the crunch period for the major Chinese short positions that some investors had expected.
"With the prime date now just over a week away it looks as though the fear of Chinese short covering has eased, but whether the shorts will be tempted to test the water ahead of the December date remains to be seen," BaseMEtals.com analyst Will Adams said.
Aluminium also reversed direction after testing below $2,200 earlier. By the close it was $17 stronger at $2,248 and on course to test Monday's 17-year peak of $2,289.
"There was pretty good support at $2,200, despite attempts to push it lower. With the uncertainty about Chinese production and export levels next year, you can't afford to be anything but long of the metal," another trader said.
Zinc recovered from under $1,800 to trade $43 higher at $1,835. On Monday it reached a 16-3/4 year peak of $1,863.
Lead was $9 higher at $1,106 having peaked at $1,125 on Monday. Nickel fell $50 to $14,200, but tin was $50 higher at $6,925/930.