US copper futures climbed more than 2 percent at the open on Tuesday as speculative interest returned to the market, leaving prices just shy of key technical chart points, traders said.
"Specs are bidding it up and there is little selling pressure to limit the advance. However, the volumes continue to be on the light side, so we'll have to see if there is enough behind this move to break resistance at around the $2.60-$2.61 level," said one floor dealer.
Copper for March delivery was up 6.35 cents, or 2.5 percent, at $2.5930 a lb. by 10:07 am EST (1507 GMT) on the New York Mercantile Exchange's COMEX division, near the upper end of its early $2.5165-$2.5970 trading band.
Floor traders pegged support in March copper at the January 8 low of $2.47, followed by $2.4060. Resistance was seen at $2.60 and then at $2.70. Spot January jumped 4.05 cents to a morning peak at $2.56. Volume by 9 am was estimated at a modest 1,000 lots.
March copper has declined nearly 11 percent since the start of the year on weaker US demand, reduced risk of further supply disruptions and softer Chinese demand, analysts said. However, they predicted a recovery in copper prices in the second half of the year amid an expected rebound in demand.
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