Comex copper finished with steep declines on Monday, toppled by heavy profit-taking from all sectors of the market that was initially triggered by a surge in the dollar, traders said.
"The dollar was a contributing factor. I don't think it was the entire cause. The selling was going to come regardless of what the dollar was doing," said one New York copper dealer.
The dollar hit a five-month high against the yen on Monday and steadied against the euro, with suspected Bank of Japan intervention keeping the greenback from sliding further after on Friday's disappointing US labour market data.
Spot March closed down 4.60 cents at $1.2920 per lb. The rest of the board settled 3.80 cents to 4.60 cents lower. Traders said the selling came from every quarter a mix of trade selling, fund selling, and speculative selling.
Comex estimated final copper volume at paltry 8,000 lots, following 12,253 on Friday. On Friday's open interest fell 680 to 77,745 lots.
London Metal Exchange 3-months copper slid to $2,862 per tonne at Monday's kerb close, well below $2,930 a tonne at Friday's close. The low extended down to $2,825. One analyst said he thinks London copper remains in a neutral corrective zone and defined support at $2,815.
LME copper warehouse stocks dropped 3,975 tonnes to 263,600 tonnes on Monday. Comex inventories fell 891 short tons to 237,358 short tons on Friday's daily data.