Comex copper closed higher on Wednesday on technical buying that boosted September futures to just below chart resistance, as traders digested on Tuesdays US interest rate hike and turned their focus to further economic data later this week.
"The market had come off on the back of dollar strength, but then there was spec buying that went through the moving averages and hit stop-loss buy orders.
Brokers were marking it up to touch off the stops," a New York desk trader said. Active September copper settled at $1.2725 a lb, up 1.55 cents, on the New York Mercantile Exchanges Comex division, after trading from $1.2490 to $1.2750.
It was stuck in a technical trading gap from $1.2560 to resistance around $1.2750, while support lurked down near $1.22 a lb, traders said.
In other months, Comex spot August advanced 1.50 cents to $1.2760 while next active December climbed 1.40 to $1.26.
Estimated volume hit a moderate 15,000 contracts and mainly reflected rollover from September copper into December futures before delivery period starts in three weeks, traders said.
The market faded the dollar moves in narrow range trading as participants awaited on Thursdays US weekly jobs figures and July retail sales data to see whether they confirm the Federal Reserves optimistic view on the economy.
"There was some selling in copper related to the dollar move but copper quickly recovered," said Man Financial in a daily report.
The dollar firmed against the euro on Wednesday after the Federal Reserves decision on Tuesday to raise the benchmark federal funds rate a quarter-percentage-point to 1.50 percent.
On the labour front, Group Mexico reached a labour accord with union leaders to avert a strike at its massive Cananea operations in Mexico but the agreement still needs to be approved by workers in votes on Wednesday and Thursday, the union said.
Group Mexico still faces a strike threat at its US unit Asarco, where talks with unions are due to resume on August 16.