Comex copper futures remained firm into the close on Tuesday, helped by the tumbling dollar, speculative and fund buying after a day rout. "The weak dollar helps, but there are still a lot of people trying to pick tops," said one New York dealer. "Certainly there's rollover business on the Comex, but a lot of the trading is brokers trying to pick the top of this market.
A lot of people are thinking this is a top and so they are trading it that way buying up to a top and then pulling off," the dealer added. Brokers said a large proportion of the Comex deals were switches into March futures and out of December, with first notice day for the benchmark contract set for November 30.
Benchmark December copper on the New York Mercantile Exchange's Comex divisions were up 0.85 cent to end at $1.4175 a lb, after trading from $1.40 to $1.4250. March also rose 0.85 cent to close at $1.4145.
The rest settled from 0.60 to 1.05 cents higher. Comex estimated about 31,000 lots, about 8,900 of them switches, had traded by the close, less than the 33,719 lots on Monday. Open interest surged by 3,309 contracts on Monday to 92,539.
The dollar resumed its downtrend; tumbling to a record low against the euro, on technical selling that followed a slide on the market belief that the US is comfortable with a weaker currency to reduce its current account deficit.
A falling dollar generally enhances holdings of dollar-denominated assets like copper for overseas investors. G20 finance ministers of industrial and developing nations issued a statement at the end of their Berlin conference over the weekend that made no mention of the dollar's slide.
Market participants read the lack of message to mean the US favoured a declining dollar to repair its gaping trade deficit, especially after Federal Reserve Chairman Alan Greenspan's comments on Friday highlighted the unsustainability of a huge current account shortfall.
US economic data released on Tuesday was somewhat helpful to copper prices.
US existing home sales fell in October, but were better than forecast. Home sales were down 0.1 percent last month to a 6.75 million unit annual rate, better than the 6.70 million unit rate predicted.
The Federal Reserve Bank of Chicago said its gauge of the national economy rebounded in October, helped by a turnaround in employment and production-related growth. The Chicago Feed's National Activity Index jumped to up 0.52 in October from an upwardly revised 0.04 decline in September.