London Metal Exchange (LME) copper futures ended trading little changed on Tuesday as the market consolidated after recent volatility, dealers said. The three-months price closed at $3,618 a tonne from $3,622 at Monday's kerb close. Prices have swung about $150 in the past week, bouncing off a low around $3,510 on Friday after hitting a record high of $3,670 earlier that week.
"There was some option-related and two-way trade business but things were generally fairly quiet," a dealer said.
"However, the backwardation is still pretty strong and with such tightness evident near-term copper is consolidating quietly above $3,600 for a re-test of the record high."
Copper's cash/threes backwardation, or premium commanded for prompt delivery, is currently around $225/235 a tonne, against levels below $200 last week.
And with supply and demand still finely balanced, premiums have the potential to flare up suddenly.
Basemetal.com's William Adams said copper would need to climb above the all-time high to signal a continued uptrend, while aluminium needed to rise above $1,950.
"If these levels can be taken out quickly it would be a sign of underlying market strength as on the way up there is likely to be further producer selling," he said in a daily market note.
"Overall, the market is expected to remain volatile...it may too early to say that last week's sell-off has run its course and a second wave down would not be too surprising, particularly if copper stocks rose again."
Aluminium was at $1,920, down $4, while nickel was at $14,850, down $270. Other metals prices were slightly weaker.