US copper futures jumped after a mild start early on Tuesday, when funds renewed their buying interest after a slew of stronger-than-expected US economic news and widespread fears of a short squeeze if a rumoured huge short position comes due in December, traders said.
There has been widespread speculation in the copper market that China's State Reserve Bureau is holding a large short position on the LME, a bet that prices will fall.
The COMEX division of the New York Mercantile Exchange's benchmark December futures set a fresh contract high at $1.9405 per lb, then pulled off the high to steady around $1.9370, up 2.35 cents.
Spot November advanced 1.85 cents to $2.0250 a lb, holding at a level never seen before on the COMEX floor. COMEX estimated 1000 am EST copper volume at 5,000 lots.