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Monday, October 25, 2021

MCX Copper under short covering; Support seen at 704

Technically Copper market is under short covering as market has witnessed drop in open interest by 29.22% to settled at 2093 while prices up 18.75 rupees.

Now MCX Copper is getting support at 704 and below same could see a test of 693.3 levels, and resistance is now likely to be seen at 721, a move above could see prices testing 727.3.

Copper yesterday settled up by 2.69% at 714.7 driven by easing default fears around property giant China Evergrande after its main unit said it would to pay some bond interest due later this week.

Risk sentiment was also supported by the People’s Bank of China injecting more liquidity into the market to replace certain expiring loans. China stood pat on its benchmark lending rate for corporate and household loans for the 17th straight month at its September fixing on Wednesday, matching market expectations.

The one-year loan prime rate (LPR) was kept at 3.85%. The five-year LPR remained at 4.65%.Most new and outstanding loans in China are based on the one-year LPR. The five-year rate influences the pricing of mortgages.

Chile’s state-owned Codelco, the world’s largest copper producer, said on September 15 that it had reached an agreement on a labour contract with a union representing workers in the Salvador branch in northern Chile.

The company said in a statement that the miner and the Benito Tapia Tapia No. 6 labour union have signed a 36-month agreement that includes a signing bonus of $5,200 and production-related benefits. China copper ore and concentrate imports in August stood at 1,885,984 mt, down 0.06% on the month but up 19.24% on the year.

Trading Ideas:
–Copper trading range for the day is 693.3-727.3.
–Copper prices advanced driven by easing default fears around property giant China Evergrande after its main unit said it would to pay some bond interest.
–China keeps lending benchmark LPR unchanged for 17th straight month.
–China copper ore and concentrate imports in August stood at 1,885,984 mt, down 0.06% on the month but up 19.24% on the year.

Courtesy: Kedia Commodities

Source: Comodity Online

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