LONDON: Copper prices retreated on Monday as the market fretted over demand in top consumer China and rising inventories in London Metal Exchange-registered warehouses, though losses were capped by a softer dollar.
Traders said volumes were subdued because of the Labour Day holiday in the United States. Benchmark copper on the LME traded 0.9% down at $8,425 a metric ton in official rings. Prices of the industrial metal touched a four-week high of $8,599 on Friday after a survey showed China’s factory activity expanded in August.
On the technical front, copper faces upside resistance around $8,590, where the 200-day moving average sits. Strong support comes in at $8,430-$8,440, between the 50-day and 100-day moving averages. Elsewhere, large holdings of LME warrants and cash contracts have fuelled worries about the availability of lead on the LME market.
Three-month lead was down 1.5% at $2,214.5 a ton. In other metals, aluminium ceded 1.8% to $2,196, zinc slipped 0.4% to $2,476, tin was up 0.3% at $25,890 and nickel fell 1.7% to $20,725. Nickel prices on the Shanghai Futures Exchange rose to 175,740 yuan, their highest in nearly four months, on concern over supplies after top exporter Indonesia delayed issuing mining quotas.