Copper prices soared to Rs 610.85 per kg on January 18 as participants increased their long position as seen by the open interest. The base metal extended gain after a flat-to-positive open on a rebound in China’s GDP data.
Copper had declined Rs 17.2 or 2.76 percent last week on the MCX.
The Chinese economy grew by 6.5 percent in the last quarter against the previous 4.9 percent growth in the third quarter. China’s GDP grew by 2.3 percent in 2020.
ShFE copper inventories fell to their lowest in more than nine years at 73,685 tonnes and top producer Codelco increased precautionary measures against the coronavirus at its mines after an uptick supported the base metal.
Hedge funds and money managers reduced their bullish positions in COMEX Copper contracts by 4,319 contracts to 76,449 in the week to January 12, according to CFTC data.
The US dollar trades higher at 90.82 or up 0.08 percent in the evening session.
Neha Qureshi, Technical Research Analyst at Reliance Securities said, “LME Copper has bounced back from $7,900 levels where it also hold the support of 21-Daily Moving Average which is placed at $7,890 levels indicating for sideways to marginal upside momentum up to $8,050-$8,088 levels. MCX Copper January is trading above 21-Daily Moving Average which is placed at Rs 607 levels. Therefore indicating for positive momentum up to Rs 613-615 whereas support is at Rs 608-605 levels.”
She advised her clients to buy January Copper future at Rs 607-606.50 with a stop loss at Rs 604 and for a target of Rs 613.
MCX iCOMDEX Base Metal Index jumped 67.74 points, or 0.50 percent, at 13,693.02 at 16:47.
In the futures market, copper for January delivery touched an intraday high of Rs 612.45 and a low of Rs 605.40 per kg on the MCX. So far in the current series, the base metal has touched a low of Rs 548 and a high of Rs 631.20.
Copper delivery for January gained Rs 5.55, or 0.92 percent, to Rs 610.85 per kg at 16:48 hours with a business turnover of 3,784 lots. The same for February contract rose Rs 5.10, or 0.84 percent to Rs 612.75 per kg with a turnover of 1,250 lots.
The value of January and February’s contracts traded so far is Rs 910.26 crore and Rs 78.61 crore, respectively.
Tapan Patel- Senior Analyst (Commodities), HDFC Securities, said MCX Copper January support lies at Rs 608 and resistance at Rs 615.
At 1120 (GMT), the red metal price edged up 1.05 percent to quote at $8,016.75 per tonne in London.
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