copper intraday

Copper fell to the lowest in more than two months
13 June 2008 10:29:57



Copper fell to the lowest in more than two months as the dollar strengthened, curbing demand from investors who buy commodities as a hedge against inflation.

The U.S. Dollar Index jumped as much as 1.1 percent today, rising to the highest level since February. The gauge, which includes the euro and yen among six major currencies, has rebounded 4.5 percent since touching a record low on March 17. Copper lost 7.6 percent in May as inflation concerns eased.

The dollar strengthened as U.S. retail sales advanced 1 percent in May, more than economists forecast, raising speculation that the Federal Reserve will increase borrowing costs as early as August.

U.S. retail sales also rose 0.4 percent in April, higher than first estimated, the Commerce Department said today. The median forecast of economists surveyed by Bloomberg News was for a 0.5 percent increase in May.

Trading in interest-rate futures shows an 18 percent chance the Fed will raise its target bank-lending rate to 2.25 percent in its next policy meeting later this month, up from no chance a week ago. Futures also show a 55 percent chance the Fed will take that step in August, up from a 6.7 percent last week.

The metal also fell today on concern that slumping global economic growth will cut demand for the metal used in pipes and wires, Selkin said. The price has dropped 17 percent since reaching a record $4.2605 a pound on May 5 on speculation that consumption would decline.

China, the world's largest copper user, reduced imports 9.8 percent to about 198,900 metric tons in May from about 220,600 tons a year earlier, the Beijing-based customs office said yesterday. Imports fell 19 percent from April, the agency said.

LME inventory decreased by 650 MT to 120625 MT.

MCX Copper June - Technical Outlook:

The daily stochastics have crossed over down which is a bearish indication. The prices closed below short term and medium term EMA, which supports bears. MACD is heading downwards in positive region, showing decrease in bullish momentum.


Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 332.42 levels. If broken can see further fall to 329.83 and 327.27, If market holds above 334.98 further rally can be seen towards 337.57 and 340.13

Recommendations-MCX Copper June: Sell at 336.50 Target 333 and 331 SL 339.80

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