Technically market is getting support at 409.8 and below same could see a test of 407.2 levels and resistance is now likely to be seen at 416.9, a move above could see prices testing 421.4.
Copper on MCX settled down 1.16% at 412.40 dropped in the line of expectation slipped as optimism over US-China trade talks faded and poor China data weighed, though a weaker dollar and still tight supply-side conditions kept losses in check.
China said the three days of talks in Beijing had established a "foundation" to resolve the two country's differences, but gave virtually nothing in the way of details on key issues at stake. At the same time, the world's biggest base metals consumer released data showing factory-gate inflation rose at its slowest rate in more than two years.
Pressure also seen as complete base metals complex except for LME lead, dipped across the board. LME zinc lost 1.37%, copper declined 0.79%, nickel and aluminium slipped. Last night the US dollar rebounded from three-month lows, extending gains against the euro and yen, after Federal Reserve Chairman Jerome Powell said that the US central bank intends to further shrink the balance sheet, suggesting it is not done tightening monetary policy.
The Fed chairman also said he sees no near-term risk of a US recession and expects continued momentum in economic data. However, he reiterated that the Fed can be patient on monetary policy and can move "flexibly and quickly" if economic data warrants it.
While European Central Bank officials agreed that a cut to their 2019 growth projection in itself acknowledged that risks to the outlook for the eurozone economy had increased.
"Uncertainties and risks related to geopolitical factors, the threat of protectionism, vulnerabilities in emerging markets and financial volatility had retained prominent," the ECB said in the account of its Dec 12-13 policy meeting published on January 10. Now a day ahead the US is expected to release data on its CPI for December today.
--Copper trading range for the day is 407.2-421.4.
--Copper dropped as lower-than-expected inflation data from China depressed market sentiment.
--Recent transactions in the refined and scrap copper markets have been ordinary, consistent with the off-season.
--China's commerce ministry said trade talks with the US were extensive and detailed, and established a foundation for the resolution of each other’s concerns.
Courtesy: Kedia Commodities