Copper prices have hit a 10-year high, after concerns that supplies will tighten further when the world recovers from the coronavirus pandemic.
Copper prices have nearly doubled since the March 2020 crash, fueled by recovering demand from China and supply shortfalls that have arisen from several strikes in the world’s top producers. Copper inventories at the LME warehouses continue to remain stretched, and with the Chinese New Year now ending, expanding coronavirus vaccinations look set to continue fuelling a faster-than-expected global economic recovery.
Copper prices are on course for a 3rd straight winning session, gaining 1.63% as of the time of writing.
Technical Outlook for Copper Price
The ascent in price this Monday met resistance at the October 2011 high of 4.2015, before sellers stepped in and the price pulled back nearly 50% on the day. An extension of the pullback looks likely as the latest leg-up completes the projected measured move from the bullish pennant of January 2021. This correction could target the 3.9970 support level, with 3.8340 lining up as potential support further south.
On the flip side, bulls need to overcome 4.2015 to bring in 4.2755 into the picture, as the price continues to chase all-time highs on the red metal. This move may be preceded by a correction, followed by dip buying at suitable support areas seen on the chart.
Copper Price; Daily Chart