Why did copper fall?
On February 24, LME 3M Copper remained almost unchanged. It fell 0.06% to $4,642 per metric tonne. Copper fell as low as $4,580 per metric tonne. However, it recovered and closed above $4,600 per metric tonne. As we discussed in the last part, the concerns about China’s economic health resulted in weakness in copper prices on February 24. In COMEX, copper fell 0.38% on February 24. Copper rose to a two-week high on February 22. It started the week on a positive note. It wasn’t able to carry the same positive momentum because of the weak sentiment surrounding copper. Copper producers Freeport-McMoRan (FCX), Glencore (GLNCY), and BHP Billiton (BHP) fell 0.55%, 7.8%, and 5.4% on February 24.
Aluminum broke the consolidation zone
LME 3M Aluminum rose 1.2% on February 24. It ended the day at $1,567 per metric tonne. After consolidating between the lean range of $1,430–$1,550 per metric tonne for almost four months, aluminum broke the upper level of the consolidation zone on the first trading day this week. On February 24, even though it drifted to a low of $1,538.50 per metric tonne, aluminum managed to close above the resistance level of $1,550 per metric tonne. The recent bullish news for aluminum includes the Chinese export data. China’s aluminum exports for January fell 12%—compared to January 2015. Alcoa (AA) is one of the largest aluminum producers. It gained 2.7% on February 24.
Nickel stayed above the support level
Nickel in the LME (London Metal Exchange) fell for the second consecutive day to $8,520 per metric tonne—a fall of 1.1%. On February 24, nickel fell to $8,470 per metric tonne. However, it managed to close above the support level of $8,500 per metric tonne. LME 3M Zinc rose 1.04% on February 24. It ended the day at $1,755 per metric tonne. The recent closure of mines like Lisheen in Ireland and Century in Austria resulted in reduced supply. This is a good sign for zinc prices. In addition to this, China’s refined imports of zinc witnessed a surge of 150% in January. This is a bullish factor.
Lead fell for third consecutive trading day to $1,690.5 per metric tonne—a fall of 1.14%. Tin in the LME fell 0.16% to $16,000 per metric tonne on February 24. The Power-Shares DB Base Metals Fund (DBB) and the SPDR S&P Metals & Mining ETF (XME) rose by 2% and 0.57% on February 24.