The point I was making was China was buying and now they are selling, hence the build on LME inventory.
from ***** this am;
Chinese funds helped drive a rout on copper markets last month that sent prices spiralling down to the lowest levels in 5-1/2 years amid worries about a slowing Chinese economy and surging copper inventories
METALS-Copper rebounds as Chinese sellers go on holiday
Wed Feb 18, 2015 10:20am EST
*
China markets closed for week-long holiday
* Indonesia may delay 2017 ban on copper ore exports (Recasts, updates prices)
By Harpreet Bhal and
Eric Onstad
LONDON, Feb 18 (Reuters) - Copper rebounded on Wednesday after hefty falls in the previous session as some bulls took advantage of Chinese investors being absent due to the week-long Lunar New Year
holiday
.
.
"Yesterday the selling was coming from the Far East, but they're not around at the moment. The price was ramped up through resistance, and that set off stop-loss buying," a trader said.
Three-month copper on the London Metal Exchange (LME) had shot up 2.2 percent to $5,775 a tonne by 1505 GMT after falling 1.7 percent in the previous session -- its biggest one-day fall in three weeks.
Copper prices have recovered around 8 percent since hitting the 5-1/2 year low in January, but the metal used in power and construction has still fallen some 9 percent so far this year.
Copper has been stuck in a $5,300-$5,800 trading band for the past month, and traders expect little to change until post-holiday trade revives in China. Markets in China will reopen on Feb. 25.
"Prices sold off yesterday and are still recovering," said Daniel Briesemann, an analyst at Commerzbank.
"Liquidity is very low due to the Chinese players being absent. It will be this way until the Chinese customers come back into the market."
Broker Marex Spectron said its Copper Sentiment Index, derived from a proprietary algorithm and data from the three major copper exchanges, showed a reading of -90.0, indicating sentiment remains extremely depressed but has moved off a recent low of -95.7, the exact same level as the sentiment low in 2008.
"With the level of speculative shorts having reached such an extreme recently, it is likely that a major deterioration in the global
economy is needed for copper to make material new lows this year," Guy Wolf, Global Head of Market Analytics at Marex Spectron said.
Also supporting metals markets was optimism over Greece. Share markets stormed to multi-year highs as investors bet a deal over Greece's debt will be reached by the end of the week.
In industry news, Indonesia could push back a ban on exports of mineral concentrates that is due to come into effect in January 2017 if miners have not built new domestic smelters, a mining ministry official said.
