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Comex copper ends off amid technical selling

NEW YORK: Comex copper futures slumped in listless trading after London prices hit technical resistance and faltered, dealers said.

"London is down-ticking, so people are trading off of that," said one floor source. "Other than that, it has been a very quiet day."

Final estimated volumes for Comex copper reached a mere 8,000 contracts, compared with Friday's official tally of 9,573 lots.

Active May fell 0.70 cent to 80.75 cents a lb, ranging from 80.60 to 81.90, while spot March weakened 0.65 to 79.90 cents.

Back months all settled between 0.60 to 0.75 cents easier.

"I haven't seen any major funds trading," one floor source said. "It looks like arbitrage and locals doing most of it," he added.

New York dealers expected copper to post gains if the three-months price on the London Metal Exchange (LME) retains a firm close above key-level $1,800 a tonne.

"If we get above the 82.10 mark (roughly the Comex equivalent), we could keep this thing on the upside," said one trader.

Chartists pegged near-term support in Comex May copper at 81.05 cents a lb and resistance at 82.70 cents.

Although LME inventories continue declining from record high levels reached Feb 28, market participants were unsure whether copper is primed to break up out of its well-worn range in the near-term.

Sogemin Metals president Richard Hirsch said copper underwent a "technical failure" Monday, having reached its 30-day moving average at the intra-day high of 81.90 cents.

"It fell after reaching that, and I think copper is in a rest period," he said. "But, warehouse stocks fell and oil fell -- both excellent for copper," Hirsch said.

LME copper inventories dropped 4,800 tonnes to 805,200 tonnes on Monday, while Comex stocks were down 108 short tons to 96,450 tons in Friday's report.

Hirsch interpreted the market to be in an intermediate rally since the funds finished liquidating longs, sending copper to three-month lows near 78 cents in early March.

In London, LME three-months copper finished the afternoon kerb at $1,782 a tonne, down $20 from Friday, as resistance at the $1,800 mark repelled copper's attempts to break above its established technical band.

In industry news, London-listed Chilean mining group Antofagasta Plc's Los Pelambres mine in Northern Chile can potentially produce over 300,000 tonnes per year of copper, its President of Mining Operations said.

In other news, Belgian metals producer Union Miniere <ACUMt.BR> said Monday it will raise output at two of its European copper smelters this year.

Production at UM's smelter in Pirdop, Bulgaria will increase to 145,000 tonnes of copper anode in 2000 from 95,000 tonnes in 1999, while refined copper output at Olen in Belgium will rise to 350,000 tonnes from 330,000 tonnes.

Comex is a division of the New York Mercantile Exchange.ÑReuters