Base metals traded mixed during the previous week with most of the metals trading under pressure of selling industrial metals in China. Copper prices kept downslide limited on supportive fundamentals while nickel, zinc and lead prices ended the week in red, according to Tapan Patel, senior analyst (commodities) at HDFC Securities.
Base metals traded after a fall in Chinese iron ore prices — the looming fear of tighter monetary policy in China persisting. There were also some demand growth concerns after poor China construction PMI and rising inventories of steel and iron ore. China’s stricter actions for emission controls has also led to some production curbs.
Copper contract on the LME remained firm on supply concerns over Chile’s potential labour strike. The overall supply deficit concerns have lifted copper prices along with demand growth optimism from US.
HDFC Securities expects base metals to trade sideways to down for the week with MCX Copper support at Rs670 and resistance at Rs689. MCX nickel support lies at Rs1,140 and resistance at Rs1,190 for short term. Zinc and aluminium may limit downside with support at Rs212 and Rs167, respectively.