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6 Jan 2015
Copper falls as Oversupply fears resurface
FXStreet (Mumbai) - Copper futures on Comex erased gains and edged lower during the European session, after rebounding briefly from fresh four and a half year lows reached yesterday.
The red metal trades now at USD 2.763/ pound, down -0.12% on the day, rebounding from 4-1/2 year lows of 2.744 hit yesterday. Copper prices extended losses after the Ministry of Finance said China had put in place an export tax rebate of 9 percent for copper bars, rods and profiles at the beginning of 2015, while increasing the export tax rebate for copper foils to 17 percent from 13 percent.
The new export tax rebate introduced by Beijing is expected to increase copper product shipments as much as tenfold. This would in turn contribute to an oversupply of the metal this year.
Copper Technical Levels
Copper prices have an immediate resistance located at 2.78, above which gains could be extended to 2.82 levels. Meanwhile, support is seen at 2.74 levels, below which it can extend losses to 2.72 levels.
The red metal trades now at USD 2.763/ pound, down -0.12% on the day, rebounding from 4-1/2 year lows of 2.744 hit yesterday. Copper prices extended losses after the Ministry of Finance said China had put in place an export tax rebate of 9 percent for copper bars, rods and profiles at the beginning of 2015, while increasing the export tax rebate for copper foils to 17 percent from 13 percent.
The new export tax rebate introduced by Beijing is expected to increase copper product shipments as much as tenfold. This would in turn contribute to an oversupply of the metal this year.
Copper Technical Levels
Copper prices have an immediate resistance located at 2.78, above which gains could be extended to 2.82 levels. Meanwhile, support is seen at 2.74 levels, below which it can extend losses to 2.72 levels.