Copper could rebound to $7.500 $7.700 per metric ton within the next a week or two said R.J. O Brien Associates in a snippet. According to the firm a key will be Chinese buying interest after the recent price decline. "Some Chinese traders were beginning to nibble when the market got to the $7.500 $7.700 area but then they stood back in anticipation of lower prices." In New York COMEX copper fell for the fourth straight day on Monday unable to sustain an early bounce from a seven month low as mounting fears over the global economy continued to darken the demand outlook for industrial metals.
Conditions were thin and choppy with the London Metal Exchange (LME) closed for the Diamond Jubilee holiday on Monday and Tuesday. LME Copper sank to its lowest level ($7.301 a ton) this year on Friday as investors worried about the outlook for the global economy after the United States gained the smallest number of jobs in a year adding to pessimistic data out of China and Europe. They continued that copper may be close to a bottom. "This is particularly so as the market has seen very heavy short selling over the last two weeks and a short covering rally is probably overdue."
"One catalyst for this short covering rally could be a rapidly growing belief in markets that a fresh QE (quantitative easing) program will be announced by the Fed following the very disappointing employment figures released last Friday they added. Another could be a belief that European leaders were about to get their act together. And still another catalyst could be moves by Beijing to do a bit more to stimulate the economy " R.J. O Brien concluded.
