SHANGHAI, Jan. 5 (SMM) – 52% Chinese investors see LME copper to hover between USD 4,600-4,730/mt this week and SHFE 1603 copper to range RMB 35,800-36,600/mt.
Sufficient liquid early 2016 will allow both longs and shorts to enter market.Only the reverse repo worth of RMB 10 billion will be due this week and no purchase will fall due this week. Besides, some producers believed that longs will enter market for SHFE 1603 copper after slump in copper prices on Monday. Positions remain above 770,000 on SHFE market with fierce competitions among shorts and longs. Also, SMM survey reveals that most cable & wire producers see copper prices to stabilize this week. Little upside room is in sight for copper prices and in China’s spot market, investors sold hedged goods for profits at the end of 2015 and traders will likely rush to sellv this week, widening spot discounts.
See SMM Forecast, Please Click: LME Copper to Rise Further Next Week
36% of respondents are bearish towards copper prices and they expect LME copper to fall below USD 4,600/mt this week and SHFE 1603 copper to slip below RMB 35,500/mt. Copper prices plunged on Monday after a 7% slump triggered circuit breaker in Chinese stock market, triggering bearishness in market. US dollar slipped to the 60-day moving average and this week will witness US ADP employment data and non-farm payrolls, which should be upbeat. This will support dollar later the week, weighing down copper prices. Besides, technical indicators indicate downside track for copper prices. In China’s spot market, spot discounts narrowed slightly on the first trading day of 2016 and spot copper suffer sell-off pressure. Overall trading is left muted, boding ill for copper prices.
The rest 12% market players see LME copper to grow to USD 4,635/mt this week and SHFE 1603 copper to break above RMB 36,800/mt. Copper prices will enter upside track with shorts exiting market or longs entering market after a week’s plunge. Heading into 2016, copper smelters and traders suffer no liquid pressure and are unwilling to widen spot discounts, support copper prices.