SHANGHAI, May 11 (SMM) – The most active SHFE 1208 copper contract started RMB 200/mt higher at RMB 57,490/mt Thursday, and then fluctuated narrowly around RMB 57,500/mt without a noticeable trend and reaching a low at RMB 57,340/mt. In the afternoon session, as LME copper prices moved higher further after breaking USD 8,100/mt due to the falling US dollar, SHFE 1208 copper contract increased to as high as RMB 57,800/mt, but kept hovering below their moving averages owing to technical resistance and a lack of substantive buying support. Finally, the most active copper contract ended RMB 480/mt or 0.84% higher at RMB 57,770/mt, with trading volumes and positions decreasing by 42,320 lots, and 6,816 lots, respectively. SHFE copper prices exhibited some resilience, but will continue to weaken on account of intersection between the 10- and 20-day moving averages, as well as low market sentiment.

As SHFE copper prices showed strong resilience, hedged copper was restricted. Overall spot copper supply, though, remained stable. Offers for spot copper premiums were between positive RMB 20-100/mt in Shanghai in the morning business. Traded prices for standard-quality copper were between RMB 57,680-57,750/mt, and RMB 57,720-57,820/mt for high-quality copper. Downstream producers continued to buy as needed, while traders only stepped up purchases at the tail of the morning trading session. Hence, overall transaction volumes in the morning were smaller than the previous day levels. In the afternoon, as SHFE copper prices rose, mainstream quotations for spot copper premiums narrowed to positive RMB 0-80/mt, but market transactions were limited since market participants were skeptical about a continuous rebound in copper prices.