SHANGHAI, May 23 (SMM) – The most active SHFE 1209 copper contract opened RMB 190/mt higher at RMB 56,070/mt Tuesday. After the opening, as LME copper met resistance at USD 7,800/mt, SHFE 1209 copper contract suffered selling pressures from shorts at RMB 56,000/mt, slid after touching briefly at RMB 56,100/mt, but gained support after retreating to as low as RMB 55,800/mt. In the afternoon, Chinese stock markets increased by more than 1%, helping SHFE copper prices stop falling but still come under pressure at RMB 56,000/mt. Finally, SHFE 1209 copper contract closed RMB 30/mt or 0.05% down at RMB 55,850/mt, with trading volumes decreasing by 71,124 lots but positions adding by 15,838 lots. Longs and shorts held increasing divergence at RMB 56,000/mt, and shorts exerted selling pressures again after leaving markets for one trading day. Coupled with prominent resistance at the 10-day moving average, SHFE copper prices still face downside risks.
SHFE copper prices met resistance to rebound, and selling pressures for forward copper contracts increased. Cargo-holders in spot copper markets became more willing to move goods, allowing copper supply to remain stable. Spot copper premiums were quoted between positive RMB 200-260/mt in Shanghai in the morning business. Traded prices for standard-quality copper were between RMB 56,650-56,750/mt, and RMB 56,700-56,830/mt for high-quality copper. Both downstream producers and traders opted to stand on the sidelines, resulting in a drop in market transactions in the morning. In the afternoon, SHFE copper prices stopped sliding, but spot copper premiums held onto the morning business levels. Traded prices were also little changed from the morning session levels, while overall market activity was modest.