It was another choppy session on the LME on Tuesday, with Monday’s fall arrested by unexpectedly strong Chinese copper import data. Aluminium bounced around during the morning sessions between 2817 and 2838 on high volume and while an eventual test of support c. 2790 looked the more likely, the afternoon brought a dollar-induced rally. The euro had been firm after eurozone Q1 GDP figures came in stronger than expected, though it was the US core consumer price report that sank the greenback in the pm sessions. While healthy for the US economy in the long term, the inflation indicator reduced the probability of an imminent US interest rate rise, sending the dollar reeling. Having met resistance c. 2835/40 all morning, aluminium broke higher and peaked at 2858 in the pm kerb, though the flurry was short-lived with prices back at 2840 before London dealers went home.
Nearbys, forwards and the LME’s WC warrant banding report were virtually unchanged.
On Thursday morning the market died a death, it seemed, with prices dawdling in the mid-2830s on (for aluminium) diabolical turnover of only 550 lots. While copper traders now assumed that China would be awash with the red metal after April’s imports, aluminium talk was again of growing production with both Vedanta and Chalco this week talking of hikes in output. Technically support remained at 2790 with ‘strong resistance’ due c. 2920, Cliff Green Consultancy maintained.
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