On Friday, copper futures price increased amid a weaker greenback, high demand in top importer China, and supply woes in the world’s largest producer Chile.
The price of copper contract for December distribution jumped by 2.15% to $3.60 per troy ounce over the past 24 hours on September 09, climbing further by 2.11% in the Asian afternoon session.
The red metal’s bullish movement is buoyed by potential production disruptions that raised concerns of supply shortage.
Earlier this week, workers from Chile’s Escondida threatened to go on strike over safety concerns. This company is the largest copper mine in the world.
Meanwhile, Chinese customs showed that the country imported 26.00% more copper in August compared to the year-ago period, supporting the base metal’s price due to high demand in the top importer nation despite renewed coronavirus lockdowns.
In addition, an energy research entity projected that the red metal’s demand would continue to spike by more than 50.00% between 2022 and 2040.
This forecast is supported by clean energy transition activities that are gauged to rise by roughly 4.00% per year between the recently discussed time period.
Over the same time frame, copper demand is anticipated to jump by 1.50% from traditional sources such as construction and manufacturing of heating and cooling equipment.
Technical Analysis
On the technical side, the red metal is traversing the support level of $3.55 and the resistance zone of $3.62 within the day.
Based on the hourly chart, copper’s Relative Strength Index (RSI) is over the 63 level at 63.61, imposing a buy position.
Besides, the base metal’s Classic, Fibonacci, and Camarilla pivot point is at $3.60.
Also, the Fib Retracement is on the intraday low of $3.59 and swing high of $3.61.
On the moving averages, its 100-SMA and EMA are sitting at $3.49 and $3.50, respectively.
