Copper price is on a consolidation pattern after reaching a 10-year high in Thursday’s session. Since mid-March 2020, the red metal has been on an uptrend amid the ongoing push for decarbonization. Over the past 13 months, it has surged by about 124%.
China, the US, and Europe are among the developed regions that have enacted stringent measures to curb carbon emissions in the short and long term. The subsequent popularity of electric vehicles has heightened the demand for copper.
At the same time, copper price is reacting to the ongoing supply concerns. As of Monday, the inventories in warehouses registered with the London Metal Exchange (LME) stood at 155,100 tonnes. This is a drop of over 10% in 10 days. The stockpiles are expected to decline further as the demand soars. Investors are now keen on how President Biden’s infrastructure plan will impact the metal’s prices.
Copper price is consolidating after reaching a 10-year high on Thursday. In the previous session, the red metal rose to $10,008 per tonne at the LME. This is its highest level since February 2011. However, it has since pulled backed to the current $9,880.25. On an hourly chart, it is trading between the lower and middle Bollinger bands.
While the outlook remains bullish, it is likely to find resistance at $9,900 in the near term before gathering enough momentum to move higher. Above that level, the next target will be $10,100. However, this thesis will be invalid if copper price falls below the support level of $9,794. If that happens, the level to watch out for is $9,721.
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