Copper prices continue to correct lower on Wednesday, May 19, after retracing to all-time highs earlier this month. Copper is currently trading at $10,158/t, off its peak at $10,776.23. That means that the correction has not pushed prices down too far as yet.
Given that the dollar remains weak, thus giving metal prices the chance to move higher, copper still offers plenty of upside potential. However, the conflicting Chinese data that was recently released, limits the likelihood of another bull run.
Conversely, the technical picture does not rule out the possibility of copper declining to $10,000/t, from where a new round of buying could get under way with stop losses at $10,240/10,250 and $10,500/10,600.
In terms of fundamentals, copper still looks pretty good: BHP’s Chilean mines could still go on strike, while the entire industry may be subject to tightening when the state’s new constitution is adopted.