Copper fell slightly on the kerb after holding steady through most of the session and other metals were mostly firmer in routine Tuesday trade on the London Metal Exchange (LME).
Copper finished the session at $1,661, $4 lower than Monday's afternoon kerb close, and dealers saw it sliding below next support at $1,650 after hitting a pre-market low of $1,635. Chinese market players were building speculative short LME positions, traders in Shanghai said.
LME floor traders noted fairly light Chinese copper sales over the last two weeks and saw this as a further sign that the market was depressed.
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They said it was a further symptom of the Asian economic crisis which was still hitting base metals markets.
The full impact of Asia is finally becoming clear, said a broker, adding that he advised selling any rallies in copper and not going long in any other LME contract.
Support at $1,650 was expected to give way to a quick slide to $1,617, dealers and analysts said. But some warned that profit taking (purchases) could easily swing the market, catching the shorts out.
It's a dangerous game down at these numbers. The funds have probably done most of their selling, and even if we go down to the recent low at $1,617 they could still be squeezed out, said one.
Technically it looks awful, but stock drawdowns could help turn it, he added. LME copper inventories fell by another 750 tonne yesterday.