Copper continues to trade in a bullish trend and has broken an important local level of $2.71 for the second time. It first happened last Thursday, however, the breakout was local and buyers failed to gain a foothold. Over the previous month, the price was moving within the expanding triangle, and at the moment bulls are breaking its upper limit. Most likely, they will meet resistance in the $2.76-2.78 zone. A breakout of this area will open the way for the asset to move up to $2.84 and higher.
According to the data released by World Bureau of Metal Statistics (WBMS), the copper market recorded a surplus of 43 thousand tonnes in January-April of 2019, compared with a deficit of 19 thousand tons for the whole 2018.
One of the main factors that supports the copper price is the ongoing strike at the Chuquicamata mine, which production decreases by 500 tonnes per day. Lost production amounts to 3500 tonnes of copper. On Saturday, the labor unions rejected the latest Codelco’s labor contract. Chuquicamata produces about 320 thousand tonnes of copper per year, which is 1.5% of the world total. The metal price is also pushed up by the trade war between the USA and China and the production decline in the PRC.