Copper added more than 3% since the beginning of the week and returned to a key level of $2.71. The asset was bought off from a strong daily support level of $2.62. Quotes has been traded in this area since the end of May, consolidating in an expanding triangle. Bullish sentiment is growing and breaking through $2.71 might be a turning point. If this happens, the next obstacle for customers is awaiting in the $2.76-2.78 zone. But in more realistic scenario, cost of the metal will decrease from current values to $2.66 in the short term.
The fundamental reason for the rise to a 3-week high on Tuesday was the statement made by US President Donald Trump. The US-China negotiations would resume again before the G20 summit. Experts believe that the metals market has recently been oversold, and positive news from the front of the trade war could have stimulated traders, but they still retain fears due to demand.
Copper also received support from the disruption of metal supplies from Chile (the Chuquicamata plant) and due to the shutdown of the Glencore plant in Zambia. Argonaut Securities believes that copper prices are unlikely to rise significantly, despite optimism about US-China relations and other positive factors. The demand for copper in China is small, and investment in the country's energy sector only grew by 0.8% during the year. Analysts predict a side trend for copper until there are clear signs of a recovery in demand from the PRC.