Copper resumes its slide as speculators liquidate

LONDON, Jan 17 (Reuters) – Copper resumed its decline on Wednesday as some speculators took profits from a December rally and others went short after prices broke below technical levels.  Copper surged 12 percent in a rally during December and has since eased back about 3 percent. „That was a pretty rapid rise in December and we seemed to have traded ahead of the fundamentals, so there was always the risk of profit taking given the net speculative positioning was elevated,“ Robin Bhar, head of metals research at Societe Generale in London, said. Bhar added that once prices broke technical support levels it triggered more selling but he said he viewed any further falls as a buying opportunity. There is uncertainty about supply in the market due to Chinese import restrictions on copper scrap and labour contract talks at several mines, including the giant Escondida mine, Bhar said. Benchmark copper on the London Metal Exchange was down 0.6 percent at $7,034 a tonne by 1500 GMT, after a fall of 1.8 percent on Tuesday. * POSITIONS: Futures brokerage Gelin Dahua has cut its long position on the Shanghai Futures Exchange (ShFE) April copper contract by 75 percent over the past two days, according to Reuters calculations based on ShFE data. * LME ALUMINIUM: Three month LME aluminium was unchanged at $2,189 per tonne. * SHANGHAI ALUMINIUM: The most-traded March contract on the ShFE closed down 1.8 percent at its lowest finish since Dec. 19 as improving weather conditions smoothed the flow of ingots from China’s remote northwestern Xinjiang region to the east of the country. * FERROUS: Steel-linked zinc and nickel were pressured after Chinese iron ore futures fell for a fifth day running to 2-1/2 week lows, pressured by slow demand in the world’s biggest consuming nation amid ongoing curbs on steel production in a campaign against smog. * NICKEL/ZINC: LME nickel , mainly used in stainless steel, dropped 1 percent to $12,420 a tonne, while galvanising metal zinc declined 0.9 percent at $3,373. * ZINC POSITIONING: Zinc had the largest speculative net long position on the LME with 18.5 percent of open interest as of Friday, based on Marex Spectron estimates, the broker said in a note. *PRICES: Lead fell 0.8 percent to $2,533 while tin added 0.1 percent to $20,485.