DJ MARKET TALK: NY Copper Hits Year's Highpoint, Can't Breach $3
Copper futures have extended their high for the year,
but remain capped by $3 resistance. A smaller-than-expected increase in third
quarter home building and a decline in the producer price index for finished
goods are weighing on copper, says Sterling Smith, commodity trading advisor
and analyst with Country Hedging. But news that Caterpillar Inc. (CAT) exceeded
third-quarter profit expectations by a wide margin as the company slashed its
costs in response to continued falling sales of construction machinery is
supporting copper, Smith said. "We kind of have a little bit of a tug of war
here," he said. Dec copper made it as high as $2.9990 -- the contract's
strongest point for the year -- but again failed to push through the $3 level.
"It's well-defined resistance," Smith says. Comex Dec copper is up 0.35 cent at
$2.9700 a pound. Larry Young, senior trader with Infinity Futures, says early
profit-taking was overcome by some carry-over buying from Monday's rally as
participants thought the reports presented reasonable numbers.
