MUMBAI, Jan 7 (Reuters) - India copper futures, which struck a contract high in the previous session, edged lower on Thursday weighed by a strong rupee and after China's central bank signalled tighter liquidity, analysts said. The most-traded February copper contract MCCG0 was 0.82 percent lower at 348.70 rupees per kg at 3:40 p.m., after hitting a contract high of 354.20 rupees in the last session. The Indian rupee extended its rally soaring to new 15-month highs backed by large dollar sales by foreign banks, but buying of the U.S. unit by importers and a weak sharemarket prevented a sharper rise. [INR/] A strong rupee makes the dollar-quoted asset cheaper. The People's Bank of China unexpectedly raised auction yields of its three-month bills for the first time since mid-August, seen as a significant step-up in liquidity tightening. [ID:nTOE60503R] Ample liquidity, together with buying by China, the world's largest consumer, had helped spur overseas copper's stellar 140-percent rise in 2009. "It (copper) is going to range-bound with a negative bias, 344 could act as a crucial support," said Praveen Singh, an analyst with Sharekhan Commodities. Analysts said traders would await U.S. non-farm payroll data for direction in the base metals complex. See [ID:nN04238910] "Copper may drop till 345/346 by evening and remain there," said Amrut Deshmukh, senior analyst with Way 2 Wealth Securities. In other base metals, January zinc MZIF0 was 0.74 percent lower 121.25 rupees per kg, while lead for January delivery MLDF0 was 0.91 percent lower at 119.40 rupees per kg. said Deshmukh. Selling could be initiated at 119, with a target of 117, and with a stop loss of 119.8 rupees, said Deshmukh. (Reporting by Siddesh Mayenkar; Editing by Prem Udayabhanu)

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