Copper prices slumps 6% intraday after longest winning streak in 8-years. A correction or buying opportunity?

Copper prices witnessed a sharp retracement on Wednesday after a strong rally in recent weeks. On the Multi Commodity Exchange (MCX), copper futures for January 30, 2026 expiry were trading at Rs 1,298.95, down Rs 38.40 or 2.87% intraday.

Earlier in the day, prices fell to a low of Rs 1,261, marking a 5.7% drop from Tuesday’s close.

Despite this pullback, copper has seen an exceptional run through 2025. The metal has notched its longest winning streak since 2017, rising for eight consecutive sessions in December and peaking just below $13,000 per tonne.

Copper settled at $12,558.50 per tonne in the international markets on Tuesday, marking a 2.7% gain for the session and bringing the year-to-date rise in Comex copper futures to over 40%, the sharpest annual increase since 2009.

According to Jigar Trivedi, Senior Research Analyst, Currencies & Commodities at Reliance Securities, supply concerns have been a key driver of the recent surge. Traders have increasingly moved metal into the US in anticipation of potential tariffs, tightening availability in other regions.

In addition, multiple disruptions in major producing countries such as Indonesia, Chile, and the Democratic Republic of the Congo have weighed on global supply. In November, Mercuria Energy Group flagged the possibility of a severe copper shortage worldwide in 2026.
Trivedi also pointed to the role of a weaker US dollar, which has made metals cheaper for buyers using other currencies. The dollar has depreciated by approximately 8% in 2025, lending further support to commodity prices.On the London Metal Exchange (LME), copper breached the $12,600 per tonne mark for the first time this year.

As per Manoj Kumar Jain of Prithvifinmart Commodity Research, 3M LME copper settled at $12,635.55, reflecting a 3.48% gain, with strong support seen at $12,000 and resistance projected at $12,840 to $14,000 per tonne.

He noted that copper prices are showing high volatility and solid strength, rebounding from previous session sell-offs amid supportive macro factors and demand expectations for 2026.

Domestically, Jain highlighted that the MCX copper January futures contract has support at Rs 1,205 to Rs 1,271, while resistance is seen between Rs 1,374 and Rs 1,410.

While copper has cooled off from its recent highs, analysts maintain that the overall market environment continues to be shaped by a “perfect storm” of supply chain stress, an optimistic macroeconomic outlook, and speculative interest, particularly in the context of global industrial recovery.

The outlook for copper remains closely tied to movements in the dollar index, potential policy decisions from the US Federal Reserve, and ongoing geopolitical developments, all of which are expected to influence metal prices in the near term.

Also read: Silver prices crash by Rs 15,000 on last trading day of 2025. What should traders do?

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)