-2.54% for Copper as US LME copper inventories surge

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Copper drops 2.54% as supply surges

Highlights

Copper inventories in London Metal Exchange US warehouses have reached their highest in over 12 years, indicating a substantial supply surplus.
Rising domestic stockpiles and anticipation of import tariffs have pressured copper prices, signaling excess available metal relative to demand.
Copper trades below key short- and medium-term moving averages with bearish momentum, targeting a range of $6.3542 to $6.4704 and a high likelihood of further downside.

Inventory surge and tariff anticipation drive downside momentum

Copper inventories in London Metal Exchange warehouses throughout the US have risen to their highest levels in over 12 years, with Brecorder noting a significant accumulation of metal ahead of anticipated import tariffs set for early next year. The buildup of domestic stockpiles has pointed to a pronounced supply glut, exerting pressure on prices as available metal exceeds current demand. Market participants have viewed this rapid inventory growth as a primary factor intensifying short-term downside momentum.

Bearish momentum confirmed as oversold signals and resistance converge

On the H4 timeframe, HG trades below both the MA-20 and MA-50, indicating persistent downward pressure in the short and medium term. The price remains above the long-term MA-200, which provides structural support, while the Ichimoku Kijun at $6.5278 serves as immediate resistance for the session. Momentum signals remain bearish: MACD continues to reflect selling, ADX is neutral with no clear trend strength, and indicators such as RSI at 28.45, Stoch RSI, and CCI point to strong oversold conditions. Bull/Bear Power confirms intraday seller dominance, and the Awesome Oscillator supports the prevailing bearish tone.

Further decline likely as consolidation dominates short-term outlook

Looking ahead, copper is anticipated to trade within a band from $6.3542 to $6.4704 over the next few sessions, reflecting typical volatility for the current market context. Scenario analysis suggests a high probability of further downside extension, while the likelihood of a rapid recovery remains minimal in the short term. Price consolidation within this range is the baseline expectation, with a bullish reversal contingent on a breakout above immediate resistance, and a deeper decline likely if support at the lower boundary fails.

Viktoras Karapetjanc, expert at Traders Union, sees the current copper slide as fundamentally driven by regulatory anticipation and swelling inventories. He notes that supply is outpacing demand, creating downside momentum in the short term but keeping the longer-term structure intact above key supports. The analyst believes the market is positioned for range-bound trading, with a risk of further decline if support fails. Karapetjanc remains positive on copper’s medium-term prospects, provided macro fundamentals stabilize. "While short-term pressure is high, I see any pullback to key support levels as a tactical accumulation opportunity for patient investors."

Earlier, analysts noted that copper was exhibiting persistent near-term weakness while maintaining foundational long-term support. The latest inventory buildup and continued oversold conditions reinforce the prevailing downside scenario, with further declines possible if supply pressures intensify beyond current expectations.

Source of Data: HG Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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