Copper trades down after large copper inventory build on US COMEX

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Copper drops 1.03% to $6.487 today

Highlights

Refined copper cathodes were exempted from a 50% US import tariff effective July 30, 2025, reshaping international copper trade flows.
US COMEX copper inventories have surged since February 2025 as traders positioned for the administration's Section 232 investigation and expected tariffs.
Copper trades below major short- and medium-term moving averages with a forecast range of $6.3745 to $6.5995 and high probability of continued downside.

US tariff exemption drives COMEX stockpiling and sentiment shift

Refined copper cathodes were excluded from a 50% US import tariff announced on July 30, 2025, significantly altering international trade patterns and resulting in notable stockpiling of copper within the US. This regulatory decision is linked to a large increase in copper inventories on the US COMEX exchange since February 2025, as market participants responded to the US administration's Section 232 investigation and the anticipated impact of tariffs, according to Mining. The resulting buildup of domestic copper supply continues to shape market sentiment, with elevated inventories acting as a key factor influencing Copper futures.

Technical oversold signals as momentum turns mixed below key resistances

On the H4 chart, the price of HG remains below both the MA-20 at $6.615 and the MA-50 at $6.5552, while still trading above the daily MA-200 at $6.32. The Ichimoku Kijun level at $6.6024 serves as immediate resistance. Among key indicators, the MACD stands neutral, whereas ADX signals a Sell, highlighting stronger downward momentum. The RSI is low at 33.51, with both Stoch RSI and CCI deeply oversold, suggesting the market is overdue for a technical bounce. Bull/Bear Power reinforces short-term seller dominance but the Awesome Oscillator remains neutral, indicating mixed momentum signals and potential for volatility.

Further downside likely unless resistance is decisively overcome

In the short term, copper is likely to consolidate within a range of $6.3745 to $6.5995, which sets a typical volatility band relative to current levels. The probability for an immediate rebound is low and further downside is considered highly probable unless the price can decisively clear initial resistance at the Ichimoku Kijun. Should support at $6.3745 fail, additional losses may follow. Conversely, a break above $6.6024 could signal the start of a technical recovery, though this scenario appears less likely in the current environment.

Viktoras Karapetjanc, expert at Traders Union, sees copper’s downside move as a function of both regulatory change and shifting domestic supply. The US exclusion of refined copper cathodes from tariffs has encouraged inventory builds, tilting fundamental sentiment toward oversupply. Technically, seller momentum dominates, with resistance at $6.6024 capping upside prospects for now. Karapetjanc believes a rebound is possible only with a firm break above resistance. "For now, I see copper consolidating near support, but any renewed demand or policy change could trigger a fast recovery above $6.6024."

Previously it was reported that Rio Tinto resumed underground activity at the Oyu Tolgoi copper mine in Mongolia following a temporary halt tied to safety concerns. The current article adds that heightened US copper inventories and recent regulatory shifts are key pressures for the market, making the $6.3745 support level critical for traders monitoring near-term downside risk.

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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