By Glenys Sim Oct. 8 (Bloomberg) -- Copper pared losses in Asia as some investors bought the industrial metal following its slump to a 20-month low earlier. Zinc, lead and nickel also gained. The metal's 14-day relative strength index, used by some traders and investors to gauge changes in price direction, showed the declines have been overdone and prices may rebound. The index has stayed below 30 since Oct. 1, a reading that signals the commodity may be poised to rise. ``There's nothing surprising about a slight bounce after the declines we've seen in the past two weeks,'' Wang Zheng, a trader at Everbright Futures Co., said from Shanghai today. ``As long as fears of a global economic slowdown remain, we're going to see pressure on metals.'' Copper on the London Metal Exchange gained as much as 0.9 percent to $5,681 a metric ton and stood little changed at $5,621 at 10:50 a.m. Singapore time. The metal used in wires and pipes dropped 4.4 percent to $5,380 earlier, the lowest intra-day level since February 8, 2007. Copper in Shanghai today plunged by the exchange-imposed daily limit for a third day. The metal for December delivery on the Shanghai Futures Exchange dropped by 2,920 yuan, or 6 percent, from the previous settlement price, to 45,720 yuan ($6,713) a ton when the exchange opened for trading at 9 a.m. local time. ``Base metals could be choppy to weaker, with mild relief rallies met by weak sentiment,'' Mark Pervan, Australia & New Zealand Banking Group Ltd.'s head of commodity research wrote in an e-mail today. Price Downgrades Analysts are cutting price forecasts on commodities from metals to grains as the credit crisis deepens, raising concerns of a slowdown in the global economy, curbing demand for raw materials. Commodities last week capped their biggest weekly decline in more than 50 years. ``Heightened nervousness in global equity markets will put the base metals on the back foot, as will increased broker downgrades to near term price forecasts,'' said Pervan. Pervan cut copper estimates by 21 percent for 2009, and 2010 and Commerzbank AG reduced its 2009 estimate 11 percent yesterday. Barclays Capital, Morgan Stanley and UBS AG lowered industrial- metal estimates in the past two weeks. A rising U.S. dollar will also discourage buying, said Pervan. The dollar index, a weighted measure against six major currencies including the euro, yen and pound, has risen 2.1 percent since the start of the month. Among other LME-traded metals, zinc was up 2.3 percent at $1,585, lead gained 0.6 percent to $1,640, and nickel added 1.4 percent to $14,400 as of 10:51 a.m. in Singapore. Aluminum slipped 0.7 percent to $2,278 a ton, and tin was 0.9 percent lower at $16,050. To contact the reporter for this story: Glenys Sim in Singapore at gsim4@bloomberg.net

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