By Debbie Carlson
The extent of the decline of the base metals’ break was greater than expected, says Ed Meir, analyst at MFGlobal. “It shows how quickly markets can fall when confidence is shaken; gains that have accumulated over months and year are given up in a matter of weeks,” he says.
Meir says further weakness is possible in most base metals, based on technical price charts. Copper could fall to $6,000 a metric ton (currently around $7,262), aluminum could get to $2,100 (currently around $2,200) and is now in territory where most producers are seeing prices below their cost of production, he says.
Zinc's downside target is $1,800 (now around $1,950), while Lead could hit some support at $1,950 (now around $2,020), but beneath that point there is little further support he says.
“Nickel and Tin are getting thrashed, as they typically have less liquidity and this tends to magnify their declines. There is some support for Nickel at $17,000, and below that, at $15,500 (currently at $17,900). We do not see anything on tin until $15,400 (currently at $19,130),” he says.
