* Investors bet Washington to clinch deal to avert cliff
* US copper speculators raise net longs to highest since Aug 2011
* LME copper may fall to $7,757 - technicals
By Maytaal Angel
LONDON, Dec 24 (Reuters) - Copper was steady on Monday, after posting its
biggest weekly drop in more than six months, as the Christmas holiday lull set
in across markets and uncertainty about the U.S. fiscal talks kept prices
trapped in a tight range.
Negotiations to avert $600 billion worth of tax hikes and spending cuts due
to take effect in the new year have dragged on, with some U.S. lawmakers voicing
concerns on Sunday that the country would go over the "fiscal cliff" in nine
days.
But risk assets mostly held steady on the last trading week of the year as
most global investors bet Washington would reach an agreement to prevent the
world's top economy from slipping into another recession.
Three-month copper on the London Metal Exchange CMCU3 dipped 0.06 percent
to $7,826 a tonne by 1016 GMT, after losing nearly 3 percent in the previous
week - its steepest weekly drop since early June.
"A majority of people anticipate a deal will be done, even if bit after the
deadline. (Also) macro data has looked more constructive of late. In that
environment, there's a little more optimism about the outlook (for metals) in
the coming months," Macquarie analyst Duncan Hobbs said.
Looking further ahead, however, Hobbs warned: "Copper continues to trade at
high prices by historic standards at a time where people expect the
(supply-demand) balance will ease over the next few years."
Speculators raised their net length in U.S. copper to 24,531 contracts in
the week ended Dec. 18, the highest since August 2011, data from the U.S.
Commodity Futures Trading Commission showed.
The dollar was down slightly against the euro but up strongly from last
week's eight-month lows as a lack of progress in U.S. budget talks led investors
to the perceived safe haven of the greenback. A strong dollar makes
dollar-priced metals pricier for non-U.S. investors.
"Monday will likely be quiet as it's a shortened trading day, but we think
there will be some fireworks in the run-up to year-end, particularly as the
situation around the cliff evolves," RBC Capital Markets said in a note.
In industry news, Chilean miner Antofagasta has halted development
at its $1.7 billion copper mine Antucoya as it reviews escalating costs of the
project. Peru meanwhile plans to nearly double its copper output in the next two
years and will not give up on a $5 billion project by Newmont Mining,
which has stalled due to community opposition.
Technical analysis suggested that LME copper could fall to $7,757 during the
day as a weak rebound from last Thursday's low of $7,735 seems to have ended,
Reuters market analyst Wang Tao said.
In other metals, soldering metal tin fell 0.32 percent to $23,150 a
tonne, while zinc, used in galvanizing, rose 0.29 percent to $2,088 a
tonne.
Battery material lead dipped 0.08 percent to $2,304.25, aluminium
rose 0.44 percent to $2,092.50, while stainless-steel ingredient nickel
dropped 0.65 percent to $17,237.
Metal Prices at 1034 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2011 Ytd Pct
move
COMEX Cu 354.55 -1.05 -0.30 344.75 2.84
LME Alum 2092.00 10.00 +0.48 2020.00 3.56
LME Cu 7822.50 -9.00 -0.11 7600.00 2.93
LME Lead 2302.00 -5.00 -0.22 2034.00 13.18
LME Nickel 17184.00 -166.00 -0.96 18650.00 -7.86
LME Tin 23100.00 -125.00 -0.54 19200.00 20.31
LME Zinc 2087.25 16.25 +0.78 1845.00 13.13
SHFE Alu 15280.00 20.00 +0.13 15845.00 -3.57
SHFE Cu* 56850.00 110.00 +0.19 55360.00 2.69
SHFE Zin 15490.00 105.00 +0.68 14795.00 4.70
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07
