Copper price analysis: The rally pauses and the market awaits more value opportunities
2025-07-28 17:28:18
During the European session on Monday (July 28), the price of refined copper in the United States was reported at $5.7810 per pound, which was the same as the opening price. The price of copper fluctuated greatly during the day, and it fell after opening high, showing an overall volatile downward trend.
The copper market has recently presented a complex pattern of "strong reality and weak expectations", driven by multiple factors including China's peak season demand, US tariff policy and the global macroeconomy.
According to data from Shanghai Nonferrous Network (SMM) and China's General Administration of Customs, as of July 25, 2025, copper inventories at the Shanghai Futures Exchange (SHFE) fell 13% to 73,423 tons, the lowest level since December 2024, while refined copper imports in June surged 15% month-on-month, reflecting strong peak season demand in China's downstream industries such as power and construction, providing short-term support for SHFE copper prices.
The United States plans to impose a 50% tariff on imported copper from August 1, pushing up COMEX copper prices and causing the spread between COMEX and LME copper to a historic high of over $1,200 per ton. Bloomberg pointed out that traders are diverting copper sources from Asia to the United States, which may increase the pressure on destocking in the Chinese market in the short term, but high tariffs may suppress downstream demand in the United States.
On the global supply side, risks of labor disputes and environmental protests remain in copper-producing countries such as Chile and Peru, but supply tensions have eased slightly.
At the macro level, the return of the US PMI to the expansion range provided support for copper prices, but the European economic slowdown and geopolitical uncertainties limited the upside.
Copper prices may fluctuate strongly in the short term, and SHFE copper prices are expected to break through 78,000 yuan/ton. Investors are advised to pay close attention to China's inventory data, US policy trends and the pace of the Fed's interest rate hikes.
Technical analysis: Pause for consolidation, target at $6
Last week's trading days were generally calm. A shooting star pattern appeared on Thursday and another shooting star formed on Wednesday, and there was a certain degree of hesitation in the market.
The $6 mark above is an important psychological round number. This area will be closely watched by many investors. Of course, copper prices are extremely sensitive to inflation and economic growth trends. Currently, the economic situation in the United States and other countries is showing relevant effects, which should continue to put upward pressure on copper prices.
The market is still in a continuous upward squeeze. It is worth noting that the current market is already in a clear overbought state. A correction may occur in the short term. A drop in copper prices to $5.50 would be an attractive buying point.
(Source of US copper daily chart: Yihuitong)
If copper breaks below $5.50, the $5.25 level is also worth watching. Not only is this a previous resistance level, but the 50-day exponential moving average (EMA) is also approaching this area.
In either case, it is not suitable to short the copper market at this time. The trend of copper prices often shows obvious range characteristics, and each fluctuation range is usually in units of $1.
The current market is in the stage of waiting for more value opportunities. However, to be honest, it is not impossible for copper prices to rise directly. Judging from the measured increase, once the $6 mark is broken, copper prices are expected to rise further to about $6.50.
At 17:14 Beijing time, US refined copper was quoted at US$5.79 per pound, up 0.09%.
The copper market has recently presented a complex pattern of "strong reality and weak expectations", driven by multiple factors including China's peak season demand, US tariff policy and the global macroeconomy.
According to data from Shanghai Nonferrous Network (SMM) and China's General Administration of Customs, as of July 25, 2025, copper inventories at the Shanghai Futures Exchange (SHFE) fell 13% to 73,423 tons, the lowest level since December 2024, while refined copper imports in June surged 15% month-on-month, reflecting strong peak season demand in China's downstream industries such as power and construction, providing short-term support for SHFE copper prices.
The United States plans to impose a 50% tariff on imported copper from August 1, pushing up COMEX copper prices and causing the spread between COMEX and LME copper to a historic high of over $1,200 per ton. Bloomberg pointed out that traders are diverting copper sources from Asia to the United States, which may increase the pressure on destocking in the Chinese market in the short term, but high tariffs may suppress downstream demand in the United States.
On the global supply side, risks of labor disputes and environmental protests remain in copper-producing countries such as Chile and Peru, but supply tensions have eased slightly.
At the macro level, the return of the US PMI to the expansion range provided support for copper prices, but the European economic slowdown and geopolitical uncertainties limited the upside.
Copper prices may fluctuate strongly in the short term, and SHFE copper prices are expected to break through 78,000 yuan/ton. Investors are advised to pay close attention to China's inventory data, US policy trends and the pace of the Fed's interest rate hikes.
Technical analysis: Pause for consolidation, target at $6
Last week's trading days were generally calm. A shooting star pattern appeared on Thursday and another shooting star formed on Wednesday, and there was a certain degree of hesitation in the market.
The $6 mark above is an important psychological round number. This area will be closely watched by many investors. Of course, copper prices are extremely sensitive to inflation and economic growth trends. Currently, the economic situation in the United States and other countries is showing relevant effects, which should continue to put upward pressure on copper prices.
The market is still in a continuous upward squeeze. It is worth noting that the current market is already in a clear overbought state. A correction may occur in the short term. A drop in copper prices to $5.50 would be an attractive buying point.
(Source of US copper daily chart: Yihuitong)
If copper breaks below $5.50, the $5.25 level is also worth watching. Not only is this a previous resistance level, but the 50-day exponential moving average (EMA) is also approaching this area.
In either case, it is not suitable to short the copper market at this time. The trend of copper prices often shows obvious range characteristics, and each fluctuation range is usually in units of $1.
The current market is in the stage of waiting for more value opportunities. However, to be honest, it is not impossible for copper prices to rise directly. Judging from the measured increase, once the $6 mark is broken, copper prices are expected to rise further to about $6.50.
At 17:14 Beijing time, US refined copper was quoted at US$5.79 per pound, up 0.09%.
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
