Copper futures swung between small gains and losses in rangebound trade on Wednesday, as investors remained cautious ahead of the minutes of the Federal Reserve’s December meeting and the upcoming U.S. jobs report.
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery traded at USD3.360 a pound during European morning trade, little changed on the day. Comex copper prices traded in a range between USD3.355 a pound and USD3.372 a pound.
The March contract ended Tuesday’s session unchanged at USD3.359 a pound. Copper prices were likely to find support at USD3.330 a pound, the low from January 6 and resistance at USD3.387 a pound, the high from January 3.
Investors were turning their attention to the minutes of the Fed’s December meeting, due for release later Wednesday, for indications on the possible timing of further reductions in the central bank’s stimulus program.
Traders were also awaiting the release of the ADP report on private sector job creation later in the day, a key indicator ahead of Friday’s nonfarm payrolls report, for indications of the strength of the recovery in the labor market.
The Fed started to reduce its monthly bond-buying program by USD10 billion this month. Some market participants believe the central bank will likely taper its bond purchases by an additional USD10 billion in each of its next seven meetings before ending the program in December 2014, amid indications of an improving U.S. economy.
The U.S. is second behind China in global copper demand. The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar.
Elsewhere on the Comex, gold for February delivery dipped 0.35% to trade at USD1,225.50 a troy ounce, while silver for March delivery declined 1.3% to trade at USD19.53 a troy ounce.