Copper is trading at 314 cents per pound, and the metal has been in demand since the HSBC survey of Chinese manufacturing was better than expected, climbing to a seven-month high.
The HSBC and official manufacturing reports have been showing contradictory results for the past few months, but now the survey is showing expansion in the sector. The official report compiled by Beijing is expected on Tuesday 1 July.
As I mentioned previously, the loosening of lending requirements for Chinese banks helped the price of the metal. Now traders have hard proof that manufacturing is expanding in the country which is the largest copper importer in the world.
When copper rallied at the end of May it failed the breach the 319 cents per pound mark. It is currently heading towards the 200-day moving average of 317 cents per pound, with the 310 cents per pound level providing support.