Domestic copper prices experienced a notable decline on Tuesday, falling nearly one percentage point to hit the day's low of ₹1,288.90 per kg. The weakness came amid mixed global trends as traders searched for fresh catalysts to guide their next moves in the base metal market.

Market Performance and Global Trends

January copper contracts were trading at ₹1,292.10 on the MCX around 3 pm, registering a decline of ₹10.00 from previous levels. The domestic weakness contrasted with strength in international markets, where COMEX prices traded higher at $5.8545, gaining 0.40%. However, three-month copper contracts on the London Metal Exchange (LME) showed mixed signals, trading at $12,855 per metric ton with a decline of over 1%.

Stellar 2025 Performance Loses Steam

Copper emerged as the standout performer among base metals in 2025, delivering exceptional returns across major exchanges. The metal gained more than 41% in London and 33% in Shanghai during a record-setting rally. On the MCX, copper's performance was even more impressive, surging 62% in 2025. However, this remarkable momentum appears to have stalled, with the metal remaining flat in 2026 to date.

Ajit Mishra, Senior Vice President, Research at Religare Broking, commented on the current market dynamics, noting that the red metal is experiencing increased volatility as profit booking intensifies following sharp price spikes. "The base metal has witnessed a correction in the last two weeks but has found buyers at every support level. The copper market in January 2026 is characterised by extreme volatility following all-time highs," Mishra explained.

Fundamental Drivers Remain Intact

Despite the recent volatility, market analysts emphasize that the underlying fundamentals supporting copper's bullish outlook remain unchanged. The upside movement has been primarily driven by structural supply deficits, combined with significant improvement in demand from artificial intelligence and green energy sectors. Mishra maintained a positive outlook for the remaining days of the month, stressing that these fundamental factors continue to provide support.

Technical Analysis and Trading Outlook

From a technical perspective, copper prices have shown a noticeable rise from late 2025 into early 2026, though recent weeks have witnessed a pullback without disturbing the medium to long-term trend. Technical analysis reveals strong support levels positioned between ₹1,230 to ₹1,250, with deeper corrective moves potentially finding a floor near ₹1,180.

Trading Strategy and Recommendations

Copper's rebound from the low of ₹1,231.30 pushed prices above the ₹1,300 mark, with the base metal currently trading close to this level. Market experts recommend that traders wait for moderate corrections and, subject to stability above the ₹1,290 to ₹1,295 region, consider resuming long positions. The suggested trading parameters include a stop loss below ₹1,270 and targets of ₹1,330 to ₹1,340, though these recommendations apply specifically to the January series expiry.

The current market scenario presents a critical juncture for copper, as traders assess whether the flat performance in 2026 represents a temporary consolidation or signals a broader trend reversal following the exceptional gains of 2025.

Copper prices experienced a decline on January 20, 2026, reversing recent gains despite continued strong demand fundamentals and geopolitical tensions. The retreat comes as market participants weigh conflicting signals from global demand patterns and trade policy uncertainties.

Current Market Performance

Copper prices showed mixed performance across major exchanges on January 20. The Multi Commodity Exchange of India (MCX) saw copper trading at ₹1,297.65 per kg, while international markets reflected similar weakness.

Despite the daily decline, copper has demonstrated strong medium-term performance with gains of nearly 8% over the past 30 days and surging over 36% on a one-year basis.

Demand Drivers Supporting Copper

Several fundamental factors continue to underpin copper demand despite recent price weakness. Industrial demand remains robust, particularly from sectors linked to renewable energy, electric vehicles, and infrastructure development. These sectors represent key growth areas driving long-term copper consumption.

A notable development supporting copper demand is substitution demand from other metals. With silver prices reaching record highs, manufacturers are increasingly testing copper as an alternative in certain applications, providing additional demand support for the red metal.

China Demand Concerns Weigh on Prices

Weakening demand signals from China, the world's largest copper consumer, have contributed to recent price pressure. The Yangshan import premium, a critical indicator of Chinese copper demand, has fallen by nearly half over the past month and currently sits at its lowest level since mid-2024.

Analysts have noted that record-high base metal prices are beginning to impact demand patterns, as elevated input costs pressure corporate profit margins and potentially reduce consumption.

Geopolitical Factors and Trade Policy Impact

Geopolitical tensions continue to influence copper markets, with trade war fears stemming from US policy positions. The situation involves US President Donald Trump's push to annex Greenland, which has faced opposition from European nations. In response, the US announced tariffs on countries resisting the move, while Europe prepares countermeasures.

However, market dynamics have been somewhat tempered by the US decision to delay tariffs on critical minerals. Additionally, China has intensified its crackdown on high-frequency trading in commodity markets, affecting trading patterns.

Market Outlook Considerations

Copper had reached fresh record highs recently, driven by optimism around the global clean energy transition and supply concerns linked to possible US tariffs. However, prices have moderated as market participants assess the balance between strong industrial demand fundamentals and emerging demand weakness in key consuming regions. The interplay between geopolitical tensions, trade policy developments, and fundamental supply-demand dynamics continues to shape copper price movements.