Nickel retreated for the first time in six days as a price rally to the highest in nine months was seen excessive by some investors and a rise in inventories has stalled this week.
The metal for delivery in three months on the London Metal Exchange dropped as much as 1.3 percent to $15,078 a metric ton and traded at $15,122 by 2:25 p.m. Hong Kong time. Prices jumped to $15,345 yesterday, the highest intraday level since June 5. Today’s decline trimmed gains this year to 8.8 percent, still the best performer among the major six base metals on the LME.
The metal’s 14-day relative strength index rose to 73 yesterday as prices surged. Readings above 70 signal to some investors that it may have been overbought. Stockpiles tracked by the LME remained almost unchanged at 270,366 tons this week after climbing 0.7 percent last week, bourse data show.
“Nickel has moved up so quickly in the last few days,” said Chae Un Soo, a metals trader at Korea Exchange Bank Futures Co. in Seoul.
Copper in London was little changed at $7,028.25 a ton. The metal for May on the Comex in New York was also little changed at $3.203 a pound and the contract for the same month in Shanghai lost 0.5 percent to 49,140 yuan ($8,040).
China’s leaders spurred speculation they will allow the country’s $21 trillion debt mountain to inflate after refraining from cutting their annual economic-growth target. The nation is the world’s biggest user of industrial metals.
On the LME, aluminum, lead, zinc and tin all dropped.