Copper Slips 20% From Peak: Is This A Warning Signal?

Copper had a strong run through 2025 and continued to climb in early January 2026. But that momentum has now faded. Prices of the metal have dropped sharply, falling about 20% from their peak levels in the global market.

On Tuesday, 17 February 2026, copper February contracts slipped 1.5% to trade at an intraday low of ₹1,179.35 on the Multi Commodity Exchange of India (MCX). Only recently, copper February contracts on the MCX touched a lifetime high of ₹1,480.30.

The scenario wasn’t much different in the global markets either. On the London Metal Exchange (LME), the red metal prices dropped by 1.8% to $12,813.06 per tonne. On Commodity Exchange Inc. (COMEX), copper prices declined by 1.6%.

Such a rapid downfall sparked fresh concerns among investors on a large scale. Is this indicating a shift in momentum, or is it just a temporary correction?

What May Have Caused The Fall?

There is no single reason that can be attributed to the ongoing drop in global copper prices. The first, and probably the strongest, reason can be profit booking by investors.

After a record rally in 2025 and throughout January 2026, investors stepped back and might have sold huge quantities. This resulted in reduced demand for copper in the short-term.

Another factor is the Chinese Lunar New Year, which started on 15 February and continues for nine days. During this time, several factories and trading centres remain closed. With industrial activity slowing, demand for metals such as copper may tend to weaken.

What Do The Analysts Say?

If the experts are to be believed, the recent drop in copper prices is nothing to worry about. This is potentially a consolidation phase for the red metal rather than a structural reversal. Global supply deficit and steady industrial demand are expected to push the copper prices northwards in the upcoming months.

Copper is extensively used in construction, electrical equipment, automobiles, and renewable energy systems. These sectors are expected to require significant quantities of copper in the coming years, which could keep demand strong over the longer term.

Mr Ajit Mishra, Senior Vice President at a private stockbroking firm, opined that the copper contracts at the MCX could consolidate around the ₹1,190 to ₹1,195 zone. He denied the possibility of a fundamental shift. He further added that the broader, long-term outlook for copper remains positive.

Mr Mishra said, “A persistent global supply deficit and steady industrial demand should continue to support copper prices.” He further added, “The recent weakness is largely due to short-term demand concerns stemming from the closure of Chinese markets for the Lunar New Year holidays. Thin liquidity during this period may result in erratic price swings.”

Also Read - Copper Prices Likely To Remain Uncertain Ahead Of Chinese Holidays

What Should Be The Trading Strategy For Investors?

For copper investors, the long-term outlook may remain supportive. In the short term, prices may move sideways or stay unpredictable. The period after the Chinese New Year holidays often brings clearer participation, and many traders track resistance and support zones to gauge direction.

If copper February contracts stabilise around ₹1,200 to ₹1,225, the zone is generally viewed as a level where fresh long interest tends to appear. At the same time, the use of stop losses remains a common risk-management practice to limit large losses.

Sources:

The Economic Times

MSN