Copper may open flat Tuesday on hope of demand hope from China and as strong dollar dents investors' purchasing power for buying dollar-denominated commodities, said analysts.
"Base metals will be up on China demand hope while strong dollar will cap the prices at higher level," said Netra Deshpande an analyst with Emkay Global Financial Services.
Prices of the industrial metals will be supported as investors hoping more stimulus measures from China's central bank following slew of weak economic data, said analysts.
China's central bank cut the currency's reference rate by a record 1.9%, allowing depreciation to combat a slump in exports.
China imports fell 8.1% in July compared to analysts' estimate of 8.1% fall and 6.1% de-growth for the same period a year earlier, data by the National Bureau Statistics of China showed.
Exports in China also declined to 8.3% for the same period compared to 2.8% growth a year ago.
China Jan-Jul copper, copper product imports fell 9.5% to 2.59 million tons on year, government data showed.
China is the world's largest consumer of copper accounting for about 40% of total global demand and major consumer of other industrial metals.
However, sharp fall in the red metal prices will be capped by strong dollar against other currencies, said analysts.
At 9:50AM dollar index, which measures the strength of greenback against its six major trading partners, jumped 0.24% to 97.43.
Red metal prices will also be under pressure on higher stockpiles of the metal on LME, indicating oversupply situation, said analysts.
Copper stockpiles rose by 1,800 tons to 354,125 tons, LME data showed on Friday, its highest level since January 2014.
On Monday, copper for August delivery at the close of trades jumped 2.80% to Rs 338.95 per kilogram on the MCX.
MCX copper prices are likely to find support at Rs 324.1 per kilograms while resistance is seen at Rs 348.1 per kilograms today.
London Metal Exchange (LME) copper prices may open at $ 5,263.50 per MT and find support at $4,964 MT and resistance at $5,581 per MT.
MCX aluminium for July delivery at close of trades climbed 1.49% to Rs 101.85 per kilograms on the MCX.
Meanwhile, Goldman Sachs Group Inc, global investment bank, trimmed aluminium prices estimates by 21% from 2016 through 2018 on oversupply woes, Bloomberg reported.
The bank cuts its aluminium prices forecast to $1,525 ton in 2016, to $1,625 in 2017 and to $1,700 in 2018 from $1,925, $2,100 and $2,200 respectively previously estimated as it expects supply surplus of about 2.5 million tons to 3 million tons from 2016 to 2019.
MCX aluminium prices are likely to find support at Rs 98.9 per kilograms while resistance is seen at Rs 104.1 per kilograms today.
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