Tin Risks Collapse as Support Gives Way: Chart of the Day

By Claudia Carpenter

Dec. 18 (Bloomberg) -- The price of tin, which has fallen the least among raw materials on the London Metal Exchange, may collapse after slipping below “trendline support,” Barclays Capital said.

The CHART OF THE DAY shows tin for delivery in three months on Dec. 16 fell below the metal’s support line since Oct. 24. Nickel, zinc, aluminum and lead on the London exchange have already broken “significant long-term support,” Barclays technical analyst Phil Roberts said in London yesterday. Tin has dropped 34 percent this year on the exchange, compared with a 63 percent slump in nickel and 62 percent in lead.

“Every time we’ve seen those levels tested in the other base metals recently, they’ve given way,” Roberts said. “The story is it’s bearish near term” for tin.

Tin for delivery in three months may fall to $9,004 a metric ton, the lowest since October 2006, Roberts said. Tin traded at $10,930 a ton as of 11:16 a.m. in London.

Electronics companies that use tin to stick components on printed circuit boards make up more than 50 percent of demand, according to industry group ITRI Ltd. Apple Inc., maker of the iPod music player, has tumbled 55 percent in New York trading on anticipation a global recession will curb spending on gadgets.

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net or ccarpenter2@bloomberg.net