Copper slipped on Friday as speculators bet a rally had extended too far with demand in top consumer China likely to struggle and after new coronavirus cases in the United States hit record levels.

Copper has been the top gainer on the London Metal Exchange in recent months, rebounding 40 per cent from late March to a peak of more than five months on Thursday, partly on concern about supply from top producer Chile.

“The technical indicators are flashing overbought conditions and there are signals that global growth is stalling after the strong recovery we’ve had,” said Gianclaudio Torlizzi, partner at consultancy T-Commodity in Milan.

The relative strength index, a key indicator for investors relying on chart signals, rose to about 75 on Thursday, over the 70 level regarded as indicating a potential reversal.

Three-month LME copper was down 0.8 per cent at $US6,022.50 a tonne by 1600 GMT after touching $US6,120 on Thursday, its highest since January 22.

Copper was heading for a weekly gain of about 1 per cent, its seventh consecutive weekly rise, the longest winning streak in nearly three years.

“The price needs to cool down, but if it stays above $US5,400, it’s still a buy. I hope that we’re going to have pullback of about $US500,” Torlizzi said, adding that he had gone short on copper.

The United States reported a new daily global record of cases for the coronavirus pandemic, while top copper consumer China is entering its summer construction slowdown, which will crimp demand.

Copper inventories in warehouses tracked by the Shanghai Futures Exchange rose for the first time in seven weeks.

Nickel hit the highest mark since February 18 at $US13,130 a tonne after Shanghai stainless steel futures hit a six-week high.

Nickel, mainly used in the production of stainless steel, pared gains to $US12,995, up 0.4 per cent.

“A strong (Chinese) onshore bid (is) reflected in a substantial open interest increase on Shanghai,” Alastair Munro at broker Marex Spectron said in a note.

LME aluminium gave up 0.3 per cent to $US1,616 a tonne, zinc shed 0.4 per cent to $US2,037, lead rose 0.3 per cent to $US1,788 and tin added 0.5 per cent to $US16,910.