Reuters reported that London copper edged back from 2 week highs hit the previous session when the US housing market showed unexpected vitality while Greece was set to receive another round of aid, boosting risk appetite and soothing worries over metals demand.

Copper prices staged their biggest 1 day rally since September on Monday, after news Greece would receive EUR 44 billion in emergency loans helping the euro and sparking a round of short covering.

Mr Jonathan Barratt CEO of Barratt's Bulletin said that "We had a bit more positive news coming out of Europe but you really want to see whether that optimism can be sustained. On copper, there is some good rhetoric coming out of China and towards the end of the week that will solidify with the HSBC flash PMI."

He sees copper prices in a wide range of USD 3.40 to USD 3.80. Technically the charts are saying it will head to USD 3.60 but let's wait and see. Three month copper on the London Metal Exchange had slipped 0.54% to USD 7,760.50 per tonne by 0314 GMT reversing gains from the previous session.

Copper on Monday posted its biggest one day percentage gain since the US Federal Reserve announced further quantitative easing measures, rallying to its highest since November 2 at USD 7,807 per tonne. It is now up 2% on the year. The most traded February copper contract on the Shanghai Futures Exchange climbed 0.61% to CNY 56,390 yuan per tonne.

US home resales rose in October and a gauge of homebuilder sentiment climbed to a 6 year high in November signs of surprising vigour in the country's still struggling housing market. More indications of strength may emerge with US building permits and housing starts for October due later.

In Europe, euro zone finance ministers will give a tentative go ahead for the disbursement of EUR 44 billion in emergency loans to Greece but the money will only be paid on December 5 if the country meets all remaining conditions.

The euro settled back from Monday's two week highs, eroding some of the metals' upside momentum. A weaker dollar makes commodities cheaper for holders of other currencies. It's quiet today, as evidenced by tight ranges. Base is doing nothing after squeezing the shorts last night.