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METALS-Copper retreats from Nov 2014 peak ahead of long weekend

* LME/ShFE arb: http://tmsnrt.rs/2oQ5nm20 (Updates with closing prices)

LONDON, Aug 25 (Reuters) - Copper futures retreated from their highest levels in 33 months on Friday as investors locked in profits from a rally and adjusted positions before a long weekend.

"I think we're seeing some profit-taking and book-squaring ahead of the holiday weekend," a trader said.

Monday is a market holiday in Britain and the London Metal Exchange will be closed.

Metals fell into the red across the board after analysts said industrial metals prices needed to take a breather after the LME index of six metals gained 18 percent since early June.

"I share the view that copper is over-extended and that a correction is due, but every correction needs a trigger," said Julius Baer commodities research analyst Carsten Menke in Zurich.

One trigger could be a rebound in the dollar and the other would be a confirmation that economic growth in top metals consumer China was due to slow down in coming months, he added.

* LME COPPER: Three-month LME copper closed down 0.3 percent at $6,666 a tonne, erasing gains after having touched $6,747, its highest since November 2014.

* COPPER INVENTORIES: Copper was earlier boosted when weekly copper stocks in warehouses registered by the Shanghai Futures Exchange declined by 8.2 percent to 187,444 tonnes <CU-STX-SGH>, data showed on Friday.

On-warrant inventories - those not earmarked for removal - in London Metal Exchange (LME) depots have halved to 112,950 tonnes over the past six weeks <MCUSTX-TOTAL>.

* ALUMINIUM: LME benchmark aluminium slid 1.7 percent to finish at $2,070 a tonne after LME inventories continued to rise. On-warrant stocks have gained 101,725 tonnes, or 10 percent, in about two weeks. <MALSTX-TOTAL>

* ALUMINIUM BACKWARDATION: The LME "tom-next" spread for aluminium <CMALT-0>, which is the cost of borrowing metal for a day and often a flashpoint for positioning tension, flared to a $10 backwardation.

* OPTIONS: The recent rally in implied options volatility has made buying options expensive but provided an opportunity for relative-value plays, such as buying LME aluminium calls and selling SGX iron ore calls, Citi analyst Daoyuan Zhou said in a note.

* PHILIPPINES: LME nickel ended down 2.2 percent at $11,485 despite news that lawmakers in the Philippines, the world's top nickel ore supplier, filed a bill to ban mining in watershed areas and halt exports of unprocessed ores.

* PRICES: LME zinc dropped 1.8 percent to close at$3,063.50, lead fell 1.4 percent to $2,325 and tin shed 0.8 percent to $20,325.

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(Reporting by Eric Onstad; Editing by David Goodman and Edmund Blair)