Comex High Grade Copper Price Futures (HG) Technical Analysis

Comex High Grade Copper Price Futures (HG) Technical Analysis – Has to Hold $2.9225 to Sustain Rally

James Hyerczyk

Updated Sun, Oct 1, 2017, 8:56 PM

December Comex High Grade Copper futures posted an inside move last week, but still managed to close higher for the week. The price action suggests investor indecision and impending volatility.

The price action was primarily driven by oversold conditions on the daily chart.

The stronger U.S. Dollar helped limit gains for the dollar-denominated futures contract. Fundamentally, supply and demand seems to be close to balanced. However, investors are becoming a little concerned about future demand in China and increased production.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. Despite the recent two-week correction, momentum never shifted to down according to the chart. All we experienced was a normal pullback into potential support levels.

In order to set up a possible change in trend, we’re going to have to see a secondary lower top first. Therefore, I wouldn’t read much into the next short-term rally because it may just be part of the set up.

A trade though $2.8940 will signal the return of sellers.

On the downside, the key support is a pair of 50% levels at $2.8405 and $2.8250. This is followed by a Fibonacci level at $2.7605.

On the upside, the nearest resistance is a major Fibonacci level at $3.0235, a short-term 50% level at $3.0365 and a short-term Fibonacci level at $3.0700.

Weekly December Comex High Grade Copper Short-Term

Weekly Forecast

Based on last week’s close and the price action, the direction of the copper market this week will be determined by trader reaction to the long-term uptrending angle at $2.9225.

A sustained move over $2.9225 will indicate the presence of buyers. If strong buyers come into the market then look for a drive into the previous mentioned resistance levels and a short-term downtrending angle at $3.0185.

The trigger point for an upside breakout is $3.0700.

Barring any major shift in the fundamentals, I expect the market to trade between $2.9225 and $3.0185. Traders should pay more attention to the support angle then the resistance angle. Because if $2.9225 fails, we could see a plunge to at least $2.8405 to $2.8250.

This article was originally posted on FX Empire