Yahoo Finance Comex High Grade Copper Price Futures (HG) Technical Analysis – Sustained Move Under $3.0465, Targets $2.9585
May Comex High Grade Copper futures slumped to their lowest level since December 12 on Tuesday. Multiple catalysts contributed to the decline including a stronger U.S. Dollar, rising interest rates, rising inventories and concerns about trade wars.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. The downtrend was reaffirmed on Tuesday when sellers took out swing bottoms at $3.0555 and $3.0465. According to reports, London Metal Exchange prices extended losses in the European afternoon as U.S. computer-driven funds stepped up selling.
The daily swing chart indicates there is room to the downside so don’t be surprised by an accelerated break. The next major bottom is the December 5 main bottom at $2.9585.
The market is in no position to change the main trend to up, but it may be ripe for a technical reversal or a quick 2 to 3 day short-covering rally due to oversold conditions. A dovish U.S. Federal Reserve or a weak U.S. Dollar could provide the fuel for a reversal to the upside.
The main range is $2.9585 to $3.3335. Its retracement zone at $3.1020 to $3.1460 is controlling the direction of the market. The close below this zone is contributing to the downside bias. Therefore, we can call the retracement zone resistance.
Forecast
Based on the downside momentum into the close, we’re anticipating further weakness. Short-sellers are hoping the market remains under $3.0465. This would indicate the selling is strong. If the selling volume continues then watch for a possible acceleration into $2.9585 over the near-term.
The first sign of buying will be overtaking $3.0465. The short-covering or buying will get stronger if $3.0555 is recovered. We could expect an even stronger rally if the buying takes out $3.1020.
This article was originally posted on FX Empire
