Comex High Grade Copper Futures (HG) Technical Analysis – October 17, 2016 Forecast

December Comex High Grade Copper futures closed lower on Friday and the momentum at the end of the session suggests the move may continue on Monday. Sellers are motivated at this time because of the stronger Dollar and concerns over the Chinese economy.

Late last week, copper prices were hit hard after the release of disappointing trade balance data from China. This week, investors will get the opportunity to react to China’s latest GDP data. It is expected to come in at 6.7%. If the actual number comes in better than expected then we could see a short-covering rally. If the number is worse than expected then look out to the downside.

TECHNICAL ANALYSIS

The main trend is down according to the daily swing chart. The market is in no position to turn the trend to up, but we could see a closing price reversal bottom if buyers come in to defend the main bottom at $2.0640.

The main range is $2.0640 to $2.2190. Its retracement zone is $2.1415 to $2.1230. Friday’s close below this zone puts copper in a weak position to start today’s session.

FORECAST

Based on Friday’s close at $2.1105, the first downside target is an uptrending angle at $2.0955. This is the last potential support angle before the $2.0640 main bottom.

On the upside resistance is clustered at $2.1230 to $2.1265. Overtaking this area could lead to a short-covering rally. The next objective is the short-term 50% level at $2.1415. This is the trigger point for an acceleration into $2.1640.

We’re likely to see a choppy, two-sided trade if the market holds between the two angles at $2.1265 and $2.0955.

These two prices, however, are also the trigger point for strong breakouts.