Comex High Grade Copper Futures (HG) Technical Analysis – September 23, 2016 Forecast

December Comex High Grade Copper futures are trading lower during the pre-market session. The market is coming off of a spike move to the upside on Thursday that was tied to the weaker U.S. Dollar. Today’s early move is being triggered by profit-taking and a stronger U.S. Dollar.

TECHNICAL ANALYSIS

The main trend is up according to the daily swing chart. A sustained move over $2.2000 will reaffirm the uptrend. The next main top comes in at $2.2570 so there is room for expansion if the buyers continue to come in to support the rally.

There is no danger of a change in trend at current levels. However, the market is in the window of time for a potentially bearish closing price reversal top. Traders should start to watch for signs of a top with an intraday higher-high, lower-close for example.

A pair of retracement zones come into play today. They are layered from bottom to top at $2.1605, $2.1750, $2.1835 and $2.2015. Trader reaction to this zone will likely determine the longer-term direction of the market.

FORECAST

BASED ON THE EARLY PRICE ACTION, THE DIRECTION OF THE DECEMBER COMEX HIGH GRADE FUTURES CONTRACT TODAY WILL LIKELY BE DETERMINED BY TRADER REACTION TO THE MAJOR FIBONACCI LEVEL AT $2.2015 AND THE SHORT-TERM FIBONACCI LEVEL AT $2.1835.

A SUSTAINED MOVE OVER $2.2015 WILL INDICATE THAT BUYERS ARE STILL COMING IN TO SUPPORT THE RALLY. HOWEVER, THE NEXT MOVE IS LIKELY TO BE DETERMINED BY TRADER REACTION TO DOWNTRENDING ANGLES AT $2.2095, $2.2225 AND $2.2335.

THE INABILITY TO OVERCOME $2.2015 WILL SIGNAL THE PRESENCE OF SELLERS. HOWEVER, MOMENTUM WILL SHIFT TO THE DOWNSIDE IF $2.1835 FAILS AS SUPPORT. THIS COULD CREATE THE DOWNSIDE MOMENTUM NEEDED TO TEST POTENTIAL SUPPORT LEVELS AT $2.1750, $2.1605 AND $2.1540.

WATCH THE PRICE ACTION AND READ THE ORDER FLOW AT $2.2015 AND $2.1835 TODAY. LOOK FOR THE UPSIDE MOMENTUM TO CONTINUE OVER $2.2015. LOOK FOR A DOWNSIDE BIAS TO DEVELOP ON A SUSTAINED MOVE UNDER $2.1835.