Comex High Grade Copper Futures (HG) Technical Analysis – April 27, 2017 Forecast

July Comex High Grade Copper futures are bouncing back shortly before the regular session opening amid weakness in the U.S. Dollar. Helping to put a lid on the rally are concerns over future demand especially from China, due to possible restrictions from the government. Mixed U.S. economic data and an oversupply of product is also weighing on prices.

Technical Analysis

The main trend is down according to the daily swing chart. However, momentum appears to be ready to shift to the upside. A trade through $2.5085 will signal a resumption of the downtrend.

A long-term retracement zone at $2.6070 to $2.6515 is the nearest resistance. Inside this zone is a minor retracement zone at $2.6200 to $2.6460. Inside these zones is downtrending angle at $2.6360, making it a valid upside target also.

Forecast

Based on the current price at $2.5975 and the current intraday momentum, the direction of copper the rest of the session is likely to be determined by trader reaction to the major Fibonacci level at $2.6070.

Taking out $2.6070 will signal that the buying is getting stronger. This could trigger an extension of the rally into a series of levels at $2.6200, $2.6360, $2.6460 and $2.6515. The trigger point for an acceleration to the upside is $2.6515.

If sellers come in to defend the downtrend at $2.6070 then look for a possible intraday retracement back to the support cluster at $2.5685 to $2.5660.

The daily chart opens up to the downside under $2.5660 with the next target another support cluster at $2.5410 to $2.5385.

Watch the price action and read the order flow at $2.6070. Trader reaction to this level will tell us if the counter-trend buying is getting stronger.