Comex High Grade Copper Futures (HG) Technical Analysis – August 28, 2015 Forecast
December Comex High Grade Copper futures soared on Thursday after comments by U.S. Federal Reserve officials helped calm global markets. On Thursday, New York Federal Reserve President William Dudley said the case for a U.S. interest rate hike in September has become less compelling.
Additionally, Federal Reserve Bank of Kansas City President Esther George said in a CNBC interview from Jackson Hole, Wyoming that the central bank should normalize interest rates. She added it’s important for the Fed to understand the extreme volatility in stock markets this week, but cautioned that markets are focused on the near term.
The two Fed member statements failed to provide any guidance as to when the Fed is likely to raise interest rates. However, they did seem to provide some relief for traders because the comments offered fresh news during a week primarily dominated by news from China.
Also helping to boost prices was stronger-than-expected U.S. GDP growth. This report showed the economy grew by 3.7 percent.
Technically, the main trend is down on the daily swing chart, however, the momentum has shifted to the upside.
The short-term range is 2.4350 to 2.2025. Its 50% level or pivot is 2.3190. Copper closed on the strong side of the pivot, putting it in a bullish position. The market also closed on the bullish side of a downtrending angle. This puts copper in a position to challenge the next downtrending angle at 2.3700. This is the last major angle before the last main top at 2.4350.
The main range is 2.6605 to 2.2025. Its retracement zone is 2.4315 to 2.4855. A downtrending angle passes through this zone at 2.4455, making it a valid it a valid target also. The best potential upside target is the price cluster formed by the 50% level at 2.4315 and the main top at 2.4350.
Crossing to the weak side of the pivot at 2.3190 and the downtrending angle at 2.3050 will signal the presence of sellers. This could trigger a resumption of the selling pressure, making 2.2425 the next likely downside target.
Watch the price action and read the order flow at 2.3190. This will tell us whether the bulls or the bears are in control.