Comex High Grade Copper Futures (HG) Technical Analysis – December 18, 2015 Forecast

The inability to challenge the contract low with conviction along with a weaker U.S. Dollar helped trigger a strong short-covering rally by the March Comex High Grade Copper futures market early Friday. Fundamentally, the low price environment triggered some plans by companies to cut back production, giving the market some short-term support.

Technically, the main trend is down according to the daily swing chart. The short-term range is 2.0020 to 2.1385. Once again, the market straddled its retracement zone at 2.0705 to 2.0540. After early session weakness failed to drive the market into a new low, profit-taking and short-covering drove the market back over the zone, giving copper an upside bias into the opening.

Based on the pre-market price action and the current price at 2.0955, the direction of the market during the regular session is likely to be determined by trader reaction to the uptrending angle at 2.0920.

A sustained move over 2.0920 will signal the presence of buyers. The daily chart is open to the upside with the next target coming in at 2.1385. This is a trigger point for a surge to the upside with 2.1820 and 2.1860 potential targets.

The inability to take out 2.0920 with conviction will indicate the presence of sellers. The first downside target is a short-term 50% level at 2.0705. This is followed by a series of levels at 2.0595, 2.0540 and 2.0470.

The daily chart opens up to the downside under 2.0470 with the next likely target a slow-moving uptrending angle at 2.0245. This is the last potential support angle before the 2.0020 main bottom.

After the pre-market rally, traders should watch the price action and order flow at 2.0920 the rest of the session. A sustained move over this level will give the market an upside bias. A failure to overcome this angle will indicate that sellers have returned.