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Comex High Grade Copper Futures (HG) Technical Analysis – February 22, 2017 Forecast

By:
James Hyerczyk
Updated: Feb 22, 2017, 02:59 UTC

May Comex High Grade Copper futures surged early in the session on Tuesday, but gave back more than half of its earlier gains. However, it still managed

Copper Wire

May Comex High Grade Copper futures surged early in the session on Tuesday, but gave back more than half of its earlier gains. However, it still managed to close higher. Some traders blamed the stronger dollar for the intraday setback and talk of higher interest rates in the U.S.

Copper prices were still supported by disruptions and labor negotiations, which are affecting production at two of the world’s largest copper mines. Chile’s Escondida copper mine, the world’s largest, said on Tuesday it would not begin replacing striking workers for at least 30 days into a work stoppage to show its commitment to dialogue.

Comex High Grade Copper
Daily May Comex High Grade Copper

Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the $2.8360 main top on February 13. A trade through this top will signal a resumption of the uptrend. A move through $2.6955 will mean the downside momentum is getting stronger.

The main range is $2.6260 to $2.8360. Its retracement zone at $2.7310 to $2.7060 is the primary downside target. This zone provided support last week when the market reached its low at $2.6955.

The short-term range is $2.8360 to $2.6955. Its retracement zone at $2.7660 to $2.7825 is the primary upside target. This zone provided resistance on Tuesday when the market traded as high as $2.7755.

Forecast

Based on Tuesday’s close at $2.7575 and yesterday’s price action, the direction of the copper market today is likely to be determined by trader reaction to the short-term 50% level at $2.7660.

A sustained move under $2.7660 will signal the presence of sellers. This could lead to a break into an uptrending angle at $2.7460. This is followed by the main 50% level at $2.7310.

Crossing to the weak side of the steep downtrending angle at $2.7160 will indicate the selling is getting stronger. This could generate the momentum needed to test the main Fib at $2.7060 and last week’s low at $2.6955.

A sustained move over $2.7660 will indicate the presence of buyers. This could lead to a quick rally into $2.7760 and $2.7825. The latter is the trigger point for an acceleration to the upside with $2.8060 the next likely upside target.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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