Comex High Grade Copper Futures (HG) Technical Analysis – July 21, 2016 Forecast

September Comex High Grade Copper prices recovered from yesterday’s early sell-off, but once again sellers rejected the rally as the market approached the last major high at $2.2775. Buyers have tried to take out this high six times since it was reached. The strong U.S. Dollar has probably prevented a breakout.

Today, the dollar is trading a little weaker, which could underpin copper. If the dollar continues to correct its recent rally then we could see an eventual breakout through $2.2775 over the near-term.

Technically, the main trend is up according to the daily swing chart. However, some of the upside momentum has been lost during the six-day sideways move. A trade through $2.2775 will signal a resumption of the uptrend.

Based on yesterday’s close at $2.2540 and the early price action, the direction of the market today is likely to be determined by trader reaction to the downtrending angle at $2.2285.

A sustained move over $2.2285 will signal the presence of buyers. This could create enough upside momentum to challenge the high at $2.2775. This is the trigger point for an acceleration to the upside with the April 22 top at $2.3060 the next likely target.

The inability to overcome $2.2285 will indicate the presence of sellers. This could create enough downside momentum to pull back into the short-term 50% level at $2.2400. Taking out this pivot will indicate that the selling is getting stronger. This could trigger a further break into a downtrending angle at $2.1510 and the main uptrending angle at $2.2065.

Watch the price action and read the order flow at $2.2285 the rest of the session. Trader reaction to this angle will tell us if the buying is getting stronger, or if sellers are taking control.