Comex High Grade Copper Futures (HG) Technical Analysis – May 29, 2014 Forecast

July Comex High Grade Copper futures traded lower in the pre-market session, making the high at 3.1925 a new main top. Combined with the previous main top at 3.1840, a potentially bearish “W” chart pattern may be forming. This means a break through the last main bottom at 3.0985 will turn the main trend to down on the daily chart.

The main range is 3.3970 to 2.8720. The retracement zone created by this range is 3.1345 to 3.1965. Throughout May these levels have been used as both support and resistance, it looks like June may begin on the bearish side of this zone if 3.1345 is taken out with conviction.

Crossing to the weak side of a downtrending angle at 3.1445 will be the first sign of weakness today, but a break though the lower or 50% level at 3.1345 is likely to trigger an acceleration down to the major uptrending angle at 3.1170. This is the major support point today because it rests on an uptrending angle from the 2.8720 bottom which has been giving the market both strength and direction for 49 market sessions.

The daily chart indicates there is room to the downside if 3.1170 fails as support. This move could signal the start of a correction into the retracement zone created by the rally from 2.8720 to 3.1925. This potential downside target is 3.0325 to 2.9945.

The same chart also shows there is room to the upside if 3.1965 can be taken out with conviction. The main target is a slow moving angle from the 3.3970 top which drops in at 3.2710 today.

With a new main top in place based on the overnight action, there should be an early bias to the downside. This bias will be confirmed by a move through 3.1345 and become clearer when the uptrending angle at 3.1170 is violated by a high volume move.