Comex High Grade Copper Futures (HG) Technical Analysis – November 23, 2015 Forecast

March Comex High Grade Copper futures tumbled to its lowest level in more than six years as investors fear China’s shift to a consumer-driven economy from investment-led expansion will slow demand by the world’s biggest user. A rebound by the U.S. Dollar earlier in today’s session also helped pressure demand for copper.

Although the lack of demand is the key market driver at this time. Over production is still an issue. The major producers are making cuts and applying discipline that should limit supply in the future, however, the smaller local firms are ramping up production and replacing the cuts that have been made.

Investors continue to short the market because they are bearish on the Chinese economy. Without a turnaround in sight, the only factor that could trigger any rally is aggressive speculative counter-trend buying or profit-taking and short-covering due to oversold conditions.

The main trend is down according to the daily swing chart. However, today’s session begins with the market in the window of time for a potentially bullish closing price reversal bottom. This chart pattern won’t mean the trend is getting ready to turn up, but that the market has run out of sellers.

Based on the current price at 2.0070, the daily chart indicates there is plenty of room to the downside with the nearest target coming in at 1.8495. The closest upside target is Friday’s high at 2.1000 and a downtrending angle at 2.1095.

If the market begins to rebound from the current intraday low at 2.0035 then watch the reaction and order flow at Friday’s close at 2.0595. This will tell us if the buying is greater than the selling at current price levels.