Comex High Grade Copper Futures Technical Analysis – October 4, 2013 Forecast

The wild price action by December High Grade Copper futures suggests investor indecision. Volatility was high on Thursday, but the lower close could mean there is a bias developing to the downside.

The main range is 3.3950 to 3.1905. The market has been straddling the retracement zone of this range at 3.2928 to 3.3269 for several days in a churning manner. This also indicates that investors aren’t sure which way they want to take the market. The close, however, under the zone could be indicating that sentiment is shifting to down.

Looking at the bigger picture, one can see the market is trading inside of a major triangle formation. This chart pattern tends to indicate impending volatility. The support angle or lower boundary of the triangle is 3.2655. Taking out this level with conviction could trigger a hard break into another angle at 3.2280. On the upside, the key angle to watch is 3.3250. Breaking this angle will be a sign of strength.

The main trend is up on the daily chart despite the recent sideways action. A breakout over 3.3395 will reaffirm the uptrend while a breakout under 3.2355 will turn the main trend to down.

The close on the low on Thursday puts the market in a position to take out 3.2655 early in the session. This could cause short-sellers to pile on and trigger an acceleration to the downside. If this price holds then it would send a signal that buyers are still coming in to support the market.