Comex High Grade Copper Price Futures (HG) Technical Analysis – August 14, 2017 Forecast

September Comex High Grade Copper futures are trading flat early Monday with investors showing almost no reaction to a string of mixed economic data from China.

In other news, hedge funds and money managers lifted their net long position in copper futures and options further to a fresh record, U.S. Commodity Futures Trading Commission data showed on Friday.

Today’s economic data from China, suggested a weakening economy across the board. Industrial Production was 6.4%, below the 7.1% estimate and 7.6% previous read. Fixed Asset Investment was 8.3%, also below the forecast and previous read of 8.6%. Retail Sales also missed the mark with a 10.4% gain, below the 10.9% forecast and 11.0% previous read.

Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the formation of the closing price reversal top at $2.9550 on August 9.

A trade through $2.9550 will negate the closing price reversal top and signal a resumption of the uptrend. A trade through $2.8600 will change the main trend to down.

The short-term range is $2.9550 to $2.8715. Its 50% level or pivot is $2.9135. This price is controlling the short-term direction of the market.

On the downside, the first major target is a long-term 50% level at $2.8305. This is followed by a major retracement zone at $2.7930 to $2.7550.

Forecast

Based on the current price at $2.9110 and the earlier price action, the direction of the copper market today is likely to be determined by trader reaction to the short-term pivot at $2.9135.

A sustained move over $2.9135 will indicate the presence of buyers. This could lead to a labored rally with potential target angles at $2.9250 and $2.9400. The latter is the last potential resistance angle before the $2.9550 main top.

A sustained move under $2.9135 will signal the presence of sellers. The daily chart is wide open under this level with the next major target a long-term uptrending angle at $2.8810.

Look for the selling pressure to increase on a sustained move under $2.8810 with potential targets last week’s low at $2.8715 and the main bottom at $2.8600.

The trend will change to down if $2.8600 is taken out. This could trigger an acceleration into the major 50% level at $2.8305.

Watch the price action and read the order flow at $2.9135 all session. The upside looks crowded, but there is room to the downside. The limited reaction to the data from China suggests investors may be focused on the U.S. Dollar. A weaker dollar should be supportive for copper.