Comex High Grade Copper Price Futures (HG) Technical Analysis – Closing Price Reversal Top Indicates Selling Greater than the Buying

September Comex High Grade Copper investors continued to toy with highs not seen since May 2015 on Wednesday. However, the move may have been hampered by a volatile U.S. Dollar which tends to effect demand for the dollar-denominated commodity.

Traders also reacted to a disappointing Chinese consumer inflation report and signs of increased buying by domestic and overseas commodity funds.

Technically, the main trend is up according to the daily swing chart.

If buyers can establish a support base on the strong side of the May 15, 2015 main top at $2.9375 then this could create enough upside momentum to eventually drive the market into the major Fibonacci level at $3.0300.

A failure to hold $2.9375 may be an indication that today’s breakout to $2.9550 was fueled by short-covering and buy stops rather than aggressive new buying.

Today’s higher high signaled a resumption of the uptrend, however, the subsequent intraday break has put the market in a position to form a potentially bearish closing price reversal top. If this chart pattern forms and the pattern is confirmed, we could see the start of a 2 to 3 day correction.

On the upside is a steep uptrending angle at $2.9400. A sustained move on the strong side of this angle will put copper in a bullish position.

On the downside, Gann angle targets come in at $2.9000 and $2.8800. The latter is the last potential support angle before the $2.8600 main bottom.

Watch for a possible closing price reversal top. This will be the first indication that the selling is greater than the buying at current price levels.