Comex High Grade Copper Price Futures (HG) Technical Analysis – July 17, 2017 Forecast

September Comex High Grade Copper futures surged to their highest level since April 5 early Monday, supported by a weaker U.S. Dollar, supply concerns because of a strike in Chile and an upbeat second quarter GDP data from China.

The dollar was under pressure due to diminished prospects of a third interest rate hike from the U.S. Federal Reserve this year.

China reported earlier today that its economy grew 6.9 percent in the second quarter from a year earlier. This was faster than forecast and in line with first quarter results.

In other news, Hedge funds and money managers cut their net long position in copper futures, according to the U.S. Commodity Futures Trading Commission.

Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier today when buyers took out the last main top at $2.7185. If the upside momentum continues then the March 31 top at $2.7425 becomes the primary upside target.

Forecast

Based on the current price at $2.7185, the first upside target is the steep uptrending angle at $2.7310. Crossing to the strong side of this angle will put the copper market in an extremely strong position. This could create the upside momentum to challenge $2.7425.

Breaking back under the previous top at $2.7185 will signal the return of sellers. A sustained move under this price will indicate that the rally from $2.7185 to $2.7245 was fueled by short-covering rather than new buying. This could lead to further selling pressure.

The fundamentals are bullish at this time, but buyers have to be careful because today’s rally indicates the market may be getting ahead of itself.