Comex High Grade Copper Price Futures (HG) Technical Analysis – Key Pivot to Watch is $3.2675

March Comex High Grade Copper futures surged on Wednesday in reaction to a plunge in the U.S. Dollar against a basket of major currencies. The lower dollar drove up foreign demand for dollar-denominated copper.

Daily Swing Chart Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the formation of the main top at $3.220 on December 28.

The price action on Wednesday created a new main bottom at $3.2125. A trade through this level will change the main trend to down. A move through $3.3220 will reaffirm the uptrend.

In addition to the main top at $3.3220, buyers face a wall of resistance from former tops, ranging from $3.3055 to $3.3580. The latter is the trigger point for an acceleration to the upside with the March 27, 2013 main top at $3.4440 the next major upside target.

If sellers can take out $3.2125 with strong volume, the copper market could break into the retracement zone at $3.1325 to $3.0880. Since the main trend is up, buyers could show up on a test of this area.

Daily Swing Chart Forecast

Based on Wednesday’s price action, the direction of the March Comex High Grade Copper market will be determined by trader reaction to the short-term pivot at $3.2675.

A sustained move under $3.2675 will indicate the presence of sellers. This could lead to a test of $3.2125. Taking out this level could trigger an acceleration to the downside with the next major target coming in at $3.1325.

Overtaking $3.2675 and sustaining the move will signal the return of buyers. This could create the upside momentum needed to challenge the main top at $3.3220. Look for a labored rally until $3.3580. This price is the trigger point for a possible acceleration into $3.4440.

Basically, sellers are trying to form a potentially bearish secondary lower top at $3.2675. Buyers are trying to continue the rally with $3.2125 the new main bottom.