Comex High Grade Copper Price Futures (HG) Technical Analysis – Key Weekly Support is $3.0880 to $3.0830

A jump in inventory drove March Comex High Grade Copper futures sharply lower for the week on Tuesday. Copper slumped to a one-month low as a large delivery of metal into exchange warehouses in Asia refocused attention on demand during a seasonally weak period for industrial activity in China.

Traders sold in reaction to the news that inventories tracked by the London Metal Exchange jumped the most in 10 months, continuing a pattern of spikes Comex High Grade Copper Price Futures (HG) Technical Analysis – Key Weekly Support is $3.0880 to $3.0830nd drawdowns in LME inventories seen throughout 2017.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart, however, momentum has been drifting lower since the week-ending December 29.

A move through $3.3220 will change the main trend to up. If the selling pressure continues, the trend will change to down on a move through $2.9430.

The main range is $2.9430 to $3.3220. Its retracement zone at $3.1325 to $3.0880 is currently being tested. Trader reaction to this zone will determine the near-term direction of the market.

Buyers are going to try to form a secondary higher bottom on a test of this zone and sellers are going try to drive prices through this zone.

Weekly Technical Forecast

Based on the current price action, the direction of the copper market the rest of the week will be determined by trader reaction to the 50% level at 3.1325.

A sustained move over $3.1325 will indicate the return of buyers. On the upside, the nearest resistance comes in at $3.2230 and $3.2420.

A sustained move under $3.1325 will signal the presence of sellers. This could drive copper into the support cluster at $3.0880 to $3.0830. Since the main trend is up, we could see a technical bounce on the first test of this area.

If $3.0830 fails as support then look for an acceleration into the next uptrending Gann angle at $3.0730.