Comex High Grade Copper Price Futures (HG) Technical Analysis – May 24, 2018 Forecast

July Comex High Grade Copper futures are trading higher shortly before the regular session opening. The market is trying to recover from yesterday’s steep sell-off. Volatility has returned to the copper this week with the market spiking to the upside on Tuesday then plunging on Wednesday. This type of price action tends to indicate investor indecision.

On the bullish side, the market is being supported by expectations of increased demand and a possible supply shortage. Today’s weaker U.S. Dollar is helping to generate some foreign demand for the dollar-denominated asset.

Geopolitical tensions over U.S.-China trade relations helped drive prices down on Wednesday and may be limiting gains today. Also capping the market could be new worries over possible tariffs on imported automobiles.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed on Tuesday when buyers took out the previous main top at $3.1310. A trade through $3.0345 will change the main trend to down.

The price action is also being controlled by a pair of retracement zones.

The main range is $2.9585 to $3.2180. Its retracement zone is $3.0885 to $3.0575. The lower level of this zone provided support on Wednesday. Copper is currently trading inside this zone.

The short-term range is $3.2180 to $3.0140. Its retracement zone at $3.1160 to $3.1400 provided resistance earlier in the week.

Daily Swing Chart Technical Forecast

Based on today’s early trade, the direction of the copper market today is likely to be determined by trader reaction to the main 50% level at $3.0885.

A sustained move under $3.0885 will indicate the presence of sellers. This could drive the market into the Fib level at $3.0575. If this level fails then look for a possible break into a series of lows at $3.0485, $3.0345 and $3.0140.

A sustained move over $3.0885 will signal the presence of buyers. This is a possible trigger point for an acceleration into the short-term 50% level at $3.1160.