December Comex High Grade Copper prices are still consolidating early Wednesday. The stronger U.S. Dollar is helping to limit gains. There is a slight upside bias developing. The hedge funds are still long, but they seem to be waiting for a catalyst to drive prices higher.
Daily Technical Analysis
The main trend is up according to the daily swing chart. A trade through $2.9925 will reaffirm the uptrend. Taking out $2.9050 and $2.8940 will change the main trend to down.
The major long-term support zone is $2.9150 to $2.8525. Inside this zone are layers of potential support levels at $2.9050, $2.8940, $2.8935 and $2.8795. It’s going to take a massive wave of selling to take out this zone.
On the upside, the major retracement zone at $3.0365 to $3.0700 is the primary upside target.
Daily Forecast
Based on the current price at $2.9490 (0838 GMT) and the earlier price action, the direction of the copper market today is likely to be determined by trader reaction to the long-term downtrending angle at $2.9685. This angle stopped the rally on Monday and earlier today.
Overtaking $2.9685 and sustaining the rally could trigger a fast move into an uptrending angle at $2.9340. Overtaking this angle will put the market in a bullish position with $2.9925 the next likely target.
Taking out $2.9925 will change the main trend to up and could trigger an acceleration to the upside with $3.0365 the next target.
Basically in two quick moves, copper could be at $3.0365 if the hedge funds turn into aggressive buyers again.
A sustained move under $2.9685 will signal the presence of sellers. The daily chart shows the next target angle comes in at $2.9140. This is followed by a support cluster at $2.9150 to $2.9140.