Comex High Grade Copper Price Futures (HG) Technical Analysis – Set Up for Plunge into $3.1325

March Comex High Grade Copper futures hit a multi-week low on Tuesday as a steadier U.S. Dollar weighed on demand. Profit-taking was also behind the selling pressure as investors prepared for lower demand from China shortly before the Lunar New Year.

Traders continue to react to some trade data from China last week which indicated imports of refined metals have been somewhat slow.

In other news, LME copper inventories have climbed 12 percent since the start of December to 204,650 tonnes.

Daily Technical Analysis

One day after turning the main trend to up, the trend turned back down on Tuesday. The new main top is $3.2910. A trade through this price will change the main trend back to up.

A trade through $3.2065 changed the main trend to down earlier today when sellers took out the swing bottom at $3.2065.

The main range is $2.9430 to $3.3220. Its retracement zone at $3.1325 to $3.0880 is the primary downside target. This is also a value zone so we could see a technical bounce on the first test of this area.

Daily Technical Forecast

Based on the earlier price action, the direction of the copper market into the close is likely to be determined by trader reaction to the downtrending Gann angle at $3.2020.

A sustained move under $3.2020 will indicate the selling is getting stronger. If the selling volume increases on the move then we could see an acceleration into the main 50% level at $3.1325.

A sustained move over $3.2020 will signal the presence of buyers. This could drive the market into a long-term uptrending Gann angle at $3.2230. Crossing to the strong side of this angle could fuel further short-covering.