Comex High Grade Copper Price Futures (HG) Technical Analysis – Tight Range Indicates Impending Volatility

March Comex High Grade Copper futures finished lower on Thursday despite the weaker U.S. Dollar. The price action suggests that even with a drop in the Greenback, foreign demand remains low for the dollar-denominated currency.

Copper traders are also saying that a shift out of copper and into stocks and crude oil by professional investors is helping to limit price gains.

Daily Swing Chart Analysis

The main trend is down according to the daily swing chart. The trend turned down on Thursday when sellers took out the previous main bottom at $3.2125. The selling continued only to $3.2065 after the change in trend which suggests the move may have been triggered by sell stops rather than aggressive shorting. This could be the first sign of a bear trap so be careful selling weakness.

The main trend will change back to up on a move through $3.2745.

The short-term range is $3.3220 to $3.2065. Its 50% level or pivot is controlling the direction of the market.

The main range is $2.9430 to $3.3220. If the selling pressure resumes then its retracement zone at $3.1325 to $3.0880 will become the primary downside target.

Daily Swing Chart forecast

Copper is trading higher early Friday. Based on the early price action, we could see a bearish tone on a sustained move under $3.2065. A bullish bias could develop on a sustained move over $3.2745.

A sustained move under $3.2065 will indicate that the selling pressure is getting stronger. This could trigger an acceleration into the main retracement zone at $3.1325 to $3.0880. We could see a technical bounce on the first test of this zone because it represents value.

A sustained move over $3.2745 will signal the presence of buyers. However, the rally could be labored because of a series of previous tops ranging from $3.3055 to $3.3220.

Taking out $3.3220 will reaffirm the uptrend. The trigger point for an acceleration to the upside is $3.3580.