Comex High Grade Copper Price Futures (HG) Technical Analysis – Weekly Charts Says Bullish Over $3.0365, Bearish Under $3.0230

December Comex High Grade Copper futures posted its largest weekly gain since late August. The catalyst behind the rally was expectations of strong demand from top consumer China, although a strengthening U.S. Dollar capped gains.

The industrial metal is up more than 20 percent this year and finished the week up 2.50%.

Supporting the market are expectations of a deficit in the global refined copper market in the last three months of the year. However, some traders are saying that last week’s Chinese holiday may have contributed to the exaggerated rally due to low trading volume.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. A trade through $2.8940 will signal a shift in momentum to the downside.

Support is a pair of 50% levels at $2.8405 and $2.8250, followed by $2.7610.

On the upside resistance is $3.0230 and a short-term retracement zone at $3.0365 to $3.0700.

The near-term battle is likely to take place inside $3.0365 to $3.0700. Aggressive counter-trend sellers are going to try to stop a rally inside this area in an effort to form a potentially bearish secondary lower top. Buyers are going to try to drive the market through this zone in an effort to make $2.8940 a new main bottom.

Weekly Forecast

Based on last week’s close at $3.0290, the direction of the market is going to be determined by trader reaction to the 50% level at $3.0365 and the major Fibonacci level at $3.0230.

A sustained move over 3.3065 will indicate the buying is getting stronger. This could drive the market into the short-term Fib level at $3.0700. This is followed closely by a short-term downtrending angle at $3.0785. This is the trigger point for an acceleration into $3.1285. This is the last potential resistance angle before the $3.1785 main top.

A sustained move under $3.0230 will indicate the presence of sellers. Crossing to the weak side of the downtrending angle at $2.9785 will indicate the selling is getting stronger. This could trigger an acceleration into the major uptrending angle at $2.9425.

Basically, this week, investors should look for a bullish tone on a sustained move over $3.0365 and for a bearish tone on a sustained move under $3.0230.