Copper Technical Analysis – The price continues to melt amid negative catalysts 0 (0)

Fundamental
Overview

Copper experienced a pretty strong selloff this week with market
participants blaming the soft Chinese economic
data
and the increase in inventories in most global warehouses suggesting some
weak demand.

In the big picture, stable global growth and major central banks cutting
rates into resilient economies should be bullish drivers for the copper market
but more expansionary policies from Chinese officials would give a stronger
support for prices.

Copper
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that copper eventually erased all the gains from the first week of July and
dropped back to the key 4.35 support where we have also the 50% Fibonacci retracement level for confluence.

This is where we can expect
the buyers to step back in with a defined risk below the support to position
for a rally back into the 4.67 resistance. The sellers, on the other hand, will
want to see the price breaking lower to increase the bearish bets into the 4.00
level next.

Copper Technical Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that we might even form a range here between the 4.35 support and the 4.67
resistance. There’s not much else we can glean from this chart as the market
participants might keep on “playing the range” until we get a breakout on
either side.

Copper Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that we have a minor downward trendline defining the current bearish
momentum. The buyers will want to see the price breaking higher to gain more
conviction and increase the bullish bets into the resistance.

The sellers, on
the other hand, will likely keep on leaning on the trendline to push into new
lows and target a break below the support. The red lines define the average daily range for today.

Upcoming
Catalysts

Today we get the latest US Jobless Claims figures.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

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