Comex High Grade Copper Price Futures (HG) Technical Analysis – Hitting Wall of Resistance at $3.3055 to $3.3580

March Comex High Grade Copper futures reached their highest level since 2013 last week amid aggressive fund buying. The catalyst behind the rally was optimism over the strength of the global economy, expectations of increased demand from China, and the possibility of supply interruptions in South America.

The weaker U.S. Dollar was the main driver of the price action, however. This is because copper is a dollar-denominated currency. So when the dollar weakens, copper becomes cheaper for foreigners, driving up demand.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. The main trend was reaffirmed when buyers took out $3.2790 last week. Investors have to be careful about buying strength, however, due to layers of former tops from 2013, providing a wall of resistance between $3.3055 and $3.3580.

The June 5, 2013 main top at $3.3580 is the trigger point for a potential acceleration into the March 27, 2013 main top at $3.4440.

Weekly Technical Forecast

If buyers reject the resistance levels then look for the start of a possible break into the steep uptrending support angle at $3.2630. Since the main trend is up, we could see a technical bounce on the first test of this angle.

If $3.2630 fails as support then we could see a further break into the short-term retracement zone at $3.1325 to $3.0880.