Comex High Grade Copper Price Futures (HG) Technical Analysis – Testing Critical Short-Term 50% Level

May Comex High Grade Copper futures closed higher for the fifth day out of six on Tuesday as investors continued to ignore the geopolitical events and the movement in the U.S. Dollar, focusing instead on relatively low prices and the potential for future demand.

The price action suggests copper investors believe that the impact on China’s metal imports is unlikely to be dramatic. Additionally, investors are also seeing value after the recent steep price drop.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $3.1920 will change the main trend to up. A trade through $2.9375 will signal a resumption of the downtrend.

The minor trend is up. This is a sign that momentum may be getting ready to shift to the upside, but buyers have to clear out a retracement zone first. Otherwise, all we’ve been looking at is a normal correction in a bear market.

The main range is $3.1920 to $2.9375. Its retracement zone at $3.0650 to $3.0950 is the first upside target. The lower or 50% level at $3.0650 has provided resistance the last two days.

The longer-term range is $3.2905 to $2.9375. Its retracement zone at $3.1140 to $3.1560 is the primary upside target. This zone is controlling the longer-term direction of prices.

Daily Swing Chart Technical Forecast

Based on Tuesday’s close at $3.0635 and the price action this week, the direction of the copper market today is likely to be determined by trader reaction to the short-term 50% level at $3.0650 and a short-term uptrending Gann angle at $3.0575.

A sustained move over $3.0650 will indicate the presence of buyers. This could generate the upside momentum needed to challenge the Fib level at 3.0950. This is another trigger point for a rally into $3.1140 then $3.1220.

The inability to overcome $3.0650 will signal the presence of sellers, but a failure at $3.0575 will indicate the selling is getting stronger.

Look for an acceleration to the downside if copper crosses to the weak side of the downtrending Gann angle at $3.0520. This is a potential trigger point for an acceleration into the next uptrending Gann angle at $2.9975.