Copper has been falling steadily since the beginning of the new year with the market probably worried about a more pronounced global slowdown as the monetary policy lags filter through. The economic data overall has been weak but not pointing to a sharp slowdown. It’s a question whether the central banks will be able to deliver rate cuts in time before something breaks for real.
Copper Technical Analysis – Daily Timeframe
On the daily chart, we can see that Copper broke the key trendline that was defining the uptrend that started back in October 2023. We can also notice that the latest leg higher diverged with the MACD which is generally a sign of weakening momentum often followed by pullbacks or reversals. In this case, given the trendline breakout we can expect the price to fall into the support zone around the 3.73 level where we can also find the 50% Fibonacci retracement level for confluence.
Copper Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price is now pulling back into the downward trendline where we can also find the confluence with the Fibonacci retracement levels and the red 21 moving average. This is where we can expect the sellers to step in again with a defined risk above the trendline to position for a drop into the 3.73 support. The buyers, on the other hand, will want to see the price breaking higher to invalidate the bearish setup and start targeting new higher highs.
Copper Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that more closely the current price action with Copper approaching the selling zone. If the sellers will be successful, we can expect the buyers leaning on the 3.73 support zone to position for a rally back into the previous highs.
Upcoming Events
Tomorrow we will get the latest US CPI report and the US Jobless Claims figures, while on Friday we conclude the week with the US PPI data.
