Copper has been supported amid a global growth impulse in Q1 due to rate cuts expectations, more PBoC easing and stronger economic data. Yesterday, we got the first bad news as the US PMIs missed expectations by a big margin and the commentary was generally downbeat. Moreover, the recent repricing in interest rates with higher Treasury yields and the US Dollar, might have dampened the optimistic views and be the first signs of another slowdown. The next set of data in May will give us some better clarity.
Copper Technical Analysis – Daily Timeframe
On the daily chart, we can see that Copper eventually broke through the key 4.35 level and extended the rally into a new cycle high at 4.57. From a risk management perspective, the buyers will have a much better risk to reward setup around the previous resistance turned support at the 4.35 level where they will also find the confluence of the red 21 moving average and the 38.2% Fibonacci retracement level. Alternatively, if the price were to break lower, they will find another good support around the trendline where there’s also the 61.8% Fibonacci retracement level for confluence.
Copper Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price bounced on a minor trendline recently and it’s now finding some resistance around the red 21 moving average. If the price were to break below the trendline, the sellers will pile in to target a drop into the 4.35 level, and upon a further break lower, the major trendline around the 4.20 level.
Copper Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the price broke above another minor downward trendline that was defining the pullback into the trendline around the 4.41 level. The buyers piled in on a breakout to position for a rally into a new cycle high. If we were to get a pullback, we can expect the buyers to lean on the upward minor trendline where they will also find the confluence of the red 21 moving average and the 61.8% Fibonacci retracement level.
Upcoming Events
Tomorrow we will see the latest US Jobless Claims figures, while on Friday we conclude the week with the US PCE report.
