Copper Technical Analysis

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.

This article was written by FL Contributors at www.forexlive.com.