Copper rallied yesterday following the Fed’s pivot as the market is now hoping for the central banks to start easing their momentary policies and avoid a global hard landing. Moreover, the Chinese deflation could trigger a stronger reaction from the PBoC with bigger rate cuts to stimulate growth and ultimately lead to higher Copper prices.
Copper Technical Analysis – Daily Timeframe
On the daily chart, we can see that Copper bounced on the 61.8% Fibonacci retracement level near the upward trendline and now eyes the key swing level at 3.90. A break above the level should give the buyers more conviction for an extension into the next resistance at 4.03. The sellers, on the other hand, are likely to step in around the 3.90 level to position for a drop back into the upward trendline.
Copper Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that Copper is breaking above the recent strong resistance around the 3.86 level. This should open the door for further upside into the key 3.90 level, but a pullback cannot be ruled out.
Copper Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the current price action with the price breaking above the resistance zone. We can see that we have a minor upward trendline with the 21 moving average for confluence where the buyers could lean onto in case the price pulls back. The sellers, on the other hand, will want to see the price breaking below the trendline to pile in and target a drop into the major trendline around the 3.77 level.
Upcoming Events
Today we will see the latest US Retail Sales and Jobless Claims figures, while tomorrow we conclude the week with the US PMIs. Weak data might weigh on Copper as some recessionary fears could return, while strong figures could still give the market hopes for a soft landing and boost prices.
