Copper – 7 March 2017

Copper is getting clubbed today on low China growth and strong inventory growth. The outlook has been rather fragile over the past few days, but with today’s move there is no question about the near term direction: down. Focus is on roughly 2.43 at first.  Below that a near term projection comes in around 2.3450.

However, the outlook on the longer term does not look too bad. Any near term decline towards 2.4130 (MA200) and even ~2.26 (Fib levels) is classified as a counter trend move on the weekly chart. In other words, our focus for the longer term is positive with a ‘buy on weakness’ strategy. Although selling pressure could be fierce over the next days and weeks, we clearly see shorting as a very risky strategy due to the development on the weekly chart.

  • Primary trend: basing/positive (early phase)
  • Outlook: longer-term positive
  • Strategy: avoid or buy larger dips
  • Support: 2.43 / 2.3450
  • Resistance: 2.9610 / 3.23*

Daily chart Copper (spot)

Weekly chart Copper (spot)