Copper was supported amid a boost to global growth in the first quarter on expectations of rate cuts, further PBoC easing and stronger economic data. Yesterday we received the first bad news: US PMIs far exceeded expectations and comments were generally pessimistic. Additionally, the recent revaluation of interest rates, with higher Treasury and U.S. dollar yields, may have dampened optimistic views and be the first sign of a further slowdown. The next round of data in May will give us better clarity.
Copper Technical Analysis – Daily Timeline
Copper daily
On the daily chart, we can see that copper finally broke the key level of 4.35 and extended the rally to a new cycle high at 4.57. From a risk management perspective, buyers will have a much better risk to reward setup around previous resistance turned support at the 4.35 level where they will also find the confluence of the red 21 moving average and the 21 level. 38.2% Fibonacci retracement Alternatively, if the price were to decline, they will find another good support around the trendline where the 61.8% Fibonacci retracement level for the confluence is also located.
Copper Technical Analysis – 4 hour time frame
Copper 4 hours
On the 4-hour chart, we can see that the price recently bounced off a minor trendline and is now finding some resistance around the red moving average 21. If the price were to break below the line of trend, sellers will accumulate to target a decline to the 4.35 level, and upon further breakout lower, the major trendline around the 4.20 level.
Copper Technical Analysis – 1 Hour Timeframe
Copper 1 hour
On the hourly chart, we can see that the price has broken through another minor downtrend line that defined the pullback towards the trendline around the 4.41 level. Buyers gathered on a breakout to position themselves for a rally to a new cycle high. If we were to get a pullback, we can expect buyers to rely on the ascending minor trendline where they will also find the confluence of the red 21 moving average and the 61.8% Fibonacci retracement level .
Events to come
Tomorrow we will see the latest US jobless claims figures, while on Friday we conclude the week with the US PCE report.
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