Copper continues to be supported by favorable fundamentals, even if the latest rally is starting to look a little exhausted. Supportive factors include the recent beating of China’s PMIs and the US ISM manufacturing index, with the latter beginning an expansion for the first time since 2022. Additionally, the PBoC is expected to provide more policy support this year while others central banks They continue to plan for rate cuts at some point, although they are prepared to keep rates high for longer if necessary. The current environment should be favorable for growth. We will therefore need to watch for signs of a marked deceleration in growth indicators or increased risks of rate hikes.
Copper Technical Analysis – Daily Timeline
Copper 4 hours
On the daily chart, we can see that copper is struggling to break the key level of 4.35. From a risk management perspective, buyers will have a much better risk to reward a setup around the 4.18 level where one can also find the confluence of the 50% Fibonacci retracement level of the moving average red 21 and trend line. Sellers, on the other hand, will likely intervene around these levels to position themselves for a decline into the trendline and ultimately target a breakout below it.
Copper Technical Analysis – 4 hour time frame
Copper 4 hours
On the 4-hour chart, we can see that price has diverged with the MACD, which is usually a sign of weakening momentum, often followed by pullbacks or reversals. In this case, the target for the pullback would be right around the base of the divergent formation, near support at 4.18, although price will first need to cross the black minor trendline to confirm this.
Copper Technical Analysis – 1 Hour Timeframe
Copper 1 hour
On the hourly chart, we can see that the price has rejected the 4.35 level and is now falling back towards the minor trendline. Buyers will have another opportunity to intervene around the trendline to position themselves for a break above resistance at 4.35. If the price were to decline, sellers would take control and bring the price into the 4.18 support.
Events to come
Tomorrow we will receive the latest figures for jobless claims in the United States.
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