Futures Commentary and Analysis

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Copper Hits Upside Resistance
Thomas Bills - IF - Mon Mar 20, 4:44PM CDT

First off, the May Copper contract has a confirmed head & shoulders top pattern. It broke and closed below the neckline on March 6th. The overall downside target is ~ 2.4730 and my conservative target is ~ 2.5215. Original stops would probably be best above the right shoulder's high of 2.7685. That being said, this market has been rallying since the March 9th low to test the upward sloping neckline. This brings me to my current analysis, which sees Copper running into my Fib cluster resistance zone between 2.6745 and 2.6972. This resistance zone is supported by both the upward sloping h&s neckline and a downward sloping trend line. Today's price action saw higher prices made on selling, as we see a good sized red candlestick, and we closed below the 10 and 20 DMA's. If we can get a close below the 50 DMA soon, then I think Copper will at the very least test the recent lows. That would be the minimum target. Some more aggressive targets would be the 1st h&s top objective @ 2.5215, the monthly S2 pivot @ 2.5152, and the 2nd h&s top objective @ 2.4730. Downside obstacles are currently the 50 DMA ~ 2.6487, the monthly S1 pivot @ 2.6143, the 100 DMA ~ 2.5702, a Fib cluster support zone between 2.5468 and 2.5370, and the monthly S2 pivot @ 2.5152. If prices move back above 2.70, then this Fib cluster retracement pattern is voided.

Daily Chart


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