Chart of the day: Zinc picks up the pace
At last, the price of zinc on the Shanghai Futures Exchange has accelerated to almost meet our first measured target at 27,000 yuan (US$4,053) per tonne. This sudden spurt is a classic move often seen in the charts when a market has spent rather too long consolidating towards the apex of a symmetrical triangle – this one extra important as it lies at the midpoint between the record high and record low for this contract. Though overbought, we feel the rally should continue to our next measured target at 28,700 yuan because bullish momentum, observed volatility and volume all remain high, with a strong probability of an extension to a band between 29,175 and 29,775 yuan.
Nicole Elliott is a technical analyst