As predicted earlier in this column, aluminium prices in Shanghai retreated from the Andrews pitchfork – but keep in mind that on a secular basis, anything below 12,500 yuan per tonne is cheap. Three weeks later and prices found retracement support at Fibonacci 38 per cent, the top of the Ichimoku cloud, and a new trend line. Bullish weekly moving averages support the view that the next step is another test of the top of the pitchfork just above horizontal resistance at 12,635 yuan. Then decision time looms where if push comes to shove, we would probably favour further rallies from what might turn out to be a secular low late last year.
