Chart of the day: Full marks for good behaviour
Shanghai aluminium futures, which we covered a month ago, have been behaving themselves very well indeed since then. They have consolidated in a large triangle pattern since April’s high, propped up by support from the Fibonacci 38 per cent retracement level at 11,700 yuan per tonne and the top of the weekly cloud at 11,585 yuan, with the 26-week moving average providing support (for now) for three consecutive weeks. Positive momentum has increased slightly over the past fortnight, and this week it has managed a break above the upper line of the triangle. We continue to favour a rally back up to the horizontal support/resistance line at 12,635 yuan, which coincides with the top of the Andrews pitchfork in August.
Nicole Elliott is a technical analyst