Chart of the day: Copper testing the trend
This week Shanghai copper future prices are testing secular trend-line resistance taken from 2011’s high. They are also pushing back up to try to retest Fibonacci 61.8 per cent retracement resistance for the fourth time this year, having managed a lunge at April’s surge as we had predicted in this column earlier. Moving averages of the Ichimoku cloud system are still just bullish, as are the 50- and 200-day ones – another element keeping momentum positive. Not surprisingly, volumes have decreased a bit this year as we are still in the range of 34,500 yuan to 38,500 yuan per tonne. It is probably time to break free because cloud resistance slumps towards the end of the year, to be confirmed by a weekly close above 38,500 yuan.
Nicole Elliott is a technical analyst