Friday erosion through 5590 (as we had expected) after a setback from 5800/05 leaves negative pressures intact for latter January.
This has already allowed for a push this morning to retest the mid-January spike low at 5353.
The mid-January capitulation sell off saw a break below the 2009 weekly swing low at 5810, the 61.8% retrace of the 2008-2011 rally at 5634 after the previous surrender of a key 2010 weekly low at 6037.5 and psychological 6000.0 set a more bearish tone.
Short-term Outlook - Downside Risks:
- The latter January threat is back through the 5353 spike low from mid-January.
- Below sees risk to the 5000 psychological level!!
- Bigger picture into mid-Q1, through here sees risk to weekly targets from 2009 at 4710 and 4685.
- The 78.6% retrace of the 2008-2011 rally is at 4395!!
What Changes This? Above 6000 eases bear risks; through 6189 signals a neutral tone, only shifting positive above 6345 .
- We see a downside bias for the 5353 cycle low; break here aims for minor targets at 5230 and 5150 ahead of 5000.
- But above 5500 opens risk up to 5704, which we look to cap.
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Daily LME Copper 3 Month Forward Chart
Weekly LME Copper 3 Month Forward Chart