Dr. Copper losing its shine

Wednesday, 19th April 2017 10:44 - by Rajan Dhall

Copper prices are on the slide after geopolitical issues worry investors. London Metal Exchange copper was down 1.6% at USD 5,604 a tonne at 1455 GMT, as the LME resumed trading after the Easter weekend, CME Comex copper prices are also lower (chart below). This comes despite a good GDP reading from China on the Bank holiday.

Looking at the techs, there is a clear consolidation high and low. The low of the range currently stands at the 2.450 area and the high at the 2.800 candle rejection, the area I am concerned with is the mean value range around 2.600. If we see a rejection of the lows I believe we may have a clear target for an average price. Indecently, this level matches with the channel (flag) low and is very close to the 50% Fibonacci level. The move higher in the first place was mainly driven by the Trump rally although this has dissipated somewhat after the failed repeal of 'Obamacare' the fundamentals still remain, this is why I feel we could see a move back to fair value.

The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.