COPPER – bears extend and look for test of weekly cloud top
Copper remains firmly in red at the beginning of the week and slid to new multi-month low at $2.9370 (the lowest since late Sep 2017) on probes below key support at $2.9425 (05 Dec low).
The metal holds in strong bearish mode which resulted in strong bearish close last week and came under fresh pressure on Monday on sharp rise in copper inventories.
Strong concerns about possible trade war on US tariffs on imported metals from China could further depress metal’s price if current talks about finding solution did not result in positive outcome.
Close below $2.9425 will be strong bearish signal for test of the top of rising weekly cloud ($2.9212) and extension towards rising weekly 55SMA ($2.9234).
Break here would risk test of $2.8930 (17 Sep trough / near 50% of $2.4720/$3.3200 rally).
Strongly oversold conditions of daily slow stochastic have so far been ignored, but some corrective action in coming sessions could be anticipated, as bears may also show hesitation on approach to rising thick weekly Ichimoku cloud.
Res: 3.0000; 3.0250; 3.0322; 3.0540
Sup: 2.9370; 2.9212; 2.9000; 2.8930