Daily September High Grade Copper

Comex High Grade Copper Futures Analysis – July 1, 2013

September High Grade Copper futures soared over 3% on Monday as manufacturing data from Europe and the U.S. calmed worries about demand.

Upbeat Euro-Zone manufacturing activity helped set the tone for the day. The report showed contraction in the region manufacturing activity had declined to its slowest pace in 16 months. This underpinned the market, setting it up for a further rally.

China’s manufacturing activity was mixed. The official manufacturing PMI data was basically in line with expectations at 50.1, but the HSBC manufacturing PMI, fell to 48.2 in June from 49.2 in May. The market held steady, probably because investors were expecting worse data.

Daily September High Grade Copper
Daily September High Grade Copper

The Institute for Supply Management’s manufacturing purchasing managers’ index rose to 50.9 in June from 49 in May. This beat estimates of 50, fueling hopes of a U.S. economic recovery.

Technically, after forming a four-day support base, September Copper finally broke out to the upside. The sideways action was indicating impending volatility and traders accommodated with a volatile surge to the upside.

Not only did the move confirm the closing price reversal bottom at 2.9855, but it also took out a long-term Gann angle with conviction. The angle, dropping at a rate of .02 per day since the June 5 top at 3.4125 had controlled the short-term direction of the market for almost a month.

With the reversal bottom confirmed, the market is now in a position to complete the countertrend rally with a move to a 50% level at 3.1990. If upside momentum can continue through this price level then look for a test of the downtrending Gann angle at 3.2325. New support is at 3.0655.  

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.

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