QC1! trade ideas
Key Levels and US Market Review for the Asian session open 7/03A review of the price action from the European session and the US session. DAX managed to hold onto recent gains while the FTSE edged lower. The US managed to open stronger and push higher but it was not long until we saw some profit taking and prices edged lower into the close. Traders continue to focus on the global economy versus sticky/high inflation and at this stage data is pointing to a resilient US economy absorbing those higher prices due to inflation. There is no fear driven selloff which shows that bargain hunters still believe in a longer term move up thanks to resilient economies so I continue to expect major swings in momentum up and down.
I remain of the view that sticky inflation is the big issue and will weigh on share markets if the Fed, and other major central banks, can not get it under control.
I look at some key levels to watch and the price action setups I expect to see play out.
Markets covered :-
DOW
Nasdaq
DAX
FTSE
ASX200
Hang Seng
USD Index
Gold
Oil
Copper
Copper has room for higher levels into the mid MarchHere is our pump, markets should follow, ideally after the next week’s low
Buying Copper at 50% retracement.XCUUSD - Intraday - We look to Buy at 4.074 (stop at 4.034)
The 50% Fibonacci retracement is located at 4.087 from 4.237 to 3.937.
Prices have reacted from 3.936.
Daily signals are mildly bullish.
Short term momentum is bullish.
A lower correction is expected.
Our profit targets will be 4.174 and 4.194
Resistance: 4.130 / 4.150 / 4.175
Support: 4.100 / 4.070 / 4.050
Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Copper Futures ( HG1! ), H4 Potential for Bearish DropTitle: Copper Futures ( HG1! ), H4 Potential for Bearish Drop
Type: Bearish Drop
Resistance: 4.1130
Pivot: 4.0145
Support: 3.8945
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bearish due to the current price being below the Ichimoku cloud , indicating a bearish market.
Expecting price to drop from the pivot at 4.0145 where the overlap resistance and 23.6% Fibonacci line is before continue heading down towards the support at 3.8945, where the overlap support is.
It's worth noting that there is an intermediate support at 3.9245, where price might struggle to break through
Alternative scenario: Price could head up towards the resistance at 4.1130, where the overlap resistance and 61.8% Fibonacci line is.
Fundamentals: There are no major news.
Copper Futures ( HG1! ), H4 Potential for Bearish DropTitle: Copper Futures ( HG1! ), H4 Potential for Bearish Drop
Type: Bearish Drop
Resistance: 4.1130
Pivot: 4.0145
Support: 3.8945
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bearish due to the current price being below the Ichimoku cloud , indicating a bearish market.
Expecting price to drop from the pivot at 4.0145 where the overlap resistance and 23.6% Fibonacci line is before continue heading down towards the support at 3.8945, where the overlap support is.
It's worth noting that there is an intermediate support at 3.9245, where price might struggle to break through
Alternative scenario: Price could head up towards the resistance at 4.1130, where the overlap resistance and 61.8% Fibonacci line is.
Fundamentals: There are no major news.
Copper on upward trendcopper is on upward trend and this will be supported by China reopening. Ichimoku is supporting the trend. price is above the dynamic line support and is also above 100 moving average. The trend is more likely to continue its upward move in March.
Copper Analysis and Forecast (SELL)A technical analysis of a trendline breakout and subsequent retest indicates that a short position on HG futures could be a favorable option at present.
Copper prices dropped to their lowest point in almost seven weeks on Friday, due to a stronger dollar and weakened demand in top consumer China. The rising value of the dollar made metals more expensive for buyers using other currencies, as robust US economic data and high inflation figures raised expectations of extended higher US interest rates. The tepid demand for copper in China's top consumer market and the possibility of increased US interest rates have both contributed to the fall in copper prices, although global supply disruptions have helped limit the decline. As of 0817 GMT, the three-month copper on the London Metal Exchange (HG1!) fell by 0.4% to $8,863.50 a tonne, and the most actively traded April copper contract on the Shanghai Futures Exchange (HG1!) closed 0.9% lower at 69,610 yuan ($10,027.66) per tone.
demand in China post-Lunar New Year holiday hasn't bounced back as much as some had hoped, indicating weakened support from the demand side. Moreover, the Yangshan copper premium (SMM-CUYP-CN), which reflects the demand for imported copper in China, is down 85% from October last year, standing at $22.50 per tone on Thursday.
Considering the technical analysis of trendline breakout and retest, a short position on HG futures could be a good trading opportunity for investors.
Possible reversal zone for copper As you can see we are at the bottom of a broadening formation and just below the support of an uptrend channel , I expect a move to the up side in the next couple of weeks
Copper is red hot on China’s reopening, but there is more to itCopper is to commodities, what tech stocks are to equities. They are both historically cyclical but also promise potential long-term growth. Tech stocks were down last year, not because the underlying technologies were dead, but because central banks were aggressively tightening monetary policy. Copper too endured the same fate on account of macro headwinds despite the accelerating energy transition. Lockdowns in China added another layer of disappointment.
So, with the macro backdrop changing this year, is the red metal becoming red hot? Markets appear to be endorsing that narrative. What does the demand and supply situation look like?
China reopening
China consumes more than half of global refined copper with its demand experiencing an eight-fold increase in the past four decades1. Chinese manufacturing activity, therefore, is inevitably a key driver of copper prices (see figure below).
Chinese manufacturing activity remained contractionary through August till December last year, as evident from the Manufacturing Purchasing Managers’ Index. In January, while the number remained contractionary at 49.22, the expectation is for it to pick up in the coming months if lockdowns remain sustainably lifted.
China is a crucial source of copper’s green demand too. Chinese subsidies for electric vehicle (EV) makers have given rise to a booming industry to the point where BYD is now competing fiercely with Tesla for market share worldwide. Although subsidies for producers will come to an end this year, tax exemptions for buyers will remain in place through 2023. This will further be supported by the rollout of charging infrastructure, a key component of China’s 14th 5-year plan issued in December 2022.
A battery EV can require three to four times as much copper as an equivalent internal combustion engine vehicle. Similarly, a 200 kilowatt (kW) fast charging station uses around 8 kilograms of copper3. There is a similar multiplicative effect on copper demand from other energy transition applications like renewable wind and solar power, which China is heavily investing in.
The supply side
In What’s Hot: Dr Copper’s misdiagnosis, we highlighted how copper’s inventories on exchanges are perilously low, a sign of supply tightness which could exacerbate if demand picked up quickly.
According to Wood Mackenzie, copper may see a slight global refined market surplus of 170 kilotons (kt) in 20234. But there is considerable uncertainty surrounding this forecast. On the supply side, disruptions such as the ones we’ve seen recently in Peru could play an important role. Peru is the second largest copper producing nation and is responsible for around 10% of global mined production.
Anti-government demonstrations in Peru have led to shipments being halted at the 300 kt Las Bambas mine, and disruptions at Glencore’s 180 kt Antapaccay mine, and other mines including Constancia (117 kt) and Cuajone (148 kt)5.
The figures above highlight how disruption in supply from Peru can easily tip the copper market into a deficit. While disruption may not be as severe this time as it was when Covid caused mine closures in Chile and Peru in 2020-2021, it could still be meaningful especially if coupled with more demand from China. Market pricing has been moving in response to these developments.
The energy transition
At the World Economic Forum in Davos in January, European Commission President Ursula von der Leyen pledged unprecedented support in clean technology across all sectors of the energy transition. For Europe to remain competitive in the new era of clean energy, it must offer something that can rival the US Inflation Reduction Act. In 2023, we expect more action from US, Europe, and China now that energy security has become synonymous with the energy transition.
According to Wood Mackenzie, for the world to be on track for net zero by 2050, 9.7 Mt of mine supply will need to come from projects that are yet to be approved. This amounts to $23bn of investment a year in new projects, 64% higher than the average annual spend over the last 30 years.
Conclusion
Copper’s long-term demand trends suggest it could continue trending upwards but remain cyclical depending on the macroeconomics. Cyclical pullbacks could create interesting entry points for investors who recognise copper’s structural case.
Sources
1 International Copper Study Group’s Factbook 2022.
2 Bloomberg, January 2023.
3 International Copper Study Group 2023.
4 Wood Mackenzie’ report, “Copper: Things to look for in 2023” dated January 2023.
5 Morgan Stanley as of January 2023.
Copper Futures (HG1!), H4 Potential for Bullish RiseTitle: Copper Futures (HG1!), H4 Potential for Bullish Rise
Type: Bullish Rise
Resistance: 4.5770
Pivot: 4.2155
Support: 4.1090
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bullish due to the current price being above the Ichimoku cloud , indicating a bullish market. If this bullish momentum continues, expect price to possibly head towards the resistance at 4.5770, where the previous swing high is.
Alternative scenario: Price may head back down towards the support at 4.1090 where the overlap support is.
Fundamentals: There are no major news.
Copper Futures (HG1!), H4 Potential for Bullish RiseTitle: Copper Futures (HG1!), H4 Potential for Bullish Rise
Type: Bullish Rise
Resistance: 4.5770
Pivot: 4.2155
Support: 4.1090
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bullish due to the current price being above the Ichimoku cloud , indicating a bullish market. If this bullish momentum continues, expect price to possibly head towards the resistance at 4.5770, where the previous swing high is.
Alternative scenario: Price may head back down towards the support at 4.1090 where the overlap support is.
Fundamentals: There are no major news.
Copper dips continue to attract buyers.XCUUSD - Intraday - We look to Buy at 4.024 (stop at 3.984)
Selling posted in Asia.
The bullish engulfing candle on the daily chart is positive for sentiment.
Short term momentum is bearish.
A lower correction is expected.
We expect prices to stall close to our bespoke level (4.020).
Our profit targets will be 4.124 and 4.144
Resistance: 4.080 / 4.100 / 4.133
Support: 4.060 / 4.040 / 4.020
Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
watching for break of resistance 🙈above 815 i expect a push to all time highs, doesn't go much further than that. boost and follow for more <3
Copper Futures ( HG1! ), H4 Potential for Bearish DropTitle: Copper Futures ( HG1! ), H4 Potential for Bearish Drop
Type: Bearish Drop
Resistance: 4.2215
Pivot: 4.1205
Support: 3.9245
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bearish due to the current price being below the Ichimoku cloud , indicating a bearish market.
Expecting price to continue heading down towards the support at 3.9245, where the overlap support is.
Alternative scenario: Price could head up towards the resistance at 4.2215, where the overlap resistance is.
Fundamentals: There are no major news.
Copper showing mixed signals with Bullish bias to $4.80Cup and Handle formed on Copper
Price >200 Bullish
21>7 Bearish
RSI <50
Target $4.80
Mixed - Bullish bias
Resources definitely showing upside to come in the medium term, but right now there is a but of a breather which is causing a bit of selling pressure. We need to weather through this sideways range before the market chooses a direction. My bias is up but there needs to be the next catalyst. Also the US Dollar is showing short term strength which is also not great for resources as resources is priced in US dollars. and so when US strengthens the price for resources become less profitable for imports to countries.
Copper Futures ( HG1! ), H4 Potential for Bearish DropTitle: Copper Futures ( HG1! ), H4 Potential for Bearish Drop
Type: Bearish Drop
Resistance: 4.1205
Pivot: 4.0470
Support: 3.9245
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bearish due to the current price being below the Ichimoku cloud , indicating a bearish market.
Expecting price to continue heading down towards the support at 3.9245, where the overlap support is.
Alternative scenario: Price could head up towards the resistance at 4.1205, where the overlap resistance is.
Fundamentals: There are no major news.
Copper bulls to return around $4.00?Price action on copper has caught our eye, as its pullback from the YTD highs has paused above the November highs despite a surging US dollar. RSI (2) is overbought on the daily chart, and yesterday’s Doji held above the 20-day EMA. It's also holding above $4.00, whilst money managers and large speculators have continued to increase their net-long exposure to copper futures despite the pullback on prices.
- From here, the bias is bullish above 3.95 and for prices to have another crack at the YTD high
- Another approach is to scale into such a position with a wider stop, with a view to increase exposure if or when momentum turns higher sufficiently enough to call a swing low.
Copper in uptrendThe MCX:COPPER1! is in uptrend despite the counter COT commercial index direction. Additionally, the strong resistances on weekly basis may give support. Bullish continuation is possibel only daily close above this strong resistance area.
SL: 4.1 (last local low)
1. Target: 4.475 ( next resistance on weekly basis)
2. Target: 4.55( next resistance on daily basis)
Manage your risk and take your own decisions.
Bear Flag continuation on Copper (Weekly Timeframe)As the DXY appears to have marked the beginnings of a relief rally following exhaustive sell pressure and Friday's strong close. Copper looks to see a continuation of the Bear Flag setup.
This move would likely mark the second leg of the Bear Market a severe recession which is my working hypothesis as the substantial rate of hikes from the Fed has yet to manifest as many maturities are set to roll over into the new regime with higher interest rates.
Do your own diligence, and never put down money on someone else's bet. This is intended to serve solely as a information when a individual carries out their own independent analysis.
Copper Futures ( HG1! ), H4 Potential for Bearish DropTitle: Copper Futures ( HG1! ), H4 Potential for Bearish Drop
Type: Bearish Drop
Resistance: 4.2300
Pivot: 4.1165
Support: 3.9245
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bearish due to the current price being below the Ichimoku cloud , indicating a bearish market.
Expecting price to continue heading down towards the support at 3.9245, where the overlap support is.
Alternative scenario: Price could head up towards the resistance at 4.2300, where the overlap resistance is.
Fundamentals: There are no major news.
Copper Futures ( HG1! ), H4 Potential for Bearish DropTitle: Copper Futures ( HG1! ), H4 Potential for Bearish Drop
Type: Bearish Drop
Resistance: 4.2300
Pivot: 4.1165
Support: 3.9245
Preferred case: Looking at the H4 chart, my overall bias for HG1! is bearish due to the current price being below the Ichimoku cloud , indicating a bearish market.
Expecting price to continue heading down towards the support at 3.9245, where the overlap support is.
Alternative scenario: Price could head up towards the resistance at 4.2300, where the overlap resistance is.
Fundamentals: There are no major news.
Copper potential for bearish drop to overlap supportLooking at the H4 chart, my overall bias for HG1! is bearish due to the current price being below the Ichimoku cloud, indicating a bearish market.
Looking for a sell entry at 4.1165, where the overlap resistance is. Stop loss will be at 4.2065, where the overlap resistance is. Take profit will be at 3.9335, where the overlap support is.
Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Everest Fortune Group’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Everest Fortune Group.
