Let’s begin with a quick reminder from last week’s Lab:
“(…) What would invalidate the bearish scenario? A daily close above 650.(…)”
Despite intraday volatility, buyers managed to finish Friday above 650, closing the bearish gap and invalidating the previous bearish scenario (that alone was another reminder of how important daily closes are compared to intraday noise).
Monday added another bullish gap (651-655), which successfully absorbed selling pressure and confirmed that buyers remain committed to higher prices.
The market responded quickly.
Copper broke above the orange consolidation and activated the bullish scenario we discussed on July 21, bringing our previously projected upside targets back into play. As a reminder:
“(…) If buyers can finish (…) session above 649.35, the odds of breaking out of the green channel increase significantly, opening the door toward the upside targets we discussed last week: 675.43 (161.8% Fibonacci extension) and potentially the 692-700 zone (…)”
Today, buyers hit a new high at 685.90, successfully achieving both the minimum measured move from the recent consolidation breakout and our first above-mentioned upside target.
The recent rally has triggered a modest pullback as traders take profits, however, as long as copper remains above the 669-671 support zone (the previously broken peaks) and the upper boundary of the green ascending channel, further gains remain possible.
The next upside target continues to be the 692-700 area.
Nevertheless, a daily close below 669 would be the first signal that a deeper correction may be starting.
Today’s Takeaways
Dollar (DX.F)
- 100 & the 100.14-100.32 resistance zone are key.
- Buyers need a daily close back above 100 to invalidate the recent breakdown.
- Until then, sellers remain in control despite this week’s rebound.
Platinum (PL.F)
- The 1736-1792 bearish gap remains the key resistance.
- A daily close above 1792 opens the door toward 1824-1848 and potentially 1900.
- Buyers remain in control while price stays above the green ascending channel.
Palladium (PA.F)
- Monday’s defense of 1250 keeps the bullish scenario alive.
- The next resistance zone around 1388-1430 & support area around 1310-1325 deserve attention.
- The next upside target -> 1430.
Copper (HG.F)
- Here we watch the 669-671 zone.
- As long as price remains above it, the next upside target stays at 692-700.
- A daily close below 669 would be the first warning that a deeper pullback may be underway.
Anna