Copper Forecast Today 02/04: Buyers On Dips (Video)

(MENAFN- Daily Forex)

• Copper futures look a bit soft over the last couple of days after a massive run up, perhaps with some leaked information about potential copper tariffs.
• So that game has come and gone. It will be interested to see how this plays out. We did have a pretty significant bullish flag that broke higher previously.
• The measured move on that breakout was right about where we hit, almost to the penny at $5.30.

So, the question now is whether or not traders will continue to drive copper higher. I think at this point; it's a bit of a mixed bag. don't really know mainly due to the fact that global growth is a little bit threatened, but if we start seeing tariffs everywhere, there brings a lot of pull through people buying copper before they have to pay those tariffs. And that's what we just saw.

So, I do think pullback from here does make a certain amount of sense, but I'm not willing to short copper. And in fact, I'd be very interested in buying it somewhere right at around $4.80. We may have a couple of days before we get down there, but that also has copper meeting up with the crucial 50 day EMA. If we break above the $5.15 level, then I think we just take off to the upside and continue to climb towards the recent highs near the $5.37 level.

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Copper of course is very sensitive to global economy and growth, which right now seems a bit threatened, but it is picking up in places like Germany. So, pay close attention to that. If the tariffs end up being less stringent on Wednesday than people are worried about Trump doing, what you might see initially is copper sell off and then bounce perhaps based on a relief rally and hope of global growth continuing. Anything below the $4.60 level, I think it's disastrous for copper. I don't see that happening, but it is an area to pay close attention to.

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