Copper continues to press higher and its run upwards since the third week of February is proving to be dramatic. After achieving a price of nearly 4.3765 on the 24th of February and then stumbling to a low of approximately 3.8500 in fast market conditions on the 5th of March, the commodity has shown an ability to climb. The price of the commodity as of this writing is hovering near 4.5000.
Having broken through resistance yesterday near the 4.3800 juncture, copper has climbed quickly and, as of this writing, via its COMEX pricing the commodity now has ten-year highs within its sights. It is not only equity indices and cryptocurrencies which are experiencing a large groundswell of exuberant buying; the commodity world has seen physical assets rise in value too in an exuberant manner.
Technically, copper is now traversing near values last seen in July of 2011. Copper is an important industrial metal and, while the commodity is certainly near technical highs, which some skeptical traders may view as a potential area to look for reversals lower, copper may also prove it has the ability to continue to find speculative buyers. Traders are reminded to consider that buyers of copper may be looking at the metal as a speculative asset, but many participants in the market may also be buying the commodity based on need.
If market participants are buying copper via its physical contracts, it is possible they are buying future supplies via trading contracts to lock in prices now which they may feel will be more expensive moving forward. Like other financial assets, copper has a tendency to find technical resistance areas difficult to overcome because of psychological reasons due to human bias, but if the 4.5500 juncture begins to prove vulnerable, traders will need to be prepared for even more volatility.
Copper is traversing values near record highs, and if the 4.5500 resistance level crumbles, traders may suspect values near the 4.6000 level can be anticipated. Traders should be careful with the amount of leverage they use when trading copper and find out what the overnight carrying charge is for trading the CFD. Copper is within the midst of a strong bullish run. Yes, it can certainly experience reversals lower, but current support levels look like good places to launch long positions for conservative speculators.
Copper Short-Term Outlook:
Current Resistance: 4.5350
Current Support: 4.4720
High Target: 4.5600
Low Target: 4.4340
