The price of copper could accelerate its decline to $3.0
In terms of technical analysis, the fall in the price of copper to a low of more than a year, below $4.0, reinforces the underlying trend which became bearish in May following the fall below the moving average at 50 weeks. The price of copper thus exited from the bottom of its range in which it had been oscillating since the beginning of last year, which opens the way to a possible correction to $3.0.
With more and more leading economic indicators deteriorating sharply, such as ECRI’s Weekly Leading Index, copper’s downtrend is likely to accelerate over the coming months as recession fears grow. .
The outlook would turn bullish again in the event of a rebound above the 50-week moving average. A bounce above it would also be a positive signal for equity markets.
Admission: Sale under $4.0
Risk/reward ratio: 5
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