Price action in Copper climbed to its highest point since last four weeks. Unexpected miss in May’s US jobs data pushed back expectations of FED rate hike. MCX copper followed the same route. Technically, Price action is testing the important resistance level at 2.125 again.
Below is the 4h chart of copper with price action analysis
1. Structural Mark down phase
Price action was in Mark down phase from May 1 – May 16. There are clues within the structure which indicated the weakness in down trend. One important factor is to consider that higher time price action on daily chart. Checkout the Copper Price action on daily chart
2. Difference between retracement (corrective pullbacks)
Corrective pullbacks are often seen in mature trends. In this case corrective pullbacks indicated the behavior of buying pressure and momentum within the trend. When trend legs started to become weak, market pressures slowly made a structural shift into range.
3. Dynamic support level and trapped traders
Support zone at 2.060-2.050 was tested, broke and regained strength. (Please look at the chart – Point no. 3) Such kind of structural support levels are called as dynamic levels. Price action break these levels to trap and shakeout weak hand players, later regains the strength around same level or zone.
4. Breakout failure at 2.120
Market tried to break the resistance level 2.120 in the beginning of June. Unfortunately the break was unsustainable as price action met with strong selling pressure. The resulted formation was breakout failure at 2.120.
5. Price action once again testing the resistance level 2.120.
Previous attempt resulted in breakout failure. But buyers are not giving up, at least for now. Price action made another strong push above resistance zone in the beginning of June. The movement itself was impulse climatic pattern and from intraday charts these are clearly perceived as climaxes. Traders should watch how price behaves now and closely monitor the clues of buying and selling pressure. Resulting price action can form trading setups.
