Copper, already heading for a third straight monthly gain, may reach the highest price since April in the next few weeks, according to technical analysis by Matt Zeman at Kingsview Financial.
The metal’s 15-day moving average rose above the 30-day average on Jan. 16, signaling more gains, Zeman, a Chicago-based strategist, said in a telephone interview. Prices are also trading above the 50-day moving average, another bullish indicator, he said. Copper may reach $3.90 a pound by late February, he said. That would be 5.3 percent higher than yesterday’s closing price of $3.705.
The last time the 15-day average crossed above the 30-day was on Dec. 3, and prices rallied for two weeks. Futures for March delivery slid 0.2 percent to $3.6975 at 9:19 a.m. on the Comex in New York. Through yesterday, the metal was 1.4 percent this month on signs of improving U.S. economic growth.
“We need to see a few more clear-cut closes above $3.70, but if the data continues to look good, copper should keep pushing higher,” Zeman said in a telephone interview. “We’re seeing higher lows, and that’s a bullish scenario.”
The metal will meet “resistance” between $3.80 to $3.83 before reaching $3.90, Zeman said. Resistance refers to an area where analysts anticipate orders to sell.
In technical analysis, analysts study charts of trading patterns and prices to predict changes.
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