Copper May Climb to as High as $8,000 a Ton: Technical Analysis
By Agnieszka Troszkiewicz - May 20, 2013 1:59 AM ET
Copper may rise almost 10 percent to as much as $8,000 a metric ton if it climbs above May’s high of $7,480, according to technical analysis by Marex Spectron Group.
The attached chart shows that copper last week held above the 50 percent retracement of a rally from about $6,762 a ton on April 23 to $7,480 on May 8, signaling prices may rebound back to this month’s peak, according to Justin Froome, a broker at Marex Spectron in London.
“A confirmed move above $7,480 would increase the odds of a move to $7,645 and possibly even $8,000,” Froome said by e-mail May 17. Purchases by commodity-trading advisers to close out bets on declines may accelerate the move upward, he said.
Copper for delivery in three months traded at $7,290.75 a ton by 6:56 a.m. on the London Metal Exchange. Prices climbed 3.3 percent this month amid so-called short-covering by traders after the metal dropped to the lowest price since October 2011 last month.
In technical analysis, investors and analysts study charts of trading patterns and prices to predict changes in a security, commodity, currency or index.
