SINGAPORE: LME aluminium may retest a support at $1,733 per tonne this week, probably after a moderate bounce to a resistance at $1,779.
The support and the resistance are identified as the 61.8% and the 23.6% projection levels of a downward wave c, the third wave of a presumed three-wave cycle from $1,866.
Two hammers forming on Aug. 30 and Aug. 29. They indicate the support at $1,733 may hold for a few days. Aluminium has to bounce towards a falling trendline first before retesting the support.
A break below $1,747 could be the early signal that the bounce is over.
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*** Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
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