SINGAPORE: Shanghai copper is expected to end the current consolidation within a triangle soon and fall to 44,650 yuan per tonne over the next three months.
The metal is riding on a downward wave (C), as part of an (A)-(B)-(C) corrective wave cycle that started at the 2006 high of 85,500 yuan.
A Fibonacci projection analysis of the wave (C) target points to 44,650 yuan, the 50 percent level, with a possible extension of the downside to 37,180 yuan, the 61.8 percent level.
After touching a low of 50,760 yuan in October, copper has been consolidating within the triangle, which is presumed to be a continuation pattern.
The pattern is expected to be followed by a resumption of the preceding downtrend towards 44,650 yuan, as indicated by the lower channel line of a falling channel.
Resistance is at 58,700 yuan, a rise above which may extend to 62,100 yuan.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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