SINGAPORE: LME aluminium would rise to $2,315 per tonne over the next three months, as a short-term uptrend from the Aug. 16 low of $1,827.25 has not completed.
This trend will partially reverse a preceding downtrend that developed from the May 3, 2011, high of $2,803 to $1,827.25.
Two waves labelled a and c will drive the trend up.
The wave a has completed around $2,200, the 38.2 percent Fibonacci retracement on the fall from $2,803 to $1,827.25.
The wave labelled b will react to the uptrend, and is expected to end around a support at $2,058, the 23.6 percent retracement. This support has been enforced by another one provided by the trendline descending from $2,803.
The wave b drop could also be viewed as a pullback to the trendline.
The $2,057 level sits on the 38.2 percent retracement of the wave a, which rose from $1,827.25 to $2,199, a break below which will lead to a moderate fall to $2,013, the 50 percent retracement.
The wave c will soon take over to push aluminium towards $2,315, a 50 percent retracement.
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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