Shanghai copper is expected to break a support at 38,050 yuan per tonne, and fall to the next support at 37,590 yuan, as it could have completed a rebound from the August 19 low of 37,960 yuan.
The rebound only briefly extended above 38,510 yuan, the 61.8 percent Fibonacci projection level of an upward wave C which started at the August 7 low of 37,310 yuan.
The current consolidation below the support suggests copper may retest the support at 38,050 yuan, the 38.2 percent level.
A break above 38,510 yuan, however, will lead to a gain to 38,790 yuan, the 76.4 percent level.
Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
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.