COPPER breaks below 50-day moving average for the first time since December 3, 2019
Copper (COPPER) Technical Analysis Report for Jan 23, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, COPPER finished Thursday at 273.50 losing $3.35 (-1.21%) on high volume. Today's close at 273.50 marks the lowest recorded closing price since December 5, 2019. Closing below Wednesday's low at 276.35, the market confirmed its breakout through the prior session low after trading up to $5.25 below it intraday.
Daily Candlestick Chart (COPPER as at Jan 23, 2020):
Thursday's trading range has been $6.15 (2.22%), that's far above the last trading month's daily average range of $3.82. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for COPPER.
One bearish candlestick pattern matches today's price action, the Black Candle.
The contract closed below the 50-day moving average at 275.84 for the first time since December 3, 2019.
Crossing below the lower Bollinger Band for the first time since August 6, 2019, prices have shown unusually strong downward momentum in the short-term. This could either indicate a potential selling climax after which prices might head back up towards the mean of the Bollinger Bands at 281.61 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on August 1, 2019, COPPER lost -1.95% on the following trading day.
While COPPER is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed below the lower Bollinger Band" stand out. Its common bearish interpretation has been confirmed for Copper. Out of 73 times, COPPER closed lower 58.90% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 52.05% with an average market move of 0.05%.
With one of the other Metal Markets closing higher and one closing lower today, the winners of the day are GOLD surging 0.23%. On the flipside the worst performer has been SILVER closing -0.25% lower. Read more