Technicals | Sep 27 2011
By Rudi Filapek-Vandyck
Technical market analysts at Barclays Capital in London have been forced to revise their predictions and projections for copper a few times in the weeks past, and this week has once again proved no exception. The problem with copper is that it was supposed to be a solid indicator for ongoing strong demand from China and elsewhere, instead it has proved vulnerable to margin calls and a weakening outlook for the global economy.
Continuous weakness for copper has forced the analysts to review their bullish picture and the expectation is now that we will see much weaker prices. Reports the team: "The downward break in copper signals further weakness toward 6500 before looking for a base over the 6000 area." Note the red metal is at present trading below US$7300/tonne, so Barclays' technical assessment implies a lot more weakness than what has been seen throughout tumultuous September.
Other metals have equally felt downward selling pressure and the team at Barclays suggests that were aluminum to break below US$2155/t, this would confirm the metal is targeting US$2040/t.
Technical limitations
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