Technical Analysis: 14 June 2019

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
14 June 2019, 11:12 AM

Copper – close to support

In our last update on May 31, 2019 we discussed the implications from the bearish breakout and the likelihood of the price declining to US$2.55 - US$2.60 in the short term. The expected pull back is still in progress and the price appears headed for a re-test of its key support of US$2.55 which is likely to hold in the short term. The weekly and daily momentum indicators are close to oversold territory suggesting that the price is likely to bounce soon.

The initial upside price target is US$2.80.

Nickel – under selling pressure 

Nickel posted a record high in May 2007 and has been trading in a primary down trend since. A strong support was found at US$7,561 in February 2016 and the commodity has been trading in an upward trajectory over the past three years. Despite the strong run seen in recent years, the weekly and monthly conditions remain poor. A lower high has formed in March 2019, suggesting that the recovery from the February 2016 low is likely to take a breather.

Over the medium term, the price is likely to trade sideways between US$10,700 and US$13,200.

Zinc – losing momentum

The up trend from the January 2016 low has lost momentum over the past year and the price of zinc has been trading in a downward trajectory. The up trend line from the September 2018 low has been broken downwards recently showing that momentum is deteriorating.

Although the commodity is oversold on a short term basis, a decline to US$2,450 is likely to unfold before a recovery to US$3,000 takes place.

Lead – approaching a turning point 

Lead has been trading sideways over the past ten years, fluctuating between US$1,530 and US$2,925. The current decline from the February 2018 high is approaching its key support of US$1,530 which appears solid and is likely to hold. A bullish divergence between the price and the weekly RSI indicator has formed on the chart suggesting that the decline is likely to be approaching a turning point. A subsequent break above dynamic resistance of US$2,000 is likely, which would signal further strength to US$2,200.

Over the long term, levels to US$2,400 appear easily achievable.

Tin – oversold 

Tin has been trading sideways over the past two years, fluctuating between US$18,234 and US$22,070. The current downswing has approached its support of US$18,234 where buying interest is likely to arise. The weekly RSI and stochastic indicators have reached oversold territory suggesting that the price is likely to trade higher in the months ahead. 

The potential upside price target is US$22,000.

More information

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Disclaimer: The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents ("Morgans") do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.

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