Copper futures’ bullish correction from the 45-month low of 1.9684 appears to have lost steam as it approaches the restrictive trend line drawn from the 8½-month peak of 2.8819. Further suggesting that positive momentum is wavering is the RSI that has dipped back below its neutral 50 mark and the stochastic lines, which have reversed ahead of the 80 overbought border.
While the MACD, in the negative section, continues to move above its red trigger line suggesting that the price may test the falling trend line, the downwards sloping simple moving averages (SMAs), specifically the 50- and 100-day ones, maintain alignment with the prevailing negative structure.
If the price extends its current losses, initial support could rest at the 2.2424 low ahead of the 2.1769 hurdle. Next, the bears would need to push under the 2.1469 and 2.1311 troughs to spark a plunge towards the 2.0184 obstacle and a retest of the multi-year low of 1.9684.
However, if the bulls manage to steer back up, the 2.3479 recent high could display initial upside hindrance. Subsequently achieving a break above the descending trend line could accumulate buying interest to challenge the 2.3974 inside swing low and the 50-day SMA at 2.4126 overhead. Overcoming these obstacles, the price may rally, finding its next restrictions at the swing highs of 2.5274 and 2.5589 prior to the 100- and 200-day SMAs currently at 2.5753 and 2.5987 respectively.
In brief, the short-term bias still paints a bearish picture below the descending line and the 2.5274 swing high.