Copper Outlook for July 2012 (29 October 2012)

Technical Observation On weekly basis (week ending 26/10/2012) Copper closed 2.09 % down at 425.95 levels after making a high of 434.80 and low of 421.30 levels. It must be noted that last week Copper sustained well above important support of 421 levels. On close examination of long term weekly chart of Copper, it was found that it is moving below the lower part of the lower channel of the Andrews pitch fork since quite long. The Andrews pitch fork was drawn from the low of 284.10 (week ending 12/06/2010), high of 466.20 (week ending 12/02/2011) and low of 332.35 (week ending 08/10/2011). It was also found trading in between a channel drawn from the high of 416.70 (week ending 03/12/2011), high of 434.65 (week ending 11/02/12) and low of 332.35 (week ending

08/10/11). It seems that Copper will find support at lower part of this channel around 415 levels in the month of November. On weekly basis Copper was found trading below its 20 weeks SMA around 429.15 levels, above 50 weeks SMA around 422.04 levels and above its 200 weeks SMA around 356.49 levels along with fall in volume which was below its 20 weeks SMA. Momentum oscillators are indicating that copper on weekly basis is trading in over sold zone. Technical Conclusion For the month of November 12 Copper 415/421 levels zone will be very crucial. Sustaining these zone will force copper towards 540 levels and above while breach of this levels will drag towards major support zone of 299/387 levels. However, probability to sustain 415/421 levels zone seems to be high with target of 444 levels in month of November. Analysis of Monthly Price, OI and Volume for Copper (data as on week ending 29th June 2012) The Data: After the end of fourth week Copper closed 2.09 % down along with 18.77 % fall in volume and rise in open position by 4.11 %. Interpretation of Data: Copper fall with fall in volume and rise in OI suggesting that the market is an indication that a sharp rally against downtrend will develop creating a sell point for downtrend. Fall in Copper with rise in open position on W-o-W basis suggests that the current fall of 2.09 % in Copper was mainly due to fresh short builds up in October 12 future contracts. Implication of the Interpretation: Continuation of fresh short builds up in first week of November 2012 will allow Copper to break 421 levels zone but may sustain above 415/510 levels zone. Further fresh short build up along with initiation of long liquidation will only drag Copper below 410 levels zone whose probability seems to be low. On the other hand initiation of short covering along with fresh long builds up will keep afloat Copper well above 421 levels and may force it towards 444 levels or even above it.