Copper price appears set for its biggest weekly gain since February 2021 after rounds of positive data from the US and China pumped up expectations of a quick recovery of the global economy.
This Friday, China recorded its largest GDP growth on record, as it clocked an 18.3% GDP growth, which matched expectations and far exceeded the previous quarter’s growth of just 6.5%. Only a decline in industrial production from 35.1% to 14.1% has capped copper price performance on the day.
However, there are expectations that copper prices would get further uplift from the commencement of the traditional construction season in China this second quarter. Consequently, Goldman Sachs has raised its projection for copper prices to $11,000/ton. Copper prices are up 3.94% for the week, despite Friday’s 0.49% slump as of the time of writing.
Technical Levels to Watch
Friday’s decline is a pullback test of the violated resistance at 4.2015. This price level has undergone role reversal to become new support and needs to stay intact for the breakout to be deemed complete. This may then open the door for bulls to mount an assault on the 4.2755 resistance, with 4.3995 coming in as a new resistance target.
On the other hand, if the price drops below 4.2015, then the attempted upside break is rendered invalid. This could lead to a further retracement that targets the triangle’s upper border at 4.1275, with downside targets at 3.9970 and 3.9535 also staying in the picture.