Copper is making a comeback
The base metals market is returning back to somewhat normal levels after the trade war rhetoric between the US and China cools.
China are off today for a public holiday but this week copper has moved off its lows to get back above the $2.60/lb level.
The US and China seem to be playing nice leading into the October talks. China have said this week they are willing to buy American agricultural products including soybeans while there are market rumours in the US that there may be some kind of interim deal put in place until a full deal can be drawn up.
Copper has been severely affected by the trade war. Price action in the red metal has led prices to fall from a high of nearly 3.30/lb to last weeks low of $2.47/lb.
Now the price has consolidated and traders are holding prices near $$2.65/lb in the COMEX contract. If this new round of talks collapses expect a move back down to the lows. This time may be different though as both sides seem to making concessions leading into the event.
On the technical front, there is a trendline to keep an eye on marked on the chart. The one thing I really like is the divergence between the RSI and price marked in red. This clearly showed the momentum of price slowing down leading to the price moving higher. The new base floor of $2.47/lb should be considered as the main support level and on the topside lookout for resistance at $2.74/lb.