MCX Copper formed an ending diagonal (blue) and broke on the downside. The daily momentum indicator that was showing a negative divergence triggered a bearish crossover. Consequently Copper has fallen sharply. It has formed an impulse in the fall, which indicates that it has entered a bearish phase from a medium term perspective. Currently the base metal is forming a retracement of the impulse, which should be used as a selling opportunity.The swing high of Rs423 is a key resistance; beyond that the 40 day exponential moving average (DEMA; Rs424.5) and the 20 day moving average (DMA; Rs426.5) are there to hammer the price. The short term targets on the downside are Rs407.8 – 403.5.
