Copper Prices Break Key TrendlineThe reversal lower in copper prices this year has seen the metal breaking down through several key support levels and through the rising trend line from last year’s lows. Price is currently sitting on support at the 4.1185 and with both MACD and RSI bearish, there is a risk of a further breakdown through that level towards the 3.9555 and 3.7300 levels below.Fears of a slowdown in China, the world’s largest consumer of copper, have added to price pressures in the metal recently. Rising inflation and higher money market rates have also put a dampener on demand for copper and, with US rates forecast to rise sharply in the coming quarters, this theme looks likely to develop further.Keep an Eye OnBroader risk flows, as well as any China-linked news will be key to determining near-term price action in copper. Should risk appetite stay pressured, we are likely to see copper prices move lower still in the short term. Any further data weakness out of China will certainly add to these moves. However, should we see a change in risk tone, particularly if China lockdowns are ended, this will likely allow copper to recover somewhat.
Source: Tickmill
