Aluminium is heading towards historic support in and around the 1,430/40 area.
The short-term trend is up, but the current recovery still appears to be corrective in structure and hence unlikely to prove sustainable at this stage. Expect resistances waiting at 5,100/20 initially then at 5,180/5,200 to restrict upward progress with this market remaining vulnerable to renewed bouts of weakness in the days ahead. Local support should now be anticipated starting in the 4,900/20 area then again towards the pivotal 4,740/60 region with a market close beneath here needed to regenerate downward momentum and set up a retest of the recent lows around 4,370. Note: An extended period of basing will be required ahead of more significant gains being secured.
Trading strategy: Monitoring current corrective phase for opportunity to re-establish shorts.
Overall technical studies remain clearly bearish and while this major downward cycle looks to be entering its latter stages there is little evidence of a bottom yet. The historically important 1,430/40 area could come under serious examination in the days ahead and while a sustained break beneath here would encourage further losses, good support should certainly be anticipated in this region. However, immediate recovery attempts are expected to be restricted to unsustainable corrective bounces only for the time being with an extended period of basing required prior to any substantial and sustainable advances being secured.
Trading strategy: With prices now approaching potentially good support would take profits on any remaining shorts.
Intermediate- to long-term downtrends remain firmly intact but interim downside objectives have been fulfilled with much-needed corrective and reconsolidative action being experienced now. However, in the absence of any significant basing activity immediate recovery attempts are likely to prove unsustainable with strong overhead resistances waiting at 1,970/80 initially, then at 2,050/60 likely to cap gains for the time being. This market remains vulnerable to renewed bouts of weakness in the days
ahead and while local support should be uncovered in the 1,830/40 zone a break beneath here would signal 1,760/70 next.
Trading strategy: Remaining on sidelines for the time being as corrective/consolidative phase continues for now.
Intermediate- to long-term technical studies remain clearly negative with lower targets still possible. However, interim objectives have been fulfilled with a fresh period of correction and reconsolidation developing now. With immediate weakness uncovering good support starting in the 1,630/40 area a fresh test of local overhead resistance in the 1,750/60 region is now anticipated, which if decisively breached, would extend near-term gains closer to the 1,810/20 zone where better supply should then be stimulated. A clear and sustained break beneath 1,630/40 is now needed to put prices under fresh
downward pressure and set up a retest of 1,570/80.
Trading strategy: Continuing to utilize corrective rebounds to probe the short side.
The overall bearish outlook remains firmly in force with little evidence of any bottom to this major downward cycle yet, though short-term trends look to be flattening out with recent falls being digested through a combination of correction and reconsolidation. However, expect immediate recovery attempts to be restricted by resistance on approach to the 11,600/11,700 area with a clear and sustained break above here needed to trigger more serious near-term gains and set up a challenge of the 12,200/12,300 area. Unless achieved further, choppy two-way activity is favored for now with support at 10,500/10,600.
Trading strategy: With profits on shorts secured will await next signal prior to re-establishing.
Overall technical studies remain decisively bearish with little evidence of a bottom to this major downward cycle yet, though prices look to have uncovered good support on approach to the historically important 13,000/13,100 area with much needed corrective action being experienced now. However, while this recovery attempt could challenge the 14,900/15,000 area ahead of meeting too much overhead resistance, gains are likely to prove both unsustainable and short-lived with this market still vulnerable to further bouts of weakness in the days and weeks ahead.
Trading strategy: With profits on shorts secured will await next correction ahead of re-establishing.
Long-term bullish patterns are undisturbed with prices still capable of trending higher in the weeks ahead, but short-term trends have flattened out with a volatile period of correction and reconsolidation being experienced at present. Expect immediate rally attempts to again meet strong overhead resistance in the 1,700.0/05.0 area with a clear and sustained break above here needed to regenerate upward momentum and confirm next targets in and around the 1,735.0/40.0 zone. Local supports are now visible starting in the 1,600.0/05.0 region then again towards the more important 1,565.0/70.0 levels.
Trading strategy: Remaining on the sidelines for the time being awaiting clearer directional signal.
The overall technical outlook remains clearly bearish with lower targets still readable in the weeks ahead. Interim objectives in and around the 11.20/40 area have been fulfilled with sharp corrective action being experienced at present. However, this appears poorly based and hence unlikely to prove sustainable at this stage with strong overhead resistances waiting at initially 15.30/50 then on approach to the 16.00/20 zone. Unless this upper boundary can be regained, prices remain vulnerable to renewed bouts of weakness with support now waiting at 13.70/90 initially, then at 12.40/60.
Trading strategy: Monitoring current sharp corrective bounce for opportunity to re-establish shorts.
The data shown and the views expressed on this sheet are for information purposes only and do not constitute recommendations to trade. Cliff Green Consultancy does not accept any liability for loss or damage suffered through any actions taken or not taken as a result of reading any information provided herein.
Thursday, April 9, 2020 | Tel: + 44 (0)7710369208 | www.cliffgreenconsultancy.com | email: email@example.com