• ALU
    2243.47 USD -2.23%
  • RICE
    18 USD -1.75%
    74.17 USD -1.32%
    14.35 USD -0.66%
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    2.27 USD 0.27%
    256.22 USD -1.15%
    70.04 USD -2.02%
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    23.96 USD -0.14%
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    2010.5 USD 0.48%
  • XCU
    3.73 USD -1.34%
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    1478 USD -0.78%
  • XPT
    1048 USD 0.64%

XCU/USD statistical and technical analysis

The current price of XCU/USD - Copper Spot US Dollar is 4.0785 (March 26, 2021). This commodity is currently trading close to an important psychological level. Such a high price was here even after the GFC. Therefore, we will look at statistical and technical analyzes.

Based on a long-term analysis of historical data, the average positive and negative daily returns are approximately 1.25% and -1.20% , respectively. Friday´s return was 2.35% , which is more than the 1st standard deviation . Our scoring is currently neutral (0 ) for the month-on-month change and -2 for price indexation. Both scorings range from -3 up to 3 . Indexation is currently at the same levels as in the beginning of 2021 . Bulls need to see the cycle change upwards. The estimated cycles development based on our analytical systems is shown in the following chart.

Copper price indextaion and estimated cycles Source: WALFIR

Different moving averages (MAs) help us better identify trends across multiple time frames. We use 3 basic MAs to find out which sentiment dominates each horizon. The purple line represents the monthly , the green line the 6 months and the yellow line the annual moving average. The XCU/USD is in bearish sentiment in the case of monthly MA, after falling below it in recent days. As we can see in the chart below, the 6 months and annual MAs support bullish sentiment.

Daily price and periodical change Source: WALFIR

There were more upward trends, with the maximum level reaching 11 consecutive days, after a large decline also due to COVID-19 . Downward trends did not exceed more than 2 days in the same period. The most negative trend in the last 3 years reached 12 consecutive days just before the decline of global markets in 2020 . We could use the average annual ATR (Average True Range) obtained from daily data (1.75% ) to estimate Stop Loss orders for our positions. The current value is 2.80% . Approximately 90% confidence interval (return between -2.5% and 2.5% ) is shown in the histogram below by a red rectangle. We could use the last decile of low to high returns (3.00% ) to estimate Profit Targets, as shown in the second chart below.

Daily return distribution Source: WALFIR Daily low to high distribution Source: WALFIR

The basic technical analysis shows a slightly negative sentiment for the last month. The XCU/USD is currently very close to the psychological level of 4.00 . In addition, the shorter-term MA has also recently been very close to the spot price. The divergence between price development and RSI motivated short-term bears at the end of February. The demand zone (green rectangle), where the Fibonacci retracement level of 38.20% is also, could be a strong support in the event of a further decline.

Basic technical analysis Source: TradingView

WALFIR Technologies is one of the three divisions of WALFIR s.r.o., which is based in Slovakia. The primary interests of this division are analytical, quantitative, and algorithmic...


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