June 22 (Reuters) – U.S. copper futures have been treading water since early May, but don’t mistake stillness for stagnation. Beneath the surface, the chart is quietly building a case for a resumption of the metal’s long-running rally.
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Copper has remained supported by longer-term demand themes tied to artificial intelligence and the energy transition, and U.S. policies have also affected the price. Those forces helped push futures to a trend high of $6.7160 per pound on May 13, according to data supplied by LSEG, but the market has since shifted into a lower gear.
That pause is actually meaningful to chart watchers. The daily chart of copper futures is forming what technical analysts call a bull pennant, a pattern defined by two converging trend lines drawn from the highs and lows of a consolidation period. Think of it as the market catching its breath after a sprint. The pattern typically resolves with a renewal of the original upward move.
For the pennant to play out cleanly, copper would ideally push back up to test the upper trend line near $6.70, pull back once more, and then break through it convincingly. A failure to hold the lower trend line — which sits in the $6.14-$6.17 range — would undermine the bullish case entirely.
The consolidation is also giving a key momentum gauge, the Relative Strength Index, or RSI, a chance to cool down. RSI measures how quickly prices have been moving in one direction; it had become “overbought” around the May 13 peak, signaling the market may have moved too far, too fast. A reset here would give any rally a healthier foundation. If the bull pennant resolves as the pattern suggests, the technical target using a “measured move” — which assumes the next leg up mirrors the last — points to $7.40-$7.50.
What the chart shows:
(Daily markets commentary from Reuters analysts on the signals financial charts are sending – and what they might mean.)
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