Can Aluminum Break Out?
As geopolitical risks continue to cast a shadow over both equities and commodities, it is essential to recognize the crucial roles commodities play during times of conflict and the potential implications of any escalation on specific commodities.
Aluminum, valued for its malleability, corrosion resistance, and capacity to be intricately machined, finds application in the production of machinery and equipment parts, as well as in the aerospace and defense industries for aircraft components, missile structures, and military vehicles.
China holds the dual distinction of being the largest producer and consumer of aluminum, making China's trajectory a critical factor influencing the industrial metals market going forward.
With the Chinese industrial and manufacturing sector poised for a rebound, the expansion could potentially benefit industrial metals as a whole, such as copper and aluminum.
In terms of technical analysis, aluminum has recently exhibited the formation of an inverse head and shoulders pattern, with the left shoulder ranging from 2090 to 2115, the head at 2075-2078, and the right shoulder at 2165.
To see more buying activity, a decisive break and close above the significant resistance level of 2380-2450 is crucial. Conversely, if the market fails to break and close above this level, substantial support can be expected within the shoulder range of 2090 (left) to 2165 (right).
A break and close below these levels may lead to a test of the most recent lows (the inverse head) at 2075-2078.
Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
Aluminum, valued for its malleability, corrosion resistance, and capacity to be intricately machined, finds application in the production of machinery and equipment parts, as well as in the aerospace and defense industries for aircraft components, missile structures, and military vehicles.
China holds the dual distinction of being the largest producer and consumer of aluminum, making China's trajectory a critical factor influencing the industrial metals market going forward.
With the Chinese industrial and manufacturing sector poised for a rebound, the expansion could potentially benefit industrial metals as a whole, such as copper and aluminum.
In terms of technical analysis, aluminum has recently exhibited the formation of an inverse head and shoulders pattern, with the left shoulder ranging from 2090 to 2115, the head at 2075-2078, and the right shoulder at 2165.
To see more buying activity, a decisive break and close above the significant resistance level of 2380-2450 is crucial. Conversely, if the market fails to break and close above this level, substantial support can be expected within the shoulder range of 2090 (left) to 2165 (right).
A break and close below these levels may lead to a test of the most recent lows (the inverse head) at 2075-2078.
Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
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