LME aluminium to retrace to $1,800

SINGAPORE: LME aluminium may have completed a rebound from the Sept. 5 low of $1,785.25 per tonne, or the first round of this rebound, and is expected to drop to $$1,800.

The rebound is against a five-wave cycle starting from the Aug. 22 high of $1,920 and ending at the Sept. 4 low of $1,785. A Fibonacci retracement on the cycle reveals a resistance at $1,837, the 38.2 percent level.

It is obvious that the short uptrend from $1,785 started to reverse when the metal approached $1,837.

A break above $1,837 will lead to a further gain to $1,853, the 50 percent retracement.

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