Death cross on copper

The death cross pattern is a moving average cross over pattern that has a very peculiar name due to the fact that the pattern has negative implications for the underlying asset in mid or longer term. The pattern has better chances of success on the daily chart. The pattern is confirmed when the 55 day moving average (purple line) crosses below the 200 day moving average (blue line). The cross is indicating us that the trend has reversed to the downside and the price may continue falling. At the same time we must keep in mind that when the cross happens, the price of the asset is already over-extended to the downside and probably ready for a correction. In fact, there is a 50% chance of seeing a pullback after a death cross is confirmed. The price of copper pulls back form the 270.00 zone to the 283.62 area where we can find the 200 week EMA. The price may continue falling, but the 270.00 level may act as a temporary support. However, if the price breaks below the 270.00 level, the bearish momentum may accelerate even more.