Copper has recently reached new highs, but one of the wave counts we are tracking suggests that the upside could become limited. We are observing a potential ending diagonal, which is a pattern that typically shows that bulls are still in control, but are gradually losing strength. This is also reflected by the increasing number of overlaps since the beginning of this year.
You can clearly see the difference between the strong and steep advance from the August 2025 lows into the January 2026 highs and the much slower rise from the 5.27 swing low. This loss of momentum is also supported by the bearish RSI divergence and suggests that sooner or later the trend could change. If a reversal develops from an ending diagonal, the decline can be quite sharp. A break below the rising 50-day SMA, currently around 6.50, would be an important bearish signal and could open the door for a much deeper correction later on.
Trade well,
Grega
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