Close to three weeks ago, Comex copper price dropped past the bullish trendline that had shaped its movements since the start of August 2025. While its long-term demand outlook remains bullish, the ongoing conflicts in the Middle East are clouding the short-term outlook. 

A stronger US dollar and heightened inflation concerns are weighing on Dr. Copper, which is considered a barometer of global economic growth. In the holiday-shortened week, investors will be looking for cues on the state of inflation from the US CPI data ad Fed meeting.  

US-Iran war offsets bullish long-term outlook

Copper price began the year on a high as optimism over global economic growth bolstered its gains. At the end of January 2026, the red metal was trading at an all-time high with Comex futures at $6.57 per pound. Since then, it has declined by about 15%.

On the one hand, the metal’s long-term demand outlook remains bullish. From electrification to renewable energy and AI data centers, heightened demand and supply constraints are set to push the red metal into a significant deficit in 2026. For instance, AI data centers alone are forecast to consume close to 500,000 metric tonnes of copper this year. At the same time, the market continues to face a fragile supply chain. 

Even with this positive outlook, uncertainties emerging from the ongoing US-Iran war have curbed Dr Copper’s upside. To begin with, blockage of the all-important Strait of Hormuz has bolstered crude oil prices to the triple-digit zone. The resultant energy shock has investors concerned over the possibility of a recession and slowed economic growth.  

Besides, the heightened inflation concerns have increased bets against the Fed and other major central banks further cutting interest rates. The hawkish outlook has strengthened the US dollar while weighing on the dollar-priced red metal. 

In the coming week, investors will be looking for cues on the state of inflation. More specifically, their focus will be on the Fed minutes and US CPI data slated for Wednesday and Friday respectively. 

During the latest FOMC policy meeting in mid-March, the US central bank left interest rates unchanged. In his speech, the Fed Chair acknowledged the uncertainties arising from the conflict in the Middle East and its long-term impact on the US economy. Amid the energy shock, the inflation of 2.4% may remain elevated for a while longer. 

Heightened inflation concerns may strengthen the US dollar; rendering the red metal more expensive for buyers holding foreign currencies. Besides, the woes impact its short-term demand outlook. 

Comex copper price technical analysis

Copper price recorded its second consecutive week of gains, even as March’s losses cut its 7-month winning streak. A stronger US dollar and uncertainties emerging from the US-Iran war are curbing the red metal’s upside. In fact, the red metal lacked enough bullish momentum to sustain a rise above the previously steady support zone of $5.70. This places it below the short-term 25-day EMA and the medium-term 50-day EMA. Besides, it is still trading below the bullish trendline that has shaped its price movements since mid-2025.

In the coming week, copper price will likely remain under pressure as conflicts in the Middle East weigh on the short-term demand outlook. It may continue to face resistance along the 50-day EMA at $5.69 in the holiday-shortened week. 

A rebound past that level will likely curb its gains along the point of convergence between the two technical indicators at $5.75. On the flip side, a move below the current support zone of $5.50 is set to activate the lower level of $5.46. 

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