• 287 days Will The ECB Continue To Hike Rates?
  • 287 days Forbes: Aramco Remains Largest Company In The Middle East
  • 289 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 689 days Could Crypto Overtake Traditional Investment?
  • 694 days Americans Still Quitting Jobs At Record Pace
  • 696 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 699 days Is The Dollar Too Strong?
  • 699 days Big Tech Disappoints Investors on Earnings Calls
  • 700 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 702 days China Is Quietly Trying To Distance Itself From Russia
  • 702 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 706 days Crypto Investors Won Big In 2021
  • 706 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 707 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 709 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 710 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 713 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 714 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 714 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 716 days Are NFTs About To Take Over Gaming?
What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

How Millennials Are Reshaping Real Estate

How Millennials Are Reshaping Real Estate

The real estate market is…

Trading On The Mark

Trading On The Mark

Trading On The Mark

Our work is grounded in several technical methods. We make use of Elliott Wave, Gann techniques, Fibonacci relationships in price and time, cycles, and other…

Contact Author

  1. Home
  2. Markets
  3. Other

There May Be a Trade Nearby in Copper

Since we first wrote about it in December, we have been watching a beautiful example of a b-wave triangle develop in copper. In February, it presented traders with a fantastic opportunity to enter short with minimal risk. For readers who took advantage of the trade, we provided updates in March and May that also can be useful in understanding how the pattern developed.

While we don't think the big trade is nearly finished, there may be another opportunity to get onboard somewhere near the present area.

On the monthly chart below, you can see how copper broke downward out of the big triangle and has approached the first support area. We believe the bounce from that area probably represents wave (ii) of what should become a five-wave move into lower support.

Copper - Monthly

This makes sense in the larger picture. First, the price of copper is widely regarded as a bellwether of economic activity, especially in countries such as China, that are experiencing rapid development of industry and infrastructure. The decline during the first half of 2013 coincides with diminishing expectations for growth in China and elsewhere.

Second, as readers who have been following our posts about the U.S. Dollar might have noticed, consolidation in copper happened at the same time we saw consolidation in the Dollar. We have described our expectation that the Dollar Index will find support near its current level and will climb upward in coming months. That would almost certainly correspond with a renewed bearish trend for copper.

On the weekly chart, copper's consolidation fits well with the idea of an upward wave (ii). If that is the case, then we should soon see a strong downward wave (iii) into one of the support areas shown, 2.65-2.76 or 2.10-2.18.

Copper - Weekly Chart

Of course, there are some caveats. Even if the recent upward move was part of wave (ii), it would be possible for the retrace to extend higher. A wave (ii) also could extend farther in time. Thus, a trader who enters near the present area would need to allow for wider stops than the trader who entered nearer the upper boundary of the triangle in February.

 


There is much more of this kind of information about a wide range of traded markets at Trading On The Mark. Come see for yourself how much more profitable you can be when you see the trades ahead of almost everybody else in the market. We offer two subscription levels -- one tailored to the occasional swing trader, and another for more active professional and day traders.

Visit TOTM go get guidance about the markets, have your questions answered by experienced traders, and fill in the missing pieces of your successful trading plan!

Trading futures and options involves the risk of loss and is not suitable for all investors. Nothing in this article should be construed as a recommendation to buy or sell financial instruments.

 

Back to homepage

Leave a comment

Leave a comment