Courtesy of Jean-Luc Saillard.
Copper has been acting wildly over the next few months – victim to some financial shenanigans in China and an unclear picture of the real demand.
The technical picture is not brilliant! It is trading below the 200 dma (green line) and flirting with both the 15 and 50 dma (red and blue lines). Both are below the 200 dma which is an indication of weakness. I have drawn 2 more studies – a regression channel of 1 standard deviation with dating back to the lows of last June and some Fibonacci lines covering the same period. Copper has been hugging the bottom line of the regression channel (which is still pointing up) and trading between 2 Fibonacci lines at 3.91 and 4.19. The 200 dma is at 4.20 now so going through both lines will not be easy. But as with other commodities, the current political situation could change everything quickly.
As far as indicators are concerned, a lot of them are pointing up now as of last week! For what it’s worth…
