Copper … interesting

it’s all about the data folks … in this case we have a monthly continuous contract of Copper Futures. the PATTERN into the low back in 1990-2000 (yes it took 10 years to complete .. read that again – 10 years) is hard to understand w/out anymore data to the left of it’s beginning so it’s hard to figure out if the high in 2010 was a big 3 or big 5.

thus, I’m going to outline two scenarios ..one bearish one bullish.

BEARISH: replace the big bright orange question mark w/ a bigger 5. IF that is the case THEN the most recent high was completing a B wave and we have started a C wave down … C waves are freight trains of beauty and a wonder to behold .. leave nothing in their wake. stand by …

now, hold the phone, what if the big bright orange question mark is/was a 3? then, the BULLISH scenario is we just finished wave 3, are correcting wave 4 and copper is a BUY into new highs … it’s still working it’s way thru the corrective PATTERN that will appear so it’s hard to make a projection but we should NOT go below (1) as that will violate a rule …

so, for now, take note of the blue arrows .. the all time high was, yup, an AB=CD staring from May 1999. It smacked right into that …

kind of in no mans land from a count perspective due to data but expect the two red horizontal lines to act as support due to the polarity principle …

Happy Fathers Day …

also, note EEM .. smacked into a nice target zone in/around 58 and the second chart shows the daily sell signal on EEM.

minor EEM sell pattern on the daily …

last, note the synchronicization between copper and emerging markets … pretty nice correlation.

last, note the FXI (china) has NOT made new highs while Copper and EEM have .. below you can see that high/low inflection points are nicely timed by the Chinese ETF …

so, for now, expect copper weakness for the next couple weeks then we can figure out where we might be from a count. if anyone has really long term copper data please let me know.

Bart