a level seen at previous bottoms in copper. Given the proximity of last week’s low (2.93) to my price target and the explosion of volume in the copper ETF, JJC, I’d say that was the bottom of the decline in copper.”
Since that time the price of copper endured a slow grind upward until encountering resistance at 3.20 (support turned resistance) at the end of May. Last Wednesday copper gapped down 1.65% and, after hesitating at the trendline on Thursday, broke through it on Friday to close at 3.053.
At this point, if copper breaks 2.95 (and that remains to be seen) my price forecasting model will generate a price target as low as 2.62 – 14% below Friday’s close. Copper is known for its ability to forecast the broad economy, hence the moniker “Dr. Copper – the metal with a PhD. in economics”. If copper plunges to new lows, that can’t be good news for the economy.
This article is brought to you courtesy of Ed Carlson From Seattle Technical Advisors.