A Reprieve? September 6th, 2019 by John Gross
Well, it looks like it – as base metals somehow, someway managed to get back above the waterline.
Before you go any further, take a gander at the Copper Bar Chart – clearly, this falls into the category of ‘The Mysteries Of The Markets’.
Just last week we were lamenting the break of a key support line, that technically would suggest the market would continue falling.
But, lo and behold, Big Red turned on a dime, and managed to not only get back over the broken support line, but is also testing the 10 week moving average.
More interestingly / importantly, note the dotted line connecting low points. On May 12, 2017, the weekly low on our ‘Adjusted Spot Copper Bar Chart’ (that is the trading range of the active month superimposed on the Spot close) was $2.4645. The low last week was $2.4665.
Ya can’t make this stuff up.
Anyway, other than the renewed potential of trade talks in October, there wasn’t much else we are aware of that would prompt this near miraculous move.
And copper wasn’t alone in moving higher against all odds, as the rest of the crew also held their own during the latest period.
Perhaps this was just a ‘short covering rally’, or maybe there is more to the move that the market has not yet reveled to us mere mortals.
Whatever it is, caution is still warranted as the danger still remains on the downside.
View Charts (PDF)