Chart study — Copper

Doubtful symmetrical triangle is now leaning toward being a bull trap

The symmetrical triangle in Copper has been commented upon by most chart readers in recent weeks. I have commented upon it as well — questioning its validity because of the number of contact points.

My experience is that the power and legitimacy of a continuation symmetrical triangle becomes increasingly questionable the longer the triangle delays and the more contact points it creates.

The ideal triangle has only four contact points prior to the continuation of the trend. The triangle in Copper had eight contact points. This is an indication that the triangle had lost all the power a triangle should have.

The breakout today quickly reversed when the precious metals turned lower, creating a possible one-day reversal pattern. While this triangle may still work itself out, I have great doubt that a strong upthrust will occur.

In fact, it may be that the breakout today proves to be a bull trap of significant degree. This will be verified if the triangle does an “end around.” Failure patterns often have more power than completed patterns.

Markets: $HG_F

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