Copper, Copper … is this the topper?

 

Copper is forming a 30-month descending triangle

 

The monthly and weekly graphs below display a possible descending triangle in Copper dating back to the late 2011 low or mid 2011 high, depending upon how the upper boundary is drawn. A decisive close below $3.00 would complete this pattern and generate a target as low as $2.04.

An immediate completion of this descending triangle top raises an important question about trading psychology. Should Copper close decisively below $3.00 this week (let’s say we get a $2.95 close), how difficult would it be to short Copper following a straight-line 25 cent decline? If you are like me, I would say that shorting a 25-cent decline would be a difficult trade to execute. Yet, often times the most difficult trades to enter become the most profitable trades.

 

3.10_HG_monthly 3.10_HG_weekly

$HG_F, $JJC

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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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