Posted by: jhamon | July 8, 2009

New Leg Down? Copper Doesn’t Concur – Yet

Dr. Copper is the commodity that has often been said to have a PhD in economics.  Electrical wiring, plumbing and electronics all use copper.  So where copper goes, so goes the economy.

With that in mind, note well this a.m. posting from MysteryHedgie:

Market players worldwide have been dusting off Edwards and Magee’s Technical Analysis of Stock Trends as email inboxes are inundated with references to “Head and Shoulders” tops since  the deflation trade reasserted itself with the price action of the past 24 hours.  While the technicians price targets of SPX 830, WTI Oil $59, Nikkei 225 8900 and EURJPY 124  are all quite reasonable given the catalyst of Obama and Reid’s denial that a second stimulus package is necessary, patience is required to let the thesis play out during July’s expected volatility.  The one “economic barometer” which has yet to “break its neckline” is Copper (see below); continued stability here means the asset markets may take a less direct downward path.            

Dr. Copper's Hanging In Just Fine - So Far

Dr. Copper's Hanging In Just Fine - So Far

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