copper and nickel, page-7

Copper about to breakout? - Clive Maund
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Although this is a Gold Market update, it is worth taking the time for a sideways look at copper here, as it may be on the verge of breaking out to new highs, which if it does should lead to a spectacular ramp, which will have major implications for other commodities and markets generally. On its long-term chart we can see that a huge top formed in copper from 2006 through 2008, which was followed by a dramatic plunge as the 2008 financial crisis hit. It then quickly recovered last year but earlier this year looked like it was forming a huge Double Top with the earlier highs. Now given that it is highly unlikely that copper will turn tail and drop in the near future while gold and silver are forging ahead, and that copper has been banging repeatedly up against the broad strong band of resistance approaching the 400 level no less than 5 times now, it is looks very probable that it will bust through this resistance soon, which would be a major technical event that would be expected to lead to a powerful advance, and with its MACD indicator close to neutrality there is certainly scope for such a move. In the light of these observations it is interesting to learn a mystery trader has captured 80% of London's copper market in recent weeks . The stocks of copper mining companies can be expected to do very well on such a development, which will probably lead to a "phony recovery" phase ahead of possible hyperinflation.



On its 6-month chart we can see that until a few days ago it looked like a Head-and-Shoulders top was forming in copper, but the sharp rally on Wednesday negated that pattern. Although a littlec overbought short-term copper is now in position for a major breakout.



End of report.