Friday, March 7, 2014
IKN says copper's the big story today
IKN - screw the BLS, copper is the big story today. This chart looks like the gold chart during the ultimately failed battle for $1500. Take a look:
Multiple bangs against a support level, with lower and lower highs on each rebound and the price spending most of its time below the weekly SMA(50)? Sorry buddy, that doesn't look good.
If copper breaks below $3.10 this time, it might be the last time. The more times you've already banged against support, the weaker each recovery is, the more likely you punch through it the next time.
And when $3.10-$3.00 is broken, what will all the commodity speculators want to do with their copper positions? You think they'll hold them when the chart's broken?
Geez, I wonder if those Chinese copper stores being used as collateral for dodgy shadow banking loans have anything to do with this?
If so, a copper collapse below $3.10 might be a bad omen for gold.