Saturday 2 February 2013
The unshiny metal may be outshining its other metal cousins as its price has an upside
breakout. As with any potential move, it remains potential until confirmed by the next
successful retest. This is true for any move in any market. Confirmation is a critical and
overlooked aspect in price activity. While there is no clear correlation between copper,
relative to gold and silver, there is an occasional lag/lead aspect to them, and it may be
that if this upside breakout holds, it can only help gold and silver.
For now, we focus on the breakout to determine the probability of it succeeding. A line
has been drawn connecting swing highs and lows to show higher swing highs and higher
swing lows, the essence of a trending market to the upside. Copper has been trading
sideways since the October 2012 low, but unlike the formations in silver and gold, this
one has a clear triangular pattern to it.
We start with the monthly time frame because it is more controlling than lower times, and
when one sees synergy between the primary time frames, monthly, weekly, and daily, the
odds of a reliable breakout increase. Odds trading, or probabilities is one of the most
important aspects of successful trading. We will do an article on it, soon, but mention it
here because it is so timely for copper.
Sometimes an analysis is easy, just like going through a checklist. You can see the same
pattern formation fits in on the weekly chart. It started from the October 2012 low, while
To read the entire article and see charts, click on http://bit.ly/XPGW2u
