Copper Futures—Copper futures in the December contract is sharply higher this Wednesday afternoon in New York up 500 points at 2.5780 as I’m now recommending a short position while placing the stop loss above the August 13th high of 2.6500 as an exit strategy as the risk is around $1,800 or $900 per mini contract plus slippage & commission as the chart structure is outstanding.
Copper prices hit a 2 1/2 year low yesterday as it is riding the coattails of the stock market today which is also sharply higher as the risk/reward is in your favor to take a short position as I think today is just a kick back due to the oversold conditions.
Copper is still trading under its 20 and 100 day moving average as the trend remains to the downside as the entire precious metal sector is sharply higher once again today as I also have a bullish silver trade at the current time.
One bearish fundamental factor towards copper prices is a weakening housing market as demand for this commodity is weakening at least in the short-term so play this to the downside, however for the bearish momentum to continue we have to break yesterday’s low of 2.4820 as the volatility certainly has increased over the last several days.
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