Copper sector

[bgold]

Copper is still in a clear bull trend but look at the chart of an price index of copper stocks (sum of PD, FCX and PCU - PD has about 50% weight!). Not perfect, but it seems much weaker than the metal.
I see a triple top with several lower lows and highs since.
Volume at tops are weak and rise near bottoms (bottom piucking?). Momentum indicators are weak.

Is there a Head & Shoulder formation?
Seems to be more pronounced in PD (see next posting)

Keen to hear your insight?

 

[bgold]

PD in possible H&S formation?

Very aggressive players short PD here (81.70) with stop just above Shoulder at 85. Others might wait and sell break of neckline 2 (~77'ish if soon).

With an initial target: $65-60, this looks like a reasonable swing return.
(not sure if the $65 target arrow qualifies under TA rules?)

What do you think?

 

[bgold]

Phelps Dodge

PD seemed to have made a temporary bottom on back of impressive copper recovery. Copper trend appears to be still up which will probably delay the PD's slide (?).

I was stopped out at 74.80 for a $7 gain. Can't complain other than that position was just 1/4 size. Will be looking for good short entries nearer to the neckline 2 or even higher.

 

[PeterTT]

mmm not sure I would want to short this one here .. I think the base metals are just ranging here and cannot see them breaking down yet. I am small long copper from few days ago so enjoying this rally! If Phelps went through 70 then I might get more excited about shorting it.

Peter

 

[bgold]

PeterTT, i would agree. I was short from 81.90 down to 74.80.

Copper is either in what what seems to be a contracting triangle wave iv with wave d projecting ~135 and wave e sub~130 in next few weeks. thereafter a wave v (circled) rallly beyond ~142. Or, completed wave 4 and thrust up into wave 5.

As you say, not yet a good time to be short PD.