CHART: Copper Less Optimistic Than Stocks
Copper is often referred to as “Dr. Copper” with a Ph.D. in economics due to the metal’s ability to foreshadow future economic outcomes. Copper tends to confirm lasting bottoms in stocks. For example, copper bottomed in the fall of 2008, several months before stocks bottomed. Note the extremely bullish volume on the bottom right of the chart below.
Compare the bullish read from copper in late 2008/early 2009 above to the present day chart of copper below. Copper remains in a downtrend. Copper tends to be a big winner after a lasting bottom in stocks. Today’s trading volume on JJC, the copper ETF, is on pace to cover only 50% of the volume seen on a typical day. If there was confidence in the current rally, the interest in copper would be much greater.
*Post courtesy of Short Takes.+7
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