“Woe to the land whose king is a child and whose leaders are already drunk in the morning. Happy the land whose king is a nobleman, and whose leaders work hard before they feast and drink, and then only to strengthen themselves for the tasks ahead”. (Eccl 10: 16-17)


"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat


Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


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Monday, September 26, 2011

Copper Bottoming?

Copper often seems to function as a type of bellwether for the entire commodity sector. As fears of a global economic slowdown have intensified, copper prices have been hammered lower. Chinese buying just below the $4.00 level had kept the market supported but once that evaporated, there was a general dearth of buying. That allowed the bears to press the price into downside sell stops which have then fed on themselves.

However, there are some preliminary signs that the bleeding in copper might be coming to an end. The red metal seems to have found support just above the $3.00 level; a level closely corresponding to horizontal chart support and just a tad above the technically significant 50% Fibonacci retracement level of the rally off the 2008 low and the peak early this year.

The chart damage has been severe however so it is going to take further work to repair both the technical picture and the mental state of some of the badly bruised bulls. The spike off of support is a first step but we will need to see some confirmation for the remainder of this week.

If this is the case and copper has bottomed, it will serve to stop the rampant selling in the silver market. Some of that might be showing up today as silver has put in a massive spike off the $26 level.

11 comments:

  1. Hi Dan, thank you for your posts as they are alway something I look forward to reading. My intuition is telling me that gold and silver have bottomed with the blowoff bottom that occurred in late Asian trading today. The gold/silver ratio 1 hour charts is looking like a parabolic top occurred also. I am a bit angry that the superb opportunity to buy more gold and silver coins came and went while I was sleeping. Oh well....

    ReplyDelete
  2. Thank you Dan,
    Always grateful for sharing of wisdom and brilliance.
    God Bless!

    ReplyDelete
  3. I was around in 1980 and then again in 2008, but this silver decline will go down as the biggest wipeout of longs in history. When it takes out 50, which it will, there will be people jumping off buildings because they will look back on this time wondering where their silver is. That will be sad. Because if you do this right, have the proper discipline, its the greatest business in the world. Done wrong, there is no hope. As I always say, Dan is a prince of princes, and is always appreciated.

    ReplyDelete
  4. wow doggey that's a big hammer. Dan love your post look forward to them. checked your site like 5 times today trying to get insight and you were posting more than usual. NICE!

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  5. Thanks for the kind words to all
    Dan

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