Traders take note: Copper just "jumped out the window."
There's a classic Wall Street saying that goes, "The bull walks up the stairs and the bear jumps out the window." Bull markets tend to march higher and higher as money required to boost prices steadily flows in. When at last there are no new buyers, investors can see months and years of gains erased by a fast decline... We're seeing this phenomenon at work in the vital commodity we call Dr. Copper.
Below is a two-year chart of the red metal. Note how copper suffered a huge decline during the 2008 credit crisis. This decline bottomed at $1.30 per pound that December. Copper then staged a huge rally to $3.40 per pound over the next year. But in just the past two weeks, the bear has "jumped out the window" and erased three months of price gains. This decline has also smashed copper's year-long trendline.
Is this incredible copper decline reason "batten down the hatches" and expect the economy to head lower again? Not necessarily. But we can say copper has been punched in gut... and more losses here will at least get us prepared to "batten."
There's a classic Wall Street saying that goes, "The bull walks up the stairs and the bear jumps out the window." Bull markets tend to march higher and higher as money required to boost prices steadily flows in. When at last there are no new buyers, investors can see months and years of gains erased by a fast decline... We're seeing this phenomenon at work in the vital commodity we call Dr. Copper.
Below is a two-year chart of the red metal. Note how copper suffered a huge decline during the 2008 credit crisis. This decline bottomed at $1.30 per pound that December. Copper then staged a huge rally to $3.40 per pound over the next year. But in just the past two weeks, the bear has "jumped out the window" and erased three months of price gains. This decline has also smashed copper's year-long trendline.
Is this incredible copper decline reason "batten down the hatches" and expect the economy to head lower again? Not necessarily. But we can say copper has been punched in gut... and more losses here will at least get us prepared to "batten."
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