Price has barely moved—just grinding sideways in one of the cleanest compression patterns we’ve seen in a while.
That changed today, as we finally got a big rip to the upside.
This could be the starting-line momentum needed to finally resolve this 12-month range.
Tight coils like this usually resolve in fierce fashion. And when they do, big moves ensue.
What I’m saying is I think this breakout has legs...
If momentum holds, I’m looking for a move toward the upper end of this base, somewhere around 5.20.
This level represents the all-time highs achieved in May of last year. It’s the top of the range- but more importantly, it’s an area of overhead supply.
Notice how this resistance zone halted the post-election advance back in March. After a pattern failure and hard whipsaw, copper is ready to take another shot.
And let’s think about what that means…
The popular industrial metal tracks the world's economic health in real time. It incorporates all of it- demand for housing, manufacturing, infrastructure, etc. It’s in everything, from iPhones to EVs.
So, seeing a move like this from such an economically sensitive asset doesn’t suggest fear or risk-off behavior. And it sure doesn’t support the wave of selling we saw in equities this week…
If anything, it supports the idea that risk appetite is still alive and well. And that a global economic recovery could be upon us.
When Dr. Copper speaks, I listen.
I’m on board with its message, and so is Strazza. We’ve been increasing our risk-on exposure in the Breakout Multiplier portfolio since early April, and commodities have played a large part in it.
We bought $FCX calls today for the second time this month. We sold the double on our first batch, and I have a feeling we’ll have even better luck with these.
