COPPER Weekly Chart 4-1/2 Year Low Descending Triangle

The descending triangle on the copper weekly chart highlighted over the last couple years continues to play out. Using the 3.00 level as the base line for the triangle to keep the math easy, the two vertical sides target the 1.30 and 1.70 levels below. If copper drops under 2.00 the world would be in a serious deflationary event a la the Great Depression. Price has collapsed under the 3.00 baseline so the downside targets are now in play. Since the 3.00 is such important S/R, price will need to back kiss going forward.

Copper is down to 2.765 this morning (pink dot) at a 4-1/2 year low to 2010 but if price loses only two or three more pennies under 2.73 the comparable goes back to 2009 and would print a 5-1/2 year low. Global traders and investors ignore copper weakness since the Fed and other central bankers are providing free money. No need to pay any attention to Dr Copper or other old school trivial indicators (said cynically) since the modern-day money-changers plan to print money forever without consequence.

The indicators are oversold and the green lines indicate positive divergence in play so a moderation in price would be expected rather than a further collapse. Once price steadies sideways through Q1 the path will become more apparent ahead, either inflation and healthy economic times returning with copper back above 3.00 and higher, or, the deflationary gorilla finally extracts his pound of flesh that former Fed Chair Bernanke would not let occur in early 2009 sending copper plummeting lower under 2. Life will change quickly with the dire latter outcome since global citizens will have to adjust to a lingering deflationary environment. Cash is king in deflation. The chart shows that Dr Copper is ill. Monitor the descending triangle pattern during 2015. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.