Courtesy of Doug Short.
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Ole Doc Copper has a decent track record when it comes to reflecting global strength or weakness. Once Copper broke a multi-year support line back in 2008, it fell hard, and the global economy became very soft. This breakdown in 2008 warranted portfolio allocation adjustments for protecting values.
Over the past three years, Copper has created a pattern that isn’t identical, yet it does look a good deal like the 2008 pattern. The breaks of the 2008 and 2012 support lines are taking place at almost the same price!
The decline of late in the short-term might be a bit oversold.
The important issue with these patterns is this: The patterns very much look alike and the key message in this repeating pattern is this: Will the economy act the same in 2012 as it did in 2008? If the message is the same, so is the idea that investors should protect hard earned assets as well!
Footnote from dshort: For you younger foks who might be wondering about the person Nicolas Sarkozy is impersonating, the smiling face on the right is English comedian Stan Laurel (1890?1965) of Laurel and Hardy fame.
(c) Kimble Charting Solutions
blog.kimblechartingsolutions.com
