Friday, February 21, 2014

Copper collapse coming ? Update of the Elliott Wave Structure

Copper often leads other markets. That's why the red metal is called Dr. Copper. The updated weekly chart of copper reveals the Elliott Wave structure:

Source Elliott Wave Technician

There is no change in our earlier forecast published previously on this blog and repeated under

Copper is in the early stages of a decline in wave "C" marked on the above chart in blue color. Wave "1" of "C" down marked in black color is complete. A corrective rally in wave "2" of "C", also in black color, could be complete, or alt. extent into another a,b and correction over the next few months. Wave "2" can not go higher than wave "e" that would invalidate this near term bearish scenario.

A possible target of coppers decline is the USD 2 - 2.25 area. Good support comes in at around USD 2.15 at the rising support line connecting the 2002 and 2009 bottoms (not visible on the above chart). This support line will be around USD 2.25 at the end of 2014 and around 2.35 at the end of 2016, but expect a "throw over" of the support.area to make our downside target come true. However, the hight of the "B" wave triangle indicate a target of around USD 2.5.

An alternate bullish scenario is that the decline in wave "C" is complete with the current 5 wave decline marked in red color. Under this scenario a larger copper rally is beginning..

How the above fits into the larger Elliott Wave structure of copper is excluded in the above chart.

Geir Solem

Elliott Wave Technician
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