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The Copper Market Indicates a Potential Recession


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The Dec' 19 copper futures monthly chart shows what could be a massive multi-year head and shoulders pattern forming between November 2016 and today. Typically, when discussing the likelihood of an oncoming recession and referencing futures markets, you will hear a whole lot about treasuries spreads and yield curves. However, what has been standing out to me is the copper charts. Why? Because copper represents construction, it represents industry, and its demand is strongly correlated with economic expansion and growth globally. If this developing chart pattern indicates the potential for copper prices to fall dramatically and for an extended period, I don't think it will be because of an explosion in copper production, rather it would be from the shriveling of demand. If economic expansion directly increases demand and drives the price of this commodity up, then what pushes it down will likely be economic recession.To learn more about chart patterns and how to use them you may download our free Technical Analysis Trading Guide here, Or click the link below.

https://rjofutures.rjobrien.com/trading-offers/technical-analysis-guide?cid=7012R000000uiq7QAA

Dec 19 Copper Monthly Chart



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About the author


Eric entered the workforce during the summer of 2007 as an apprentice tradesman just before the big crash and recession which followed. The impact of which strongly inspired his interest in the financial industry and began him as a student of the markets. Eric worked throughout the following years developing strong communication skills and risk management practices in the aviation and marketing industries before ultimately getting licensed and turning his passion into a career as a market strategist with RJO Futures.

Sector Focus

Eric specializes in trend following strategies in metals, stock indices, energies, grains, softs.

Analysis Preference

Supply and demand data ultimately determines the long term trend direction. However, Eric uses basic chart patterns and price action to determine the impact news and information has upon the markets, which provides insight to the short term volatility and provides clarity on timing for entry and exit of a position.

Strengths and Trading Philosophy

There are opportunities in the futures markets each minute of every trading day. Spreads and option strategies are utilized by Eric as they present themselves. These opportunities may tend to take place after a long buildup or extreme events. When they reveal themselves, he believes in using discipline during the three phases of a complete trading strategy: Information, Action, and Exit. Diligence in acquiring, organizing and reviewing solid and reliable information, coupled with knowing the risk that is involved. Eric's strength is confidence in taking decisive action to use opportunities revealed by the information.

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