Thursday, April 23, 2009

China Buying Copper (+ Chart)

China is on a buying spree in copper. China State Reserves Bureau bought up 329,000 tonnes of copper in February and 375,000 tonnes in March. This explains in part the 70% surge in copper prices since the lows were made in December.

There is saying in copper -- buy on Thanksgiving, sell on Easter. Worked pretty good this year. Although, it was a little hair raising from Thanksgiving to the December low.

China has also been a big buyer of metals like aluminum, nickel, zinc, and tin.

Copper 423

Chart Notes:

  • Copper was overbought at the rally highs.
  • Copper traded above the red line (two standard deviations above the mean) and was due for a correction.
  • The market is currently testing the green line and 2.00.
  • The trend is up and the short, intermediate, and long term averages are all pointing up.
  • First support is around 2.00 and major support is in a band from 1.80 to 1.90.
  • Resistance is at the current highs around 2.23.
  • Technicals point to higher prices.
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Bob DeMarco is a citizen journalist and twenty year Wall Street veteran. Bob has written more than 500 articles with more than 11,000 links to his work on the Internet. Content from All American Investor has been syndicated on Reuters, the Wall Street Journal, Fox News, Pluck, Blog Critics, and a growing list of newspaper websites. Bob is actively seeking syndication and writing assignments.

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