Breaking Down Copper Opportunities

12/01/2014 7:00 am EST

Focus: STRATEGIES

Tom Alexander of AlexanderTrading.com provides a broad overview of why he feels buying copper for the long-term is a sound buying opportunity and he goes to the charts to bolster an example of what he sees as a clear migration of value to the downside.

We have been highlighting copper as a best opportunity for the past few client reports. This is a detailed breakdown of the entire thought process.

Long-term copper is trading below both the larger degree High Volume Node (HVN) as well as the HVN for 2014.

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Below we can see a clear migration of value to the downside. A close above 3.0480 would be needed before a change in trend could be considered, basis this time frame.

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Here is the profile/auction view from October-November to date.

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Below is the daily bar chart with the October-November auction, highlighted along with the HVN for that structure. The general guideline for trading mature auctions is to favor trades on the price side of the HVN. The conviction of November 18 is an additional strong signal in this instance that the short side should be favored.

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Below is a 30-minute chart giving a view of executable situations with minor relative risk to the potential return of the much larger degree time frames.

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By Tom Alexander of AlexanderTrading.com

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