From Taki Tsaklanos: The copper chart is attracting our attention, and it could be setting up for an enticing investment opportunity sooner rather than later.
Copper is doing something it hasn’t done in a very long time: it is consolidating in a tight price range. Check out copper’s chart below.
The key price level to watch is $2.30, and it is only 3 percent above today’s price level.
From a secular perspective, copper’s price is clearly in a downtrend. However, this potential bottom formation, which was triggered after touching secular support early 2016, could result in a tactical bull market.
Investors should watch two important price points. First, $2.30 is important from a tactical perspective. Second, the $2.60 level is extremely important from a secular perspective.
If copper would start a tactical bull market, then our favorite play is Freeport McMoran, symbol FCX, with huge upside potential.
The iPath Bloomberg Copper Subindex Total Return Sub-Index ETN (NYSE:JJC) rose $0.33 (+1.31%) to $25.58 per share in Thursday afternoon trading. Year-to-date, the largest fund tied to copper prices has gained 3.81%.
This article is brought to you courtesy of Investing Haven.