Following the Copper Trends
Today’s a good day for a checkup from “Dr. Copper.” The useful metal has “a Ph.D. in economics,” the kitschy saying goes. If the world starts using less — in their homes, their electronics, etc. — a fall in copper demand should precede a global slowdown. It’s used in damn near everything, after all. So if prices are down, that has to mean something… right?
Yesterday, the copper spot price fell below its 200-day moving average. We don’t like to give the charts much attention, but this is one of those breakdowns of support that gets a lot of people excited. At barely $3 today, it’s also 60 cents off its year-to-date high.
In other words, copper just slipped into a bear market. If his Ph.D. still carries any clout, the world might follow suit.
Perhaps even more telling, commodities in general have taken quite a hit.
The CRB index, which covers most of the major commodities, is at a seven-month low. With the exception of a few precious metals, May’s been a terrible month for commodities.