Commonly referred to as ‘Doctor Copper,’ this metal is the best indicator of global economic health. And the doc isn’t feeling so hot lately.
Using current weekly copper charts, there’s an indication of a downward projection for copper prices. According to a weekly chart from September, the downside target was reached slowly, indicating a slow but steady slowdown in global economic health.
3 Obstacles for Future Rallies
The first obstacle is the strong resistance near 250 cents. The second obstacle is the strength of the downtrend, as shown by the long-term group of moving averages in the Guppy Multiple Moving Average (GMMA) indicator. These are well separated, showing strong selling pressure.
The third obstacle is the recent support band resistance level near 290 cents. A new uptrend will be confirmed when copper is able to stay above the 290 cent level. The chart suggests that the outlook for copper remains bearish. Doctor Copper is, indeed, very ill.
For more detailed information regarding the technical trend of copper in the economy, continue reading here >>
How does this affect scrappers?
However, copper isn’t the only metal that’s been suffering. An oversupply of metal in general is hindering trading and forcing prices to plummet while Chinese economic growth is falling for the first time since the global financial crisis.
What does this mean for scrappers? With a strong dollar and suffering commodities, there’s an oversupply of metal at the same time manufacturing is down, not just domestically, but globally. There has been talk of China going into a recession, but it hasn’t yet been announced. This means that demand will most likely not be picking up for another year, and the prices will stay level for most of 2016.
Nonetheless, TT&E is still offering top-of-the-market prices, at the highest rates we can provide. Wait it out with us and the scrap metal industry will be booming again before you know it! As always, please contact us or stop by to chat with questions or concerns. We’re always here to listen!
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