by Rick Ackerman, Rick’s Picks
In January, when we last looked in on ‘Doc Copper’ for clues about the health of the global economy, it was in the throes of a two-month rally that I said would go nowhere. Subsequent developments have borne me out and then some, since the price per pound has declined by nearly 50 cents since then. Clearly, this does not bode well for economic growth, nor for the manufacturing economy of the world’s commodity engine, China.
My current outlook calls for more slippage to at least $2.78 a pound, basis the continuous contract. And if that ‘hidden’ support fails decisively, meaning by more than 2 or 3 cents, there is room for a further drop to $2.44. At that point, the world’s economy would probably be in synchronous recession, even if the Dow is trading significantly higher.