ended August with a bearish outside reversal bar (a higher high, lower low
and a close below the previous month's low).
This also completed the anticipated bearish setup in the RSI(14)
by having August take out the May low after July put in a lower high than
The rollover of the 20-week average
and the MACD crossing its average confirmed the sale. Look for this top
process to be followed by a cascading waterfall. A minimum drop of 30% (targeting
$3.20) can be anticipated, however something closer to 40% ($2.70)
would be normal.
Major base metal producers (BHP, RIO,
FCX & TCK) continue act poorly with the 50-day and
50-week averages capping the last four week's highs. It is now time to lower
our sights and monitor the 20-day averages as the new resistance.
The last five sell signals in copper
saw BHP decline by 74%, 27%, 24%, 29% and 12% from the high.
Various related bearish ETFs and
options are available; BOS, BOM, JJC, HKD.TO and HMD.TO.
Weekly and daily charts
Weekly charts from failed monthly RSI tops.
Arrows identify the bearish rollover
in the 20-week ema or crossover of MACD
Seasonality favored a topping process
with a failed high in September and a hard decline to follow.
Billiton, Rio Tinto, Freeport McMoran and Teck Resources
in this report are solely those of the author. The information herein was
obtained from various sources; however we do not guarantee its accuracy or
completeness. This research report is prepared for general circulation and is
circulated for general information only. It does not have regard to the
specific investment objectives, financial situation and the particular needs
of any specific person who may receive this report. Investors should seek
financial advice regarding the appropriateness of investing in any securities
or investment strategies discussed or recommended in this report and should
understand that statements regarding future prospects may not be realized.
Investors should note that income from such securities, if any, may fluctuate
and that each securitys
price or value may rise or fall. Accordingly, investors may receive back less
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from time to time, members of the Institutional Advisors team may be long or
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© 2003-2008 Bob Hoye