By Laura Sanicola, Barron’s
Copper and gold have been winning bets as both the industrial and precious metal notch big gains this year. Copper faces some technical trading hurdles, though, and it may pay to wait for a pullback before buying.
Bruce Zaro, managing director at Granite Wealth Management, sees $4.72 as a key level, noting copper had a “double top breakout” at that price when it was already near the top of a trading band, according to a note on Friday. “Wait for a pull back to that break out point before even thinking about chasing here or, optimally, at $4.44, the first support level,” he wrote.
Zaro notes that the United States Copper Index Fund, an exchange-traded fund, isn’t up as much as its underlying metal. It recently traded around $30.75.
“Investors would be wise to wait for a pullback to at least the $26.50 range or better yet, the bottom of its trading range, $23.50,” he writes. “That said, looking to do some nibbling on such a pullback could make sense.”
Read the rest of this Barron’s article here…
