FCX’s relative weakness compared to the prices of copper and gold indicates that they are all likely to move lower.
And given today’s move below the rising support line, which is also the neck level of the head-and-shoulders pattern, it seems that we’re on a verge of a massive slide.
Since sizes of the declines that follow this pattern tend to be similar to the sizes of the head, it seems that we can see a decline to $30 or lower relatively soon – in the following weeks.
Short-Term Gold Rally Unlikely
A confirmation of the breakdown would increase the odds for this scenario even further, but even the relative weakness of FCX and invalidation of the breakout in copper make this large move lower likely.
This, in turn, makes a move lower in the precious metals market even more likely.
Besides, the USD Index is moving higher once again, which is a bearish factor for commodities and precious metals.