Chart of the Day - Tuesday, May 3rd, 2022

Today’s Chart of the Day was shared by Eric Conrads (@conradseric). It’s a daily chart of Copper over the past year and a half. Copper broke out to an all-time high just two months ago, however, that breakout quickly failed, and it closed at year-to-date lows yesterday. It’s been consolidating within an uptrend for a year now, however, that consolidation is resolving lower. Consolidations typically resolve in the direction of the underlying trend, but when they don’t, it’s a major red flag. As we know, Copper is perceived as a leading indicator for both the stock market and the economy. As Eric points out, Copper breaking down is further evidence that a recession could be lurking.