Monday, November 28, 2005
Copper Bulls & Short Squeezers Now Squeezed Of Cash?
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Copper stocks, such as PD and PCU are down from Friday
(Nov 25, 2005)'s close, today, November 28, 2005, the
first day of post-Thanksgiving trading.
(Nov 25, 2005)'s close, today, November 28, 2005, the
first day of post-Thanksgiving trading.
This hints that the short-squeezers had difficulty to
paint copper prices higher. If this is due to their
exhaustion of financial collateral to do so, it would
mean a short-term (and by definition possibly longer
term also) price peak for copper.
The most bearish strategy that will break copper bull's
back is for SRB (State Reserve Bureau) of China to dump
copper and to deliver physical copper to the nearest
LME (London Metal Exchange) warehouse in Pusan, South
Korea. This appears to be what SRB is doing and intend
to follow through. Such strategy by the SRB would be
the worst news possible for LME copper bulls and short-
squeezers.
Meanwhile, another re-test of Friday's high in PCU and
PD is probable, but not expected to exceed it near term.
If so, this re-test may be a very low risk price level
to establish bearish positions (new or averaging up).
There are many possible bearish strategies, exclusive
of using copper futures and future options, to profit
from a price decline in copper, such as shorting copper
stock, buying puts, selling calls, and other bearish
option strategies using spreads, and a combination of
all the above, as appropriate.
The opportunity situation is getting quite interesting
especially for shrewd copper bears who show an uncanny
savvy to show up for the profit party just at the right
moment, neither too early, nor too late.
