By Jonathan Barratt

We have been a expecting a lot more out of the copper markets. The litmus test for the global economy is not doing to well. China is the largest consumer of the metal and we have been on the edge of our seats waiting for the outcome of the third plenary session of the Chinese Communist party. This meeting was to put forward reform plans and many expected those to be positive for the copper market. Sadly, the market was disappointed as it failed to give traders what they wanted. As a result, the market was heavily sold off, reaching levels not seen since the beginning of August. In addition to this, expected order demand from Chinese Copper rod producers suggested that 73% of those surveyed expected no rise in orders over November -- a far from inspiring set of results from the number one consumer of the metal and perhaps echoing the sentiment of other consumers of copper.

We continue to base a lot of our economic rhetoric on the demand for primary inputs. Copper is a favourite flag ship, however it has just ben doing nothing Indeed a few days ago it just fell out of bed. This is a sign that those long are just getting fed up with the lacklustre performance and tired of the waiting game. It is interesting that in a market that we have traded a lot it has been over six months since we have taken a position, however we have been ready to do so on may occasions. We continue to monitor the price action in case a few of our levels are triggered.

Last week we suggested that it was pretty clear in the chart below to be able to see any break-out opportunity here. Although we do favour a break-out to the topside, if you took the break to the downside it would have paid off.