The relative weakness of FCX compared to copper and gold prices indicates that these are all likely Unpleasant 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 looks like we are on the verge of a huge slide.
Since the size of the drops that follow this pattern are generally comparable to the size of the head, it appears that we could see a drop to $30 or lower relatively quickly – in the following weeks.
Gold rally unlikely in the short term
A confirmation of the collapse would further increase the odds for this scenario, but even FCX’s relative weakness and the invalidation of the breakout in copper make this big move less likely.
This in turn makes a price drop in the precious metals market even more likely.
Moreover, the USD index is moving higher again, which is a bearish factor for commodities and precious metals.