Metal Analysis Report 8/31/20 - Copper On The Rise Too
According to the National Association of Home Builders, lumber used for framing homes account for roughly 20% of the materials cost of building a home. Right now those homebuilders have leverage and just passing on the cost to the buyers like me and you. However, that’s not deterring buyers away from buying homes as space is the best defense to play against COVID-19.
But don't forget about Copper. It take about 450 lbs of copper to build a single family home. At $3 / oz, that adds about $20k to a home. And with housing start continue to go up each month, that's good news to Dr. Copper.
Lets go to the chart to analyze copper prices.
Resources:
https://tradingeconomics.com/united-states/housing-starts
MY TRADING METHODOLOGY IN A NUTSHELL BELOW
I’m a supply and demand trader. The premise of supply and demand trading is when the market makes a sharp move up or down the large institutions i.e banks/hedge funds are not able to get their entire trade placed into the market, leaving pending orders to buy or sell at the zone with the expectation the market will return to the zone and the rest of their trading position will be filled.
I use multiple time frame (MTF) analysis to improve my discretionary trading decisions. MTF analysis involves analyzing the same asset on multiple time frames. The rule of thumb when using MFT is you want your charts to scale down/up by 4X – 6X. In my case I tend to look at:
Monthly Charts (curve time frame) – which represents that jet fighter flying over the football stadium.
Weekly Charts (trend time frame) – which represents the concession stands looking down at the field.
Daily Charts (entry time frame) – which represents being on the football field with the player.
4 Hr Charts (entry time frame) – which represents the center hiking the ball to the quarterback.
▶️ 3Speak
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