Copper prices jump on improving labor market and factory orders? The largely “manufactured” labor report was good and copper prices rose. Therefore, the labor report must have caused copper prices to rise. I love the simplicity of one-dimensional thinking and the trading opportunities it creates.
“Cause and effect” headlines are often used to transfer ownership from commercial traders (the invisible hand) to retail money (the sheeple). I have discussed many times how the invisible hand (commercial traders) slowly accumulated copper during the
sharp decline of 2011. I also suggested that the accumulation, like that of 2008 decline, would likely follow a
1-2 count. The chart below illustrates this outcome.
The accumulation phase has given way to what Richard Wyckoff characterizes as a mark-up phase. The mark up phase was trigger by the first technical signal (TAS1) after 1-2 commercial accumulation. Traders tend to understand mark-up phases as markets climbing the wall of worry until the buying panic.
Emotional interpretations of market phases, however, are notoriously difficult to recognize real-time. That is why I drive out the emotion and recognize trend phases as mathematical money flow setups. I view mark-up phases the slow accumulation and distribution by retail and commercial traders while the market climbs the wall of worry. The mark-up phase ends when invisible hand has quietly repositioned the sheeple to the short side. The process of repositioning which I’ve personally dubbed as creating the bag holders tends to follow a 1-2 count.
Chart: Copper (JJC) And Copper Diffusion Index (DI)

Headline: Copper prices jump on improving US jobs market, factory orders; other commodities are mixed
Copper prices jumped 3.2 percent Friday after a sharp improvement in the U.S. job market and higher factory orders raised hopes for stronger demand.
The move ended an erratic week of small price losses and gains for the industrial metal as investors looked for clues about what’s ahead for the global economy in a slew of economic reports from several countries. Copper can be an indicator of economic health because it is used in a wide range of products from consumer electronics to pipes and wires.
The government said 243,000 jobs were added in January across a broad array of industries. Manufacturing alone added 50,000 jobs, the most in a year. January’s unemployment rate dropped to 8.3 percent and factory orders rose 1.1 percent in December.
Separately, a trade group said service companies grew at the fastest pace in 11 months in January as companies hired workers to keep up with demand.
Source:
washingtonpost.com