Wednesday Evening  25 January 2012

  Copper had a recent upside breakout from a wedge and has recently been consolidating the gains made
from that breakout.  You can see it happened, once the 3.45 - 3.50 area was surpassed, three weeks ago.
There were no opportunities to buy a pull-back.  It appears there is sufficient "energy" built up while in
the wedge trading range that can sustain higher prices. 

 There may be some resistance from the 3.8460 swing low from last May, which is just below a small gap
area 3.8610 high from September.  We also drew a hiorizontal line from the wedge trading range high,
but you can see price sailed right through it, last week.  We have been waiting to see how a correction
may develop that could set up a buying opportunity.

 The daily chart gives more detail, and it has been the small trading range of the last five trading days
that held our attention.  Whenever you see this kind of sideways movement, it can be stopping action,
for a reversal, or just a resting spell, prior to a resumption in the direction preceding it.  Given that price
has just rallied strongly out of the wedge formation, we viewed the past five days as the market's way
of correcting.  Instead of price retracing, like most corrections, price has been consolidating, and that is
a sign of strength, in this instance. 

 Buyers have been absorbing all the sellers, keeping price stable and higher.  Those waiting for a pull-
back to buy may not get the opportunity, and if we are right in our assessment, new buyers will have
to pay up to get in, or get left behind.  That kind of scenario is characteristic of a stronger market.  Early
in the Wednesday session, we entered at 1.7930, and the reasoning becomes clearer on an intra day
chart, next.

 [The last bar is as of around 10 a.m., [CST], as we viewed copper as a buy, and it does not reflect the
rally which followed.]

 The lower time frames are used for timing entries, once the stage has been set as described from the
weekly and daily charts.   Tuesday's low was higher, and it was followed by ease of upward movement
on sharply increased volume. [See activity of 24th]

 Coming into Wednesday morning, on a pull-back from overnight highs, we saw yet another likely higher
low, followed with another rally on increased volume, and that was our signal to buy.  If we were right
in reading the market activity, price should work higher, and that is exactly what developed.

 So far, we see no signs of sellers entering in volume to push price lower.  That could develop overnight,
or during the Thursday day session.  Until it happens, we view copper as likely to yet work higher.
Challenging this year's highs is not out of the realm of possibilities, but we never know how price will
develop, moving forward.  If price continues higher this week, and into next week, 3.75 - 3.80 could
become very important support for any retest.

  Long from 3.7930