Chart of the day: Rock-bottom rubber
Shanghai rubber futures have not managed a decent bounce in weeks despite crawling along at some of the lowest levels in a decade. There is no doubt that the psychological level of 10,000 yuan per tonne is a very important secular support area, so despite the lack of momentum, we continue to favour a squeeze higher – hopefully soon. Last week’s hammer candlestick can be seen as the first glimmer of hope, with a break above the top of the triangle (which coincides with the nine-week moving average) needed to add to bullish pressure. Note also how the lower edge of the weekly cloud rises sharply in October, meaning there ought to be less chart resistance.
Nicole Elliott is a technical analyst