Lower oil prices = lower oil costs in Copper (JJC, quote) production.

Image courtesy Windsor: http://www.photoxpress.com/stock-photos/tube/metal/copper/6536788/partner/Xj9qdHIQyb7etVXie4irtPQ9xtZobSzz

The cost curve has fallen dramatically as oil costs have plummeted.   Also copper producer currencies have plummeted making overall cost base in Dollars cheaper. Lower costs mean spot prices fall until you get to cash costs.

We still think commodities are bottoming but the correction needs to take into all accounts of the fall which to this point includes supply, demand, and the ensuing deflationary forces that come with that.

Watch 2.40 in the near term for support.

Chart_ HGc1

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