The copper market continued to see buying pressure during Thursday’s trading session, as copper looks like it is trying to do everything it can to break above the crucial $6.90 level. If it can do that, then copper will be free to challenge the $7 level, an area that will have a certain amount of psychological attachment to it, but it doesn't necessarily mean that it will be the end of the uptrend
In fact, I suspect that the uptrend probably has much further to go as the market continues to look at the massive amount of demand coming from the AI data-center buildout, married with the idea that many of the major mines in places like Chile are struggling with output. In fact, there have been some mines seeing flooding.
Supply and Demand
When you marry high demand with shrinking supply, that means the price eventually goes higher. Ultimately, this is a market that has much further to go from what I can see.
Although I am the first one to admit that 4 strong days in a row probably warrants some type of pullback, that pullback should be thought of as a potential buying opportunity. I think the 50-day EMA, sitting right at the $6.55 level, opens up the possibility of support there, with the $6.50 level as well.
This is a market that will occasionally pull back, and ultimately value hunters will return because the longer-term scenario has not changed. Quite frankly, I do not see how it can. Interest rates are pretty high in the United States, and that is a little bit of a drag on copper, but not as much as a market like silver.
This is about forward progress, the electrification of the economy, and the contracts that are already signed to build massive data centers.
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