Copper continues to look bullish overall, as the markets will be watching the massive demand that seemingly will only continue to grow, and the influence of interest rates.
Copper
The copper market gapped higher early on Monday as we continue to see a lot of strength in this market. Interest rates were flat for the day, as cash trading of Treasuries was shut down for multiple holidays. This allowed copper to simply spread its wings and fly.
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AI demand and more.
Copper is a market that has a lot of demand asked of it, with AI data centers seemingly a never-ending source of demand.
There are a few copper mines in South America that simply cannot produce enough, not even being able to produce their usual amount. That being said, this is a market that is sensitive to interest rates, and high interest rates do put a little bit of downward pressure on copper and other non-yielding assets. So that is the one thing causing an issue.
If we get interest-rate relief in the bond market, for example, if the situation in the Middle East calms down, that should allow markets to focus on demand a little bit more than simply worrying about bond markets at the same time. If that ends up being the case, then copper is one of the first places I am actually looking to get involved, along with gold and silver.
Short-term pullbacks at this point in time continue to see the 50-day EMA as support, as well as the $6.50 level. Ultimately, this is a market that I still think has its eye on the $7 level, a large, round, psychologically significant figure and an area that we could not pierce previously.
Nonetheless, when you look at the daily chart, you can see that any time we pull back, there does seem to be demand out there, and buyers jump back in.
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