Copper Pushing Higher
Copper prices have regained bullish momentum this week following a strong up move yesterday. The futures market is now back at 2-month highs as the recovery move off the August lows continues to gain ground. The market has now recouped around 40% off the loss from YTD highs seen in the summer as prices collapsed in the absence of an anticipated 50% tariff on copper.
Copper & Trump
The move, threatened by Trump in early summer, was expected to be part of the sweeping tariff announcements in August. However, copper was widely spared with only some specific areas of the market seeing tariffs. Since then, bearish momentum was seen reversing with prices now grinding higher as attention moves back towards supply issues, global demand and US Dollar expectations.
Mine Closures
The closure of key mine in Indonesia this week, accounting for around 3% of global supply, has helped underpin prices. Owner of the mine, Freeport McMoRan, warned that the site might not be active again until 2027. This comes one the back of a string of issues in Southern American mines this year, reminding traders of how vulnerable the market is to these types of incidents.
US Jobs Data
Looking ahead, there is room for copper prices to continue higher near-term if USD starts to push lower as we approach the October FOMC. The Fed is widely expected to cut rates again with the upcoming US jobs report on Friday set to be a key signpost for the meeting. As such, any weakness in Friday’s data should weigh on USD allowing copper to continue higher.
Technical Views
Copper
The rally in copper has seen the market moving back above the 4.8010 level. With momentum studies bullish, focus is on a continuation back to the 5.1985 level next ahead of the YTD highs above. This outlook only shifts on a break back below the 4.5785 level near-term.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.