So Far, So Good... July 12th, 2019 by John Gross
The last few weeks were a bit dicey, but copper and other metals held their ground to come back fighting for another day.
Yes, yes, we’ve been down this ‘on again, off again road’, but at least we are still on the road, and not in a ditch somewhere, and the view does in fact look somewhat better.
The Copper Bar Chart shows recent lows holding, and the price is again closing in on the 10 week moving average. More importantly, stepping back to see the big picture, the ‘higher highs, higher lows’ pattern remains intact from January 2016.
The Copper Price / Inventory Chart is just as interesting and informative. Here we see the lows holding just above $2.60, with the market looking to test $2.70. The 52 week moving average is just a stone’s throw away at $2.76.
Other metals, excepting tin at the moment, are also hinting at better times ahead.
Aluminum, lead, nickel and zinc all held support and ticked higher last week, with lead and nickel also breaking through overhead resistance.
The precious metals also seem happier, with gold holding on to $1,400, a price not seen since 2013.
And as the first chart in this week’s report illustrates, silver is staring at the potential of breaking out of a triangular formation that has been under construction for 3 ½ years.
Crude oil is well off its low, and the Spot price just rose above its 52 week moving average.
As for equities, it looks like ‘Jack and The Bean Stalk’, as markets grow into the clouds.
And it’s not just the United States that is reaching lofty levels, but a similar story is being told around the world.
With the exception of Chile, every other major market is up on a year to date basis, with most in double digit percentage points higher.
And if copper picks up the pace, Chile’s equity markets will be back in positive territory in very short order.
One last thing – the dollar has been edging lower of late.
If, and that is a very Big IF, the dollar begins trending lower, base metals, precious metals and energy markets could well begin marching higher.
View Charts (PDF)