Just last week, copper prices rallied for 10 straight days, their longest streak in at least 28 years, according to The Wall Street Journal, and that could be a good sign for global economic health.
Pointing to manufacturing and inflation in China and the U.S., the WSJ stated that previously sluggish global economic growth may have turned into a sprint, which in turn has helped propel copper prices.
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Tai Wong, head of base- and precious-metals trading at BMO Capital Markets, told the newspaper that copper build up from the London Metal Exchange indicates a 10% decline since Oct. 25, which points to a positive sign for demand.
“Whenever you have draws like that, that will help (the price of copper),” Wong told the newspaper.
Not all analysts are bullish on copper until more evidence comes to the forefront.
“One would like to see trending economic growth, rather than a few isolated data points,” Michael Turek, head of base metals at BGC Partners, told the newspaper.
Bull Market on the Horizon?
Our own Raul de Frutos wrote last week that while copper’s movements may not initially imply a bullish run, but looking closer at its fundamentals tells a different story:
“Copper prices have lagged the rest of the industrial metals this year and we’ve been pretty bearish on copper since 2011. But, although still early to make a call, there might be a bull lurking in the shadows. Copper prices might be setting up for a big run,” de Frutos wrote.
How will copper and base metals fare for the remainder of 2016 and into 2017? You can find a more in-depth copper price forecast and outlook in our brand new Monthly Metal Buying Outlook report. For a short- and long-term buying strategy with specific price thresholds: