Copper gapped higher to kick off the trading session on Wednesday as we continue to see copper outperform most other markets.
Quite frankly, copper is going to be in huge demand due to artificial intelligence data centers and many other parts of the electric infrastructure that are almost certainly going to be expanded quite drastically.
Ultimately, I look at the $6.50 level below as a potential support level as it was previous resistance. If we can break above the $6.80 level, that opens up the next leg higher but quite frankly, I think we have a situation where we need to be somewhat cautious.
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A Secular Bull Market
We may have gotten a little bit ahead of ourselves, but I also recognize that this is a market that is in a longer-term secular bullish market attitude and will continue to be so. In fact, it's really not until we are talking about possibly the $6.20 level that I would be somewhat concerned about whether or not buyers would come back in. if we break below there, then it could be a bad sign, but I suspect we get nowhere near that area anyway.
$6.20 should be a pretty significant support level as it was previous resistance and therefore, I think that is your short-term floor. The 50-day EMA sits just below the $6 level and that of course is an area that I think is worth noting as well. I have no interest whatsoever in shorting copper. I think it goes much, much higher. In this environment, it is probably going to be higher than you can imagine.
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