The copper market rallied right away on Friday, as we gapped significantly. Copper demand keeps me bullish overall.
The copper market gapped higher to kick off the trading session on Friday, showing signs of strength again as the market has been in an uptrend for some time. That being said, it makes sense that the copper market will eventually find reasons to go higher. There is a bit of optimism out there for a US peace deal with the Iranians, but quite frankly, I don't know if we're that close to it.
Nonetheless, what we have is a situation where short-term dips continue to be buying opportunities. It is probably worth noting that the $6.50 level just above is going to be a bit of a short-term barrier, but longer-term, the $6.75 level has formed a little bit of a double top. If we can break above there, then the market could very well go much higher.
Technical Support Levels and Supply-Demand Dynamics
If we fall from here, the 50-day EMA could open up the possibility of a bounce and a bit of a floor in the market. If we were to break down below the 50-day EMA, then we could see the $6.00 level change into the next potential buying opportunity.
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All things being equal, I think this is a market that continues to see a lot of volatility, and with this, I believe that the markets will continue to be noisy. At the end of the day, the biggest thing to keep in mind is that there's a huge amount of copper demand out there and not nearly enough supply.
As interest rates falter a bit or risk appetite picks up, copper will rally. If there is some type of sell-off on Monday, which very well could happen due to weekend headlines, I'll be looking to buy copper. I have no interest in shorting this market.
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