CPER: Copper Makes Upside Progress

seekingalpha10-25

Buying copper on price corrections has been rewarding for nearly 25 years, and this trend is expected to continue in 2025.Falling U.S. rates, climate change initiatives, and China's economic stimulus ...

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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nCPER: Copper Makes Upside Progress\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-10-25 06:06 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4729318-cper-copper-makes-upside-progress><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Buying copper on price corrections has been rewarding for nearly 25 years, and this trend is expected to continue in 2025.Falling U.S. rates, climate change initiatives, and China's economic stimulus ...</p>\n\n<a href=\"https://seekingalpha.com/article/4729318-cper-copper-makes-upside-progress\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"CPER","symbol_name":"美国铜指数基金","start_time":0,"source_url":"https://seekingalpha.com/article/4729318-cper-copper-makes-upside-progress","article_id":"2478956690","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1202319290/image_1202319290.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2478956690","pubTimestamp":1729807562,"columns":[],"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"Buying copper on price corrections has been rewarding for nearly 25 years, and this trend is expected to continue in 2025.Falling U.S. rates, climate change initiatives, and China's economic stimulus ","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"CPER":"美国铜指数基金"},"translate_title":"CPER：铜取得上行进展","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"CPER":0.9},"content_text":"Buying copper on price corrections has been rewarding for nearly 25 years, and this trend is expected to continue in 2025.Falling U.S. rates, climate change initiatives, and China's economic stimulus support higher copper prices in the coming years.United States Copper Index Fund, LP ETF offers a way to invest in copper without venturing into leveraged futures, closely following copper's price movements.Technical support at $3.9210 and resistance at $5.1990 indicate a bullish trend for copper, with new highs likely in 2025.   Monty Rakusen My late August 2024 Seeking Alpha article highlighted the compelling case for copper and the United States Copper Index Fund, LP ETF (NYSEARCA:CPER). I concluded: Buying copper on price weakness has been the optimal approach since the turn of this century. While copper’s price has been volatile, buying copper on price corrections for nearly a quarter of a century has rewarded traders and investors with patience and perseverance.  On August 20, nearby COMEX copper futures (HG1:COM) were at the $4.15 per pound level, with the CPER ETF at $26.10 per share. In late October, copper futures and CPER were higher and could continue to move to the upside over the coming weeks and months. Copper futures find a bottom The continuous COMEX copper futures contract probed below the $4 level, finding a bottom.   Ten-Year COMEX Copper Futures Chart (Barchart) The ten-year monthly chart highlights the 24.6% correction from the May 2024 $5.1990 record high to the August 2024 $3.9210 per pound low. Copper only spent a few days below the $4 level before recovering and reaching a $4.79 high on the December contract on September 30. The end of the quarter window dressing likely lifted copper to the most recent high, but copper prices were above the $4.35 per pound level in late October. Higher lows and higher highs in copper throughout this century The long-term chart dating back to the 1970s highlights copper’s over two-decade bull market.   Long-Term COMEX Copper Futures Chart (Barchart) Copper reached rock bottom in 2001 at 60.40 cents per pound and has made higher lows and higher highs, leading to the move to nearly $5.20 in May 2024. The correction that took copper to the August $3.9210 low created another, in a long series, of higher lows. CPER follows copper futures The fund summary for the U.S. Copper ETF product states:   Fund Profile for the CPER ETF Product (Seeking Alpha) At $27.40 per share, CPER had $178.48 million in assets under management. CPER trades an average of 149,594 shares daily and charges a 1.04% management fee. CPER’s top holdings include:   Top Holdings of the CPER ETF Product (uscfinvestments.com) The chart shows that CPER owns three actively traded COMEX copper futures contracts. Copper futures fell 24.6% from the May high to the August low and rallied 11.4% to $4.3685 on October 24.   Ten-Year Chart of the CPER ETF Product (Barchart) Over the same period, the CPER ETF fell 21.9% from $31.63 to $24.70 per share and recovered 10.9% to $27.40 on October 24. Since copper trades around the clock, while the CPER ETF only trades when the stock market operates, the ETF can miss highs or lows when the U.S. stock market is closed. Falling U.S. rates and climate change initiatives support higher copper prices The following factors support a continuation of higher highs in the COMEX copper futures market and the LME forward physical copper market over the coming months and years:  Climate change initiatives, including EVs, wind turbines, and other alternative energy projects, require increasing copper, expanding the demand side of its fundamental equation. Supplies will struggle to keep pace with the increasing requirements. While the world’s mining companies have been developing new mines, it takes years for production to come online. The chart below shows a slight increase in annual copper supplies, but the demand could double to 50 million metric tons by 2035, according to S&P’s global forecast. Demand from the U.S., China, Europe, and India will cause copper supplies to outstrip the demand, creating a growing copper market deficit. Political instability in many countries with significant copper reserves and other regulatory and environmental factors will limit new production.  The bottom line is that copper’s supply demand equation and the bullish technical trend create a compelling case for higher prices over the coming years.   Copper Mine Production 2010-2023 (Statista) China is critical - Stimulus is bullish for copper - Levels to watch in copper futures The most significant factor in copper’s correction after reaching its May 2024 high was economic weakness in China. China is the world’s leading copper-consuming country. In 2021, China consumed over half the world’s refined copper. China and India are the world’s most populous countries, and China is the second-leading economy, second only to the United States. China’s spectacular economic growth over the past decades has slowed. In 2023 and 2024, weak economic conditions have limited raw material demand. In May 2024, copper ran out of upside steam because of weak Chinese demand. In late September 2024, the Chinese government rolled out a stimulus program to cut interest rates and lower bank cash reserve requirements to bolster the economy. A recovery could lead to increased demand for copper and other raw materials. The bottom line is that lower interest rates in China and the U.S. are bullish for copper, and the odds of new highs in 2025 are rising.   Twenty-Year Chart of COMEX Copper Futures (Barchart) The 20-year chart of COMEX copper futures shows technical support at the August 2024 $3.9210 low and technical resistance at the May 2024 $5.1990 high. Meanwhile, over the past two decades, copper has traded in an almost perfect technical bullish pattern, making higher lows and higher highs without violating significant previous lows.   Twenty-Year Chart of LME Three-Month Copper Forwards (Barchart) The chart of three-month LME copper forwards displays the same bullish trend, with support and resistance levels at $8,715 and $11,104.50 per metric ton, respectively. The most direct routes for an investment or speculative risk position in copper are COMEX futures or the LME forwards. Both exchanges offer options contracts on the red metal. Meanwhile, the CPER ETF provides an alternative for market participants seeking copper exposure without venturing into the leveraged and margined futures and forwards arena.  Buying copper during price corrections, leaving room to add on further price weakness, has been optimal throughout this century, and I expect that trend to continue in 2025.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"analysis","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2478956690"}