Copper Nears Breakout–Fundamentals and Technicals Both Say “Buy"Copper, often called “the metal with a PhD in economics”, is sending a clear message: we’re entering a new bullish era.
As of mid-May 2025, Copper is trading above $4.85 per pound, approaching the psychological $5.00 level — a key threshold that could trigger further upside momentum.
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🔎 Fundamentals: A Perfect Storm of Demand and Supply Pressure
Copper is no longer just about cyclical demand — it's about structural shifts:
• 🟩 Demand is exploding thanks to:
- Accelerated electrification (EVs use up to 4x more copper than traditional cars)
- Renewable energy infrastructure (cables, turbines, transformers)
- China’s infrastructure push and global energy transition
• 🟥 Supply remains constrained:
- Inventories at multi-year lows (LME + SHFE down over 40% YoY)
- Underinvestment in mining: new copper projects take 8–10 years to develop
- Smelting disruptions in Peru and DRC
- China controls ~70% of global refining capacity — a geopolitical risk amid trade tensions
📊 Big Banks Are Bullish:
• Goldman Sachs sees $10,700/ton within 12 months
• Morgan Stanley targets $9,500/ton by end of 2025
• J.P. Morgan: "Copper is at the heart of a multi-year base metals upcycle"
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📉 Technical Outlook: Higher Lows, Strong Rebounds, and a Breakout in Sight
From a charting perspective, Copper’s structure confirms what the fundamentals are screaming:
• After topping around $5.00 in March 2022, the price dropped sharply to just above $3.00 by mid-summer
• That area marked a strong support zone, coinciding with old resistance from 2017–2018
• A higher low at $3.50 was made in October 2023, setting the tone for a new bullish phase
• Since then, Copper has respected a clear ascending trendline
🚨 The drop in late March / early April (coinciding with the start of the Tariff Saga) brought high volatility, sending price briefly from above $5.00 to around $4.00 support. But bulls stepped in fast.
Now, price is back near $5.00, threatening a major breakout.
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🎯 What’s Next?
If Copper breaks above the $5.00 resistance zone, we could see acceleration toward the $7.00 level — a feasible medium-term target, supported by both supply/demand dynamics and price structure.
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📊 Trading Plan:
With fundamentals and technicals aligned, the strategy is straightforward:
Buy dips, especially toward $4.60–$4.70, and look for confirmation of breakout above $5.00 for medium-term positioning.
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📌 Big moves need big reasons — and Copper has plenty.
This may be just the beginning of a multi-year opportunity. 🚀
