Copper is in its lateral movement third week. Yesterday copper rose like all markets. The main reason for the growth are comments of the Fed Chairman, who noted that inflation has passed its peak.
The latest news regarding the metal's extraction is positive for copper prices.
The Las Bambas copper mine in Peru, owned by Chinese company MMG Ltd., will suspend mining operations again due to problems with the resources supply. MMG Ltd. said the mine accounts for about 2% of the world's copper supply and is the third-largest mine in Peru. About 30% of the country's domestic copper supply is at risk of being shut down. Jefferies said in a report, noting that such actions could lead to further increases in global prices for the metal.
The U.S. Environmental Protection Agency (EPA) finally took the decision to block Pebble Limited Partnership's (PLP) copper and gold mining project in Alaska on environmental grounds. A division of PLP, Northern Dynasty Minerals, had proposed to develop the Pebble deposit in Southwest Alaska. However, the EPA's latest decision prohibits development of the mine in Bristol Bay.
Copper is known to be an indicator of the world economy’s state. It is one of the most important industrial metals, which is in high demand in times of economic growth. On the background of yesterday's optimism in the markets, it could be assumed that the growth of copper prices will resume. Despite high inflation, the world's largest economies are showing resilience due to the latest statistics data. The opening of China is also stimulating the growth of the world economy.
As for the technical analysis, copper is kept in a rectangle closer to the lower boundary. If to look at the S&P index, the dollar index and the 10-year bond yields, it seems clear that they are all at their local extremes.
Thus, a continuation of the copper uptrend may happen in the upper border of the rectangle as well. It corresponds to the copper price of $9,380. A stop-loss can be placed just below the border of the sidewall, where the circular level of $9,000 is located.
The copper price growth:
Take profit – 9 380
Stop-loss – 9 000
This content is for informational purposes only and is not intended to be investing advice.
