• FREE Shipping & Insurance on Orders Over $500
    FREE Shipping & Insurance on Orders Over $500
back to top

It’s Time to Watch Copper Again

cooper element

We've had an eye trained on copper prices since late 2022. Why? Because any sustained move higher in copper is very likely to bleed over to silver, and with the COMEX silver price so close to a multi-year breakout, a copper catalyst could be all it takes to get things rolling.

Again, though, we've been watching copper for quite some time. There were moments in 2023 when it appeared that copper was set to rally...but it never did. And now here we are in 2024, looking for the same type of surge.

The copper price has moved higher lately, and as I type, it's back above $4/pound on the front month, May24 COMEX contract. See below:

cooper charts

From a technical standpoint, the chart looks pretty good too. Notice that the 50-day moving average is above the 200-day and that both are trending higher.

cooper charts

On the longer-term chart, you can see that a key level of resistance awaits if price can continue higher. Note that the area around $4.20 offered support a few years ago but has recently become resistance. As such, any move back above this level would be a very positive development.

cooper charts

And the fundamental supply/demand picture seems to be improving, too, with several major financial publications taking notice. Here are just a few recent links:

•             https://www.ft.com/content/c3c66359-6bdb-45cb-8ddd-663f10c1d3d9 

•             https://www.barrons.com/articles/ai-copper-stocks-nvidia-angloamerican-southern-copper-68d33f13 

•             https://www.bloomberg.com/news/articles/2024-03-21/copper-resumes-rally-as-fed-rate-signals-boost-industrial-metals 

•             https://www.bloomberg.com/news/articles/2024-03-20/china-copper-smelters-to-discuss-fees-as-crisis-roils-sector 

•              https://oilprice.com/Metals/Commodities/Is-a-Copper-Crisis-Coming-Prices-Hit-New-Highs-on-Smelter-Cuts.html 


Robert Friedland, legendary copper investor and founder of Ivanhoe Mines, is a great follow on X if you want to stay up to date on copper. Here's a sample of some of his latest posts:


cooper charts

cooper charts

Putting it all together, copper looks pretty attractive as both a trade and an investment in 2024 and beyond. However, that's not the theme of this week's post. Instead, check out the two charts below. Let's start with the past six months of COMEX copper and silver paired together with copper prices shown in candlesticks and silver as a blue line. As you can see, that's a pretty tight correlation:

cooper charts

But this correlation isn't anything new. Check out the last five years:

cooper charts

So, let’s have some fun and assume this correlation continues. If the mainstream financial media and copper analysts are correct and the copper price is set to new all-time highs at $5 or $6 per pound, how might silver respond? Would it be left behind at $25 or should we expect the HFT algos to maintain the correlation and drive silver past its breakout point? 

Let's take the correlation all the way back to 2009 and the advent of QE and debt monetization in the aftermath of the Great Financial Crisis. On the chart below, it certainly appears that silver has some catching up to do. How much further might silver rally if copper does indeed head to $6/pound in the months ahead?

cooper charts

Could the impending rally in copper be the spark that finally sets off a breakout in COMEX silver? Yes, it could. As you know, because we discuss it here almost every week, the price of COMEX gold has recently broken out to new all-time highs and the rush of new hedge fund and speculator cash has driven price close to $2300. 

cooper charts

But COMEX silver has yet to break out of its own range. However, a rally in copper could be all it takes to finally drag price up through $26 and $28, and once this happens, $34-36 and even higher prices await.

cooper charts

cooper charts

In summary, copper may hold the key to that elusive breakout in silver we've been waiting for. So keep an eye on it. Actually, don't worry about it. I'll keep an eye on it for you and will report back if and when it begins to break higher and—hopefully— take silver along for the ride.

Don’t miss a golden opportunity.

Now that you’ve gained a deeper understanding about gold, it’s time to browse our selection of gold bars, coins, or exclusive Sprott Gold wafers.

About Sprott Money

Specializing in the sale of bullion, bullion storage and precious metals registered investments, there’s a reason Sprott Money is called “The Most Trusted Name in Precious Metals”.

Since 2008, our customers have trusted us to provide guidance, education, and superior customer service as we help build their holdings in precious metals—no matter the size of the portfolio. Chairman, Eric Sprott, and President, Larisa Sprott, are proud to head up one of the most well-known and reputable precious metal firms in North America. Learn more about Sprott Money.

Learn More
Head shot of Craig Hemke

About the Author

Our Ask The Expert interviewer Craig Hemke began his career in financial services in 1990 but retired in 2008 to focus on family and entrepreneurial opportunities.

Since 2010, he has been the editor and publisher of the TF Metals Report found at TFMetalsReport.com, an online community for precious metal investors.

*The author is not affiliated with, endorsed or sponsored by Sprott Money Ltd. The views and opinions expressed in this material are those of the author or guest speaker, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.


Looks like there are no comments yet.