We're also beginning to see the Copper miners play catch-up to the underlying commodity.
This has been on our radar for months, but we've only recently seen significant changes.
Here's what we're talking about 👇
The red line represents Copper futures, and the blue candlesticks represent the Global X Copper Miners ETF $COPX.
Historically, these two have danced together.
However, that relationship broke down earlier this year as the futures reached new highs, while the performance of miners stagnated.
Now, with Copper holding above $5, the pressure is building on COPX to follow suit and make new highs.
The recent surge suggests that the miners may be playing some serious catch-up on the upside here.
COPX is at a key level of interest 👇
The Copper Miners ETF has carved out a massive base, and the bulls look poised to take control soon.
This fund holds some of the biggest names in the industry, including First Quantum $FQVLF, Lundin Mining $LUNMF, and Freeport-McMoRan $FCX.
It provides us with a good understanding of how the industry is performing as a whole.
The upper bound of the multi-decade range coincides with the 61.8% retracement of the prior drawdown, lending further significance to it.
After multiple failed attempts, it's now breaking through the same resistance that has capped rallies for years.
If COPX is above 42, the path of least resistance is higher toward new all-time highs.
The bulls are taking control of the short-term trend in COPX 👇
On the daily timeframe, the Copper Miners ETF is trading at fresh year-to-date highs as the price is breaking above the downtrend line from last year’s high. It also flipped that line from resistance into support.
Additionally, the price reclaimed the VWAP, anchored to the 2024 high.
All of these points indicate that the bulls are taking control.
If this short-term breakout holds, it reinforces everything we’re seeing across the longer-term charts.
Our line in the sand is the VWAP anchored to the 2024 highs, which is currently around $42.50
Commercial hedgers are carrying their largest net-long Dollar Index position in years.
Commercials trimmed nearly 5,000 contracts from one of their largest net-short Silver positions ever.
Commercial hedgers unwound over 400 contracts from their net-long Palladium position. They're now less than 3,000 contracts from flipping back to a net-short position.
