The crossover of moving averages has formed a turning point, suggesting copper prices may enter an upward trend

1、 Trend analysis

According to monitoring data from Shengyi Society, copper prices have slightly increased this week. As of the 10th, copper prices were reported at 98331.67 yuan/ton, an increase of 2.23% from the beginning of the week and a year-on-year increase of 30.64%.
Copper weekly fluctuation chart
According to the weekly chart of Shengyi Society, copper prices have risen slightly this week, with a decrease of 5 and an increase of 6 in the past three months.
LME copper inventory
According to data released by the London Metal Exchange (LME). LME copper inventory has slightly increased, with 383450 tons of LME copper inventory as of the weekend, up 5.21% from last weekend.
Macroscopically, in the first quarter, the Chinese economy remained stable with progress, and the manufacturing PMI returned to the expansion range, sending a clear signal of increased economic vitality. The US service sector PMI unexpectedly cooled to 54.0 in March, indicating a weakening of expansion momentum. However, the stickiness of the core PCE price index (3.0% year-on-year) is like an invisible line, restraining the nerves of the Federal Reserve. This means that the high interest rate environment may last longer, but the market’s tightening panic has temporarily eased.
Supply side: Overseas mine strikes and frequent force majeure events, coupled with insufficient global capital expenditure, have led to a consensus on the shortage of mining resources. The domestic copper concentrate processing fee (TC) has fallen to freezing point, compressing the profits of smelters. Although sulfuric acid revenue provides a certain buffer, the essence of raw material shortage has not changed.
On the demand side: As we enter April, the traditional peak season effect becomes apparent. The operating rate of refined copper rods has exceeded 80%, and cable and copper tube enterprises have full orders, even experiencing the phenomenon of “production cannot keep up with outbound”.
In summary, the macroeconomic sentiment has rebounded and the fundamentals are characterized by weak supply and strong demand. The bottom support for copper prices is strong, and it is expected that copper prices will experience strong short-term fluctuations.