Copper is one commodity that is not trading based on supply and demand fundamentals. According to financial expert Matt Badiali, copper supply is much lower than the current demand. Many copper bulls have been extremely frustrated with the performance of the metal this year. Mr. Badiali is not deterred by the poor price action in copper because he is calling it short-term noise. He feels that investors should be positioning themselves now because over the next few years there will be supply shortages of copper and ultimately the metal will enter an epic bull market.
As a man who has a strong background in the natural resource sector, Matt Badiali makes it his focus to stay on top of the commodities market and pays attention to how geopolitical and economic situations may affect how the commodities trade. Mr. Badiali feels that the trade war is the cause for copper to trade so poorly. He feels that the trade war has brought an irrational fear to the market and the short-term speculators are using their emotions to make trading decisions. The trade war has been a hot topic this year and many respected analysts fear that if the US and China continue with the trade war, they will push the whole world into a recession. Copper tends to fall right before a recession and many traders are anticipating this outcome. Matt Badiali points to the current supply deficit in copper as getting much worse in the next few years. He also reminds investors that it will take several years for new copper mines to get online.
Matt Badiali understands how some investors in copper companies may be feeling discouraged because of the price action and he feels their pain. He advises them to stay the course because he feels copper supply is only going to get much tighter in the years to come. Mr. Badiali feels that the electric vehicle is going to be a game changer for copper investors. The electric vehicle is going to need a load more copper than a traditional car. The government in China is going to be pushing their automakers to sell electric cars starting in 2019. Copper seems to be setting up for a perfect move higher and the miners should benefit in the coming years.
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