Gold and silver typically gain around the end of the year from a seasonal perspective and their patterns are often picked up around year end. However, one less well-known pattern is that of copper.

Around the end of the year, copper prices have a marked seasonal upside. The winning percentage for copper is pretty strong with a 73% winning percentage. The maximum gain has been over 9% with a maximum loss of around -4.77%.

The reasons for copper’s gains are not entirely clear, but the seasonal weakness of the USD is also marked at this time of the year and that is a typical boost for commodity prices.

So, at the Fed’s meeting next week, if Powell indicates a pivot may be ahead, and that the Fed is looking to pause rates that will most likely give copper a big surge as the USD should weaken too. Furthermore, if China’s re-opening narrative picks up that could also further boost demand for copper.

Major Trade Risks: The major trade risk here is that the Fed keeps hiking aggressively and/or if China’s growth slows as both would likely be a headwind for copper prices.

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