In this week’s video update I finished my intro by saying:
This morning I’m listening to a discussion between macro strategists Julian Brigden and Ral Pal. This, from Brigden, will sound very familiar:
“I’m looking at copper here, we went from just over $200 to almost $500. A logical correction — there’s clearly a ton of support just below $400 — to somewhere around $350 on HG1* would not surprise me. You get a risk off event and those are entirely reasonable levels to see.
Does it change anything? Actually far from it, because… what are they going to double down on? They’re going to come out with more spending, more oriented to more green, right? So it’s just an opportunity to get in.
“Where I do see exponential is in stuff like copper, where there just isn’t physically enough that they can dig out of the ground in time to fulfil these green promises.”
“We’ve got a big problem here, so, yes, it’s buy the dip. But understand that this is a market that moved extraordinarily fast.”
*HG1 is the 1-month copper future contract.
His “extraordinary fast” comment has to do with that parabolic runup I was showing for weeks in the macro videos. The one that I promised was unsustainable and virtually had to correct. Which we’ve been seeing of late — and there could easily be more to come.
Again, the upward pressure on select commodities — over the long-term from here — in all likelihood isn’t going anywhere. But, absolutely, there will be volatility along the way.