Copper Futures is breaking out. 2.75
IMO , If price holds on Monday, then I expect Copper miners & KAZ to rise sharply next week.
I would also expect the copper price to carry on rising towards the 15th December.
If a Deal is agreed between the US & China, then I would expect the copper price to go to 3.00, and KAZ to keep rising.
OK, this is a different issue, I was going to mention it in my last post, but you beat me to it.
My answer to your post this is for Example Apple, they want to make Iphones in China
Now, you explain to me how you will manufacture a high tech device in another country without explaining to the guys there how they are going to do it ? ,,, They are human, not Robots !
You will have to have assembly lines, Quality, logistics etc. etc. ect.
They guys will have to know almost EVERY thing about the product that you are asking them to manufacture, and believe me, it cant be done in any other way, I am an engineer, and I understand what it takes to make something simple, let alone High Tech .
But wait a minute !, the Chinese are sending their brightest young people to get educated in the best western Universities
So now they have a generation of the best engineers, scientists , doctors, etc..
They just landed a space craft on the Dark side of the Moon, and they are the first to do so.
What I am trying to say is that they don't need to copy and replicate, because they now have the knowledge to make what they want, better and cheaper.
I never understood why people call the US / China trade unfair ?
Why is it unfair if I can make a product cheaper than every one else, so I sell lots of it
I would call it free market , and healthy competition, no one is forcing any country to buy from China, we do that because it is cheaper to buy from them.
Don't we all shop around for cheaper products ?
If India or any one else make the same product cheaper than China, then we will forget China and buy from the cheapest supplier.
Please correct me if I am wrong !
I wouldn't be surprised if China now turn around and walk away.
I don't think many people know how tough the Chinese are, and maybe they have been pushed to far in this trade war, and they had enough.
I have been to China, and saw first hand how hard working they are, and I admire them for that.
So, if they decided to walk away from the deal, then they will, no matter what.
They have been through many many years of hard grafting that transformed their economy to the second in the world, and I am sure they can carry on the hard work for many years to come.
Don't forget also that they got many important cards in their hand to play with, such as the Rare Earth Metals
If I was the US, then I would quickly take the deal before it is too late.
Also as Causal said : you cant fight the whole world !, try to keep some friends !
Good Morning Rastuss :
Thanks for your thoughts and valuable opinion.
We saw not long ago an alarm bell for the US economy, the "Inverted Curve" (I don't know really the details), also when the Market keeps going into new highs, and many experts warned that there will be a recession, based on the evidence of many past years.
I am sure the financial advisers and negotiators are aware of this while they are talking to China.
So, lets wait and see what will happen in the next 2 weeks, because , as you know, the US is planning to hike up the tariffs again on the 15th if there is no deal by then.
Fingers crossed, and all the best.
Rastuss : I don’t think the US wants the phase 1 deal to fail , they have seen the alarming bells ringing to warn them of not finishing this deal, at least the first phase.
Also from what I read , it indicated that this is really a turning point for the Chinese economy, and they will throw all they can at it to turn the tide .
Don’t forget that the Chinese economy is just like any other , they start as a cheap labour, then matured into a consumer market , and just look how the Chinese now have evolved , they have the very rich and the middle class , although the numbers are small, but I think this will change very soon into a huge consumer market like no other , it is the mature way of evolution from industrial revolution to a high tech , and efficient economy.
I would say , it will start to happen next year .
The Chinese people worked very hard for the last 3 decades , and now they want to feel the fruits of their hard work , I.e. cars , TV’s, cameras , computers , etc..
China's factory activity unexpectedly returns to growth in November
Well, Well, Well
I can see 2 major things here at play :
1) A Stimulus plan starting to take effect.
2) A very important, and more effective than any thing else, is the Chinese Economy starting to change from a major cheap labour market into a Consumer Market.
This is very important, just think about 1.6 BILLION consumers,,,, this is the biggest market of All.
IMHO, I can see a turning point in the Chinse Economy, so they have now waken up and will not put their future in the hands of other countries demanding trade deals etc..
China’s Economy Slows for 7th Month, Early Indicators Show
IMHO, I think this is good news !
Now the Chinese will be keen to wrap up a deal with the US, and more importantly do something urgent to stop the slow down in their economy, namely a huge stimulus plan to revers the slowing trend.
I expect both things to happen soon, lets wait and see !
In the mean time, Copper futures now crossed the 2.70 line,,, good news !
Will it really happen this time ????
I will believe it when I see it !!!
Fingers cross !!
Rastuss : I don’t think increasing the tariffs as a backup plan is a good idea .
There is a limit to how much you can increase them without damaging the economy, don’t forget that it is the US companies and ultimately the US consumers who are paying these tariffs .
I think they will have to wrap and make that deal before Christmas to safe the economy and win the election next year .
Yes, Lots of resistance at 270
I suppose the shorters are still there, and the US/ China deal not signed yet !
Last time they were just about to sign it, then it all went to pot !, so I understand why investors are carful not to commit until the deal is signed.
But all in all, I think sentiment is good, and KAZ is in a great position to ride high on copper price .
Copper futures price bounced up again due to mainly 2 reasons :
1) Latest news of Trade Talks suggest improvements and progress.
2) The protests in Chilie are not over yet, which is adding concern regarding the supply of copper .
3) Also don’t forget the latest employment figures from US beating estimates with a large margin, and the US Market is at All Time High .
IMHO, I reckon we will have a good rally towards the end of the year , and if the US & China sign the First stage of a Trade Treaty before the end of the year, then that would be even better, and will extend the rally to next year.
GLA next week