Time in the Market
               Not Timing the Market

THE ECONOMY LOOKS TO THE DOCTOR

Copper is commonly referred to as “Dr. Copper” or simply “The Doctor” due to its ability to diagnose economic health through price movements. Copper is widely used in various industries, and changes in demand for copper can indicate changes in the global economy.

The significance of China’s reopening process and its impact on the global economy cannot be overstated. As the world’s largest producer of steel and aluminium, China’s resumption of production not only affects the metal markets but also has a ripple effect on the entire global economy. The closely watched “rounded bottom” signal from “The Doctor” holds immense weight in determining the pace of recovery for many nations.

China’s measured approach towards its revival is a reflection of its long-term economic strategy. By prioritizing stability and sustainability over immediate gains, China hopes to ensure a steady and sustainable recovery for its economy. This measured approach is in stark contrast to the impulsive and reactive approach often taken by other nations in the face of economic crisis.

It is worth noting that 49% of the world’s copper demand is met by China, with a significant portion going toward the country’s property sector. In conjunction with China’s massive 5G networks, electric vehicle charging stations, broadband networks, automotive industry, renewable energy systems, smartphones, roads, bridges, and its enormous water pipe system project, it highlights the crucial role copper plays in the country’s economy and growth.

The prices of other metals may also be influenced by uncertainties regarding the rate of China’s economic recovery following the lifting of its stringent COVID-19 measures. Despite this, optimism regarding a robust resurgence in Chinese demand has increased metal prices for much of January.

While the price of copper has increased, concerns over potential supply disruptions have arisen, particularly given the substantial investments being made by Europe in renewable energy and grid infrastructure to attain energy independence from Russia and China’s pursuit of de-carbonization.

In Summary, let’s make sure we keep a close eye on ‘The Doctor ‘, because while it looks like they’re going to give China a good Bill of health, the speed of their recovery will require time, and while they slowly walk back into the economy, their momentum will pick, and soon they’ll be running full speed to a good bill of health.

Don’t ignore ‘The Doctor.’

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