Copper has been one of our preferred resource views in 2024, but after soaring into late May, the industrial metal has fallen away due to four factors: heightened global recession fears, China property/construction collapse, slow global adoption of EVs, and the general unwind of a crowded bullish position. However, after correcting ~28%, we believe the risk/reward has finally returned for the bulls.
- We like copper stocks following their strong bounce in the last fortnight; one way to trade such a view is the WIRE ETF listed on the ASX.
MM likes the WIRE ~$12.75
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As we said last week, MM is not putting money behind these ideas; we are looking to plug a gap in demand highlighted by the recent MM survey—the MM Portfolios are where we commit our funds.
UPDATES: We are currently deciding how best to monitor our previous “Trades of the Week”, but for now, updates as per below.
- We like the risk/reward for WDS if/when we see a drop to new lows ~$26, i.e. only 3-4% lower: currently trading ~$26, the call is at breakeven. Hold for now.
- We like the risk/reward for Nvidia (NVDA US) after its 28% correction; we like NVDA below $US100: NVDA is currently at $US124.58 after reaching $US90.69; the call is up ~25%. Hold for now.
- We like the risk/reward towards US tech if we see another test of 2024 lows – levels not achieved.
