Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24
How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - 17th Feb 24
Why Rising Shipping Costs Won't Cause Inflation - 17th Feb 24
Intensive 6 Week Stock Market Elliott Wave Training Course - 17th Feb 24
INFLATION and the Stock Market Trend - 17th Feb 24
GameStop (GME): 88% Shellacking Yet No Lesson Learned - 17th Feb 24
Nick Millican Explains Real Estate Investment in a Changing World - 17th Feb 24
US Stock Market Addicted to Deficit Spending - 7th Feb 24
Stocks Bull Market Commands It All For Now - 7th Feb 24
Financial Markets Narrative Nonsense - 7th Feb 24
Gold Price Long-Term Outlook Could Not Look Better - 7th Feb 24
Stock Market QE4EVER - 7th Feb 24
Learn How to Accumulate and Distribute (Trim) Stock Positions to Maximise Profits - Investing 101 - 5th Feb 24
US Exponential Budget Deficit - 5th Feb 24
Gold Tipping Points That Investors Shouldn’t Miss - 5th Feb 24
Banking Crisis Quietly Brewing - 5th Feb 24
Stock Market Major Market lows by Calendar Month - 4th Feb 24
Gold Price’s Rally is Normal, but Is It Really Bullish? - 4th Feb 24
More Problems in US Regional Banking System: Where There's Fire There's Smoke - 4th Feb 24
New Hints of US Election Year Market Interventions & Turmoil - 4th Feb 24
Watch Consumer Spending to Know When the Fed Will Cut Interest Rates - 4th Feb 24
STOCK MARKET DISCOUNTING EVENTS BIG PICTURE - 31st Jan 24
Blue Skies Ahead As Stock Market Is Expected To Continue Much Higher - 31st Jan 24
What the Stock Market "Fear Index" VIX May Be Signaling - 31st Jan 24
Stock Market Trend Forecast Review - 31st Jan 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Warren Buffett Buys a Copper Stock!

Commodities / Copper Feb 25, 2021 - 05:19 PM GMT

By: Gary_Tanashian

Commodities

Just kidding. Warren Buffett’s Berkshire Hathaway may or may not own copper stocks. I did not dig deep enough to find out. For the purposes of this post it does not matter.

With the Buffett Buys a Gold Stock! hysterics last summer, the subsequent (and inevitable) fallout and the Buffett Pukes a Gold Stock! resolution, you never know. It’s worth asking the question about what sort of investors are now true-believing in copper and the industrial metals where once upon a time last summer gold was the object of affection.

Look, the contrarian dynamics in play now are 180° from where they were last spring, coming out of the deflationary crash, when we first started to get a handle on and act upon the coming inflation aimed at reflating the economy. NFTRH has used a lot of indicators, starting then and continuing today to be on the right (inflationary) side of this macro dynamic. With all due respect and foresight about macro decision points to come, we remain on the inflationary side today.


Hence, gold is on the outs relative to cyclical assets subject to inflation/reflation, as it should be during such a phase…

Copper is thrusting upward in the cyclical bull market it broke into a few months ago…

The CRB Commodity index is starting to poke through a very important long-term resistance area…

So Buffett bought a gold stock at the top and sold that same stock, Barrick Gold, as the gold stock sector enters the final stages of its correction, which may end in a typical capitulation (we are updating the process and HUI targets in NFTRH updates and individual miners in NFTRH reports). Even at a new cycle low today, HUI has not yet touched the most optimistic of the open downside targets.

But I and I am sure a healthy number of subscribers are in a position of anticipation because there really is nothing new under the sun. When ole’ Warren bought Barrick last summer foremost bull horns in the gold “community” could not wait to broadcast, admonish and tout the news. Warren Buffett… ooh! It was a classic indicator of caution.

And so here we are today, with the macro flipped at a 180°. Wise guys far and wide are advising about how far the inflation-fueled bullish train is going to run. Whether focused on Copper/China, broader industrial metals or my personal favored areas of clean energy/battery metals and materials, everybody is on the Cyclical Inflation Express *. As implied in the previous sentence, that most certainly still includes me, and thus, NFTRH.

But we did not luck into the inflationary reflation early on. We did the work to be ready for it and understand why it was the most likely scenario. The upcoming decision point will be just that, a decision point. The herd looks smart now just as those bearish herds did against the deplorable backdrop coming out of the COVID-crash last March. But that is not how markets work.

At the upcoming decision point, this inflation is either going to get off the hook and morph into one for the ages or it is going to fail once again. Doctor Copper is riding high now and gold is on the outs. It’s a perfect setup. Either way, gold will have utility. Meanwhile, it works through a healthy correction.

* As printed by the Fed (monetary) and deployed first by the Trump admin and now by the Biden admin (fiscal). 

For “best of breed” top down analysis of all major markets, subscribe to NFTRH Premium, which includes an in-depth weekly market report, detailed interim market updates and NFTRH+ dynamic updates and chart/trade setup ideas. You can also keep up to date with actionable public content at NFTRH.com by using the email form on the right sidebar. Follow via Twitter ;@NFTRHgt.

By Gary Tanashian

http://biiwii.com

© 2021 Copyright  Gary Tanashian - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Gary Tanashian Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in