Is copper the best metal to trade?

Gold has been testing nine year highs, and silver is making crazy gains too, but there’s another metal worth keeping an eye on and that’s copper. While copper may not be as glamorous as gold and silver, it can still be a good trading instrument thanks to its heavy industrial usage. In fact, that usage is expected to grow as more renewable energy sources come online, and as electric vehicles become more popular. Combine that with tight supplies and copper could be the metal you want to trade.

Is copper a precious metal?

Some people claim that copper is a precious metal, but in reality it is a base metal. There are several reasons to classify copper as a base metal. One is that precious metals are rare in nature, but this isn’t the case for copper. Another is the low melting point of precious metals. Finally, precious metals occur in nature in their metallic state, but copper is almost always found in oxide and sulfite ores that need refining. All that aside, copper is still a commodity metal and is just as good a trade vehicle as any precious metal out there.

What is the best strategy for trading copper?

Copper is an excellent choice for new traders interested in following technical analysis because it tends to have very clear and easy to see chart patterns. Of course traders should also be sure to follow the fundamental developments of the copper market to let them know when supply and demand are rising and falling. By combining the big picture given through fundamental analysis with the details that come out from the study of technical chart patterns, traders will be able to create their best strategy for trading copper.

Copper Trading

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Copper trading via CFDs at AvaTrade

Copper trading has been around since the ancient romans. Being mined in various parts of the world and dating back to 8,700BC, where we know of prehistoric copper pendants and today used more frequently in copper piping. Mined in large pits, copper is an extremely useful material, it can conduct electricity and a trace material in all living things.

Trade Copper with AvaTrade

Unlike most of its fellows metals, copper is not as rare as gold, silver or platinum, for example. Copper has been in use for thousands of years, dating back as far as 8,000 BC. Part of its popularity is the ability to melt it easily and use it in various industries in different ways. With AvaTrade copper CFD trading is a high-demand commodity, with many advantages:

Copper and other metals available with competitive spreads
Employ a leverage of up to on copper
MetaTrader 4 and MetaTrader 5 for manual, semi or fully automatic trading available.
Copy trading platforms including Zulu Trade and Duplitrade
Outstanding multi-lingual customer service with dedicated account managers
Trade around the globe with your mobile phone, tablet or web trading

The Copper Market

The USA used to be the main copper minor, however today most of the world’s copper is mined in Chile. Other countries producing copper in large amounts are China and Peru. Copper is traded around the world, the main markets are the New York Mercantile Exchange (NYMEX), the Mumbai-based Multi Commodity Exchange (MCX), the Shanghai Futures Exchange (SHFE) and the London Metal Exchange (LME). The copper market is open from 22:00 to 20:59 GMT.

What Affects the Copper Price

Like most commodities, copper price changes based supply and demand. Copper is commonly used for different appliances, mostly for housing and electrical machinery. A decline in new house constructions can indicate a slower economy, which can result in a drop of copper prices. Another factor is the supply itself. Should the supply from a region or country slowdown or even stop completely, it could greatly affect the copper market and change its price.

Copper is also used for different new green technologies such as environment friendly batteries and more. Green energies are on the rise as human kind is always searching for better solutions, and a growth in such technologies can bring about an increase in the price of copper. There is also an emerging market demand for copper, mostly from China as they are the biggest consumers of copper. Known as the manufacturing hub of the world, China consume almost half of the world’s copper but do not have enough reserves. This situation gives rise to increasing the supply and global copper trade.

Copper CFD Trading Advantages

It would be safe to assume that most people wouldn’t have a lot of use for large amounts of copper. This is why they are traded for their contract for difference, or CFD in short. This means the trader does not buy or sell the actual instrument, rather trades on a contract with his broker, with the same prices and market movements as the real product. There are several advantages to trading CFDs:

Leverage
Buying copper, much like any precious metals trading, could be expensive. CFDs allow trader to employ leverage, meaning using only a small portion of the trader’s capital to open a position for a certain percentage of its value, and not the full amount. In the case of copper the leverage ratio is .
Cost Effective
Not trading the actual instrument can save a lot of money on side expenses such as transporting, maintaining and storing it. This is why most of the metals, which require all these and more, are only used by its actual consumers.
Easy to Drop
In case of a sudden large change of value, owners of the product will have to find a way to dispose of their resources in order to make a profit or avoid a loss. When trading the instrument’s CFD on the platform, however, all the trader needs to do is simply close his position.

Silver Trading Main FAQs

Is copper the best metal to trade?
Gold has been testing nine year highs, and silver is making crazy gains too, but there’s another metal worth keeping an eye on and that’s copper. While copper may not be as glamorous as gold and silver, it can still be a good trading instrument thanks to its heavy industrial usage. In fact, that usage is expected to grow as more renewable energy sources come online, and as electric vehicles become more popular. Combine that with tight supplies and copper could be the metal you want to trade.
Is copper a precious metal?
Some people claim that copper is a precious metal, but in reality it is a base metal. There are several reasons to classify copper as a base metal. One is that precious metals are rare in nature, but this isn’t the case for copper. Another is the low melting point of precious metals. Finally, precious metals occur in nature in their metallic state, but copper is almost always found in oxide and sulfite ores that need refining. All that aside, copper is still a commodity metal and is just as good a trade vehicle as any precious metal out there.
What is the best strategy for trading copper?
Copper is an excellent choice for new traders interested in following technical analysis because it tends to have very clear and easy to see chart patterns. Of course traders should also be sure to follow the fundamental developments of the copper market to let them know when supply and demand are rising and falling. By combining the big picture given through fundamental analysis with the details that come out from the study of technical chart patterns, traders will be able to create their best strategy for trading copper.

Copper Trading With AvaTrade

AvaTrade invites you to trade copper, as well as many other commodities. With us you can receive copper market news, data, guidance and copper market tips. When choosing a broker for copper trading, AvaTrade comes as a natural choice – because of the experience, the regulation, safety of funds and all the other reasons AvaTrade is standing at the forefront of the industry.

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