Two weeks ago, all was well with the world. Prices had recovered from their precipitous fall from the prior week, with most looking to make, or at least test previous highs. However, last week saw some, but not all gains given back, as prices fell, ostensibly in response to the stronger dollar.
So this got us thinking… Of course that may seem to be an oxymoron, but yes, we really were thinking about it. Some analysts say the dollar rose in response to higher interest rates, while others think the Buck rose because of rising inflation.
Whatever… When you look at a chart illustrating the connection between copper prices and the Euro, you can see there is a broad relationship between the two. It's rough and not as consistent as one would like. So, in our ongoing, never ending pursuit of trying to understand factors that drive markets, we looked at a few other things, which brings us to the first chart in this week’s report – “Copper versus the Yield on 10-Year Bonds.”
