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In February, I presented my analysis of copper and gold/copper price trends in a post titled, Dr. Copper Prescribes Gold. Now, it’s time to update both charts.
In the previous analysis, most readers preferred a conservative outlook for copper futures prices, predicting a drop to only the equal distance in the CD part, which is $2.45. Since then, the price has declined, but not as rapidly as anticipated.
Let me show you the updated copper futures chart below.
Source: TradingView
As expected, the price action on the Rising Wedge pattern’s support played out in textbook fashion, with the price breaking below it and then spiking up to retest it before continuing its downward trend.

The price has now reached a double support zone formed by the purple moving average and the black horizontal trendline, between the $3.78 and $3.83 levels.
The RSI indicator has already turned bearish by sinking below the key support of 50, which could further support the breakdown of the aforementioned double support.
The target levels remain unchanged as none of the previous peaks have been surpassed. The nearest target is at $2.45 (CD = AB), followed by $2.02 (large 2nd move = large 1st move down), and the farthest target is the valley of 2008 at $1.25.
The recent release of US GDP data, which was well below expectations, and the contracting Chinese manufacturing statistics are supporting a bearish outlook for the copper price.

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Moving next to the gold/copper ratio chart.
Source: TradingView
For this update, I am presenting a tactical map that focuses on recent changes in price action, in contrast to the previous large-scale quarterly chart which provided a broader outlook.
This new chart allows us to see the shifts that have occurred since February, which may not be apparent on a longer time frame.
The initial phase of the reversal began in 2021, marked by the first blue leg that started from the 368 oz valley, leading to a ratio peak of 542 oz last summer.
Following this, there was a significant correction contained within the red downtrend channel. This correction continued until the ratio reached the 61.8% retracement level, known as the ‘golden cut,’ around 434 oz in February of this year. It was at this point that I alerted you about the major reversal.
Since the previous post was published, the ratio has increased by 10% and currently stands at 514 oz, indicating the start of the blue leg 2. It has surpassed the purple moving average, broken out of the red downtrend, and exceeded the previous high of 498 oz.
The next obstacle is the peak of the first upward move at 542 oz, which the current uptrend is expected to surpass for confirmation.
The RSI indicator is also signaling bullish momentum, with its current position above a key support level and a rising trend.
Looking ahead, the target for the second bullish move can be found at the same distance as the initial reversal, which is around 616 oz. This level also coincides with several important inflection points from 2019-2020.

Beyond that, the next significant barrier is at the top of 2020, which is located at 776 oz, and would represent a significant move up for the ratio.
In the previous post, most readers believed that “something similar to the Great Recession may be on the horizon”, according to the poll results.
While the trend is currently bullish for the gold/copper ratio, it suggests a potentially gloomy outlook for the global economy, as investors seek the safety of gold.
Let me know what your thoughts are on this outlook in the comments below.
Intelligent trades!
Aibek BurabayevINO.com Contributor
Disclosure: This contributor has no positions in any stocks mentioned in this article. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

Editor’s Note: In this piece, we look at how Bud Light’s self-inflicted pain could become its rivals’ gain.

Bud Light’s support for diversity and inclusivity backfired when an Instagram video” by trans influencer Dylan Mulvaney featuring herself drinking a Bud Light as part of an ad campaign by the brand to celebrate the end of March Madness and promote a sweepstakes contest for the company drew flak from some its outspoken conservative fans.
With Mulvaney sharing a photo of a commemorative Bud Light can with her face on it celebrating her “365 days of girlhood” series on TikTok documenting her gender transition, affiliate brands such as Bud Light and Maybelline have become a target of the ire of conservatives over transgender rights.
The vocal and explicit outrage ranged from calls to boycott the brand, with rapper-singer Kid Rock going as far as shooting up cases of Bud Light with an automatic rifle while wearing a MAGA hat, to death threats to Anheuser-Busch InBev SA/NV (BUD) marketing executives who supervised the campaign with Dylan Mulvaney.
This has prompted Alissa Heinerscheid, vice president of marketing for Bud Light, and her boss, Daniel Blake, Budweiser’s group vice president for marketing, to take a leave of absence.
In an attempt to pacify its irked consumers and restore their images, Bud Light’s sister brands have pivoted away from their inclusive messaging. On April 14, Budweiser released an ad featuring its signature Clydesdale horse mascot to invoke patriotic sentiments in its patrons.
According to the experts, changing demographics suggest that Bud Light’s inclusive ad campaigns make good sense in the long run and are expected to keep the brand in what, according to BUD’s CEO, is “the business of bringing people together over a beer.”
However, the soup the brand has landed in might warm up the prospects of other beverage stocks. While the “woke-free” beer being brewed by “Conservative Dad” may not make the cut, here are some contenders to look out for.

Ambev S.A. (ABEV)
Ambev S.A. (ABEV), a subsidiary of Interbrew International BVT, is a beverage company headquartered in Sao Paolo, Brazil, that distributes and sells beer, carbonated soft drinks (CSDs), and other non-alcoholic and non-carbonated (NANC) beverages across the Americas. The company operates through three geographical segments: Latin America North; Latin America South; and Canada.
On April 25, ABEV’s Board of Directors approved and homologated the issuance of new common shares as a result of the exercise, by certain beneficiaries, of stock options,within the scope of the Company’s Stock Option Plan. This reflects the investors’ confidence in the company’s prospects.Despite a challenging macroeconomic environment, consistent execution of its platform model, coupled with commercial momentum in its home market in Brazil, helped ABEV ensure a top-line growth of 19.8% year-over-year and a 17.1% year-over-year consolidated growth in normalized EBITDA in the fiscal year 2022.

Constellation Brands, Inc. (STZ)
Constellation Brands, Inc. (STZ)is an international beverage and alcohol company operating in the United States, Mexico, New Zealand, and Italy. Its segments include Beer; Wine and Spirits; and Canopy.
The beer brands sold by the company include Modelo Especial, Corona Premier, and Victoria, Pacifico, while its portfolio of Cook’s California Champagne, Mount Veeder, My Favorite Neighbor, Casa Noble, Mi CAMPO, Kim Crawford, Ruffino, Robert Mondavi Winery, Copper & Kings, and others.
For the fiscal year ending February 28, 2023, STZ outperformed its net sales and operating income growth outlook. The company’s top line grew by 7% year-over-year to a record $9.45 billion, while its operating income increased by 22% year-over-year to $2.84 billion.
Robust financial performance has enabled STZ to exceed its goal of returning $5 billion to its shareholders in the form of repurchases and dividends. With spirits, such as gin and vodka, overtaking beer’s U.S. market share,riding on the momentum of high-end cocktail trends, the company expects to build on its momentum and deliver value to its shareholders in the fiscal year 2024 as well.
Molson Coors Beverage Company (TAP)
Molson Coors Beverage Company (TAP)is a holding company that operates through two segments: Americas and EMEA&APAC.
The Americas segment consists of the production, marketing, and sales of its brands and other owned and licensed brands in the United States, Canada, and various countries in the Caribbean, Latin, and South America. The EMEA&APAC segment consists of the production, marketing, and sales of its primary brands as well as other owned and licensed brands in various European countries and certain countries within the Middle East, Africa, and Asia Pacific.
For the fiscal year that ended December 31, 2022, TAP’s net sales increased by 4.1% year-over-year, primarily due to positive net pricing and favorable sales mix. During the same period, the company has also been able to reduce its net debt by $562.4 million.
On February 28, a week after announcing its top and bottom-line growth, TAP announced the creation of a centralized commercial function in its Americas business unit designed to accelerate its growth in the years ahead.
By uniting multiple teams and geographies around a single strategy, the function is expected to drive clearer total portfolio and geographic prioritization and allow the company to scale new white spaces, brands, and capabilities more quickly.

Shares of Tesla (TSLA) are once again giving traders big daily moves. After the stock hit a 52-week low of $101, it bounced back above $210, and now it appears to be heading lower again.
The catalyst for the move lower was primarily the company’s most recent earnings report, which, despite sales, revenue, and earnings all coming in strong, margins took a hit.
Tesla has dropped prices on its vehicles five times over the last year, so margins taking a hit should not have been as much of a surprise as it was to the market.
However, Tesla still has a strong market position and is still producing industry-leading margins. The issue is that those margins are shrinking, and at some point, Tesla may see its margins fall more in line with the rest of the auto industry.
We have seen these types are situations play out in other sectors as companies grow and mature. The best example I can think of is Whole Foods.

When Whole Foods was a young, fresh company, it commanded upwards of 5% margins on its products. But, as the company grew and the rest of the grocery industry noticed what Whole Foods could do with selling premium products and commanding higher margins, other grocery store chains began to offer similar products.
This competition for the customer naturally puts pressure on Whole Foods’ margins, thus forcing them to lower prices and lose their high margins.
I believe the same story is now playing out with Tesla. At this time, it is clear that the world is moving away from combustion engine vehicles, although slower than some would like. And as consumers move towards more electric vehicles, more companies are offering alternatives to just buying a Tesla.
More competition is always a good thing for the consumer, but not always the best thing for one individual company.
For years, Tesla was, in many ways, the only legitimate player in the EV industry (sorry, Nissan Leaf, but it is true.) Tesla’s most significant differentiating factors that held off the competition in the past were that it was a high-end luxury EV with a superior battery range.
Both factors have eroded as Lexius, BMW, Mercedes, and other luxury car manufacturers have entered the EV segment.
As for the dominance in battery range, while Tesla is still the leader, the other players have closed the gap on how much of a lead Tesla has, again giving consumers many more options besides just buying a Tesla vehicle.
While I don’t believe Tesla will fade into oblivion or even get bought out by another company, like what happened to Whole Foods. I do think we are now going to see Tesla posting numbers that are more in line with auto industry standards.
That means the stock’s current valuation is grossly high. Tesla is trading at 49 times earnings, while the auto industry, on average, is well below a P/E of 10. The only other prominent car manufacturer that is trading even remotely close to Tesla is Ferrari.
Still, they aren’t selling remotely close to the number of Tesla vehicles, so that may not even be a good comparison.
I think investors should be cautious moving forward with investing in Tesla to the long side. I lean towards even getting short Tesla since I believe we are now in a new era where Tesla begins to fall more in line with the rest of the auto industry, with a slight valuation premium, not a four times higher valuation.
A few ways you can short Tesla without shorting the stock are exchange-traded funds.
The Direxion Daily TSLA Bear 1X ETF (TSLS) or the AXS TSLA Bear Daily ETF (TSLQ) are good options. These ETFs will increase in value if Tesla’s stock continues to decline. But, if Tesla stock goes higher, these ETFs will decrease in price.
If you think I am wrong and Tesla is just pausing before it rallies back, you can buy the GraniteShares 1.25X Long TSLA Daily ETF (TSL) or the Direxion Daily TSLA Bull 1.5X Shares (TSLL). Both ETFs will increase in price if Tesla’s stock reverses course and goes higher.

Remember, though; these are all ETFs that are leveraged in some manner, meaning if Tesla stalls and doesn’t go higher or lower, these ETFs will lose value due to contango.
Furthermore, contango will affect these ETFs if you hold them for long periods. While most contango has an effect daily, if you hold these ETFs for a few days or weeks, you should see much of an impact. Months, however, you likely will feel the contango effects.
Whether I am right or wrong, Tesla is always a fun stock to watch and follow, so add these ETFs to your watchlist even if you decide to follow from the sidelines.
Matt ThalmanINO.com ContributorFollow me on Twitter @mthalman5513
Disclosure: This contributor did not hold a position in any investment mentioned above at the time this blog post was published. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

While the Nasdaq 100 (QQQ) has continued its outperformance on the back of a strong start to the Q1 Earnings Season for Big Tech, the real outperformer has been the Gold Miners Index (GDX).
Not only is the index outperforming the major market averages with a 17% return but it’s also outperforming the price of gold, a healthy sign that suggests a potential change in character after years of underperformance.
The recent strength can be attributed to the sharp rise in the gold price towards the psychological $2,000/oz level, resulting in significant margin recovery for gold producers after a tough year plagued with supply chain headwinds and inflationary pressures.
The good news regarding the recent rally in the Gold Miners Index is that momentum is to the upside and sharp pullbacks are likely to find buying support.

The bad news? With the index up over 50% from its Q3 2022 lows, some of the easy money has been made and a few miners are actually looking fully valued.
Fortunately, there are exceptions, and in this update we’ll look at two names that look reasonably valued and are likely to outperform given their relative value compared to peers.
Marathon Gold (MGDPF)
Marathon Gold (MGDPF) is a development-stage gold company based out of Newfoundland, Canada, with the company currently busy constructing its Valentine Gold Project.
The project is home to nearly 3.0 million ounces of gold reserves and the company plans to operate an open-pit mine consisting of three pits (Berry, Valentine, Leprechaun) with average annual production of 195,000 ounces of gold (first 12 years) at industry-leading all-in sustaining costs of $1,007/oz.
Based on the current schedule, Marathon is aiming to start producing gold by year-end 2024, and the project should boast ~48% margins and generate $120 million per annum in free cash flow at a $1,950/oz gold price.
Heading into 2022, Marathon Gold was near fully valued, trading at a market cap north of $600 million and being one of the few junior gold names bucking the sector-wide downtrend.
However, the stock has since slid by over 60% after reporting material cost increases to build its project, with updated costs coming in at $350 million.
This resulted in a funding shortfall and a significant equity raise and in order to address the funding gap, Marathon completed a significant financing which led to unplanned shareholder dilution.
Although this was certainly painful for existing investors and the underperformance has been frustrating, the stock has found itself trading at a market cap of barely $300 million with the project nearly fully financed and nearing 25% completion by summer.
This valuation of barely $100/oz gold reserves is a massive discount to the price paid in takeovers over the past two years despite a higher gold price and it’s made Marathon extremely undervalued on a price to net asset value basis and also a potential takeover target.
In summary, I see the stock as a steal below US$0.63, and I am continuing to build a position on weakness.
Royal Gold (RGLD)
Royal Gold (RGLD) is a precious metals royalty and streaming company with a $8.7 billion market cap and is the #3 name by size among its peer group.
For those unfamiliar with the precious metals sector, royalty/streaming companies offer low-risk exposure to gold and silver given that they allow an investor to get exposure to metals prices with diversification and with insulation from inflationary pressures on operating costs and capital costs.
This is made possible because royalty/streaming companies pay upfront to receive a portion of production over the life of a mine rather than operators which must continuously pay to operate mines and sustain these mines through equipment purchases, tailings expansion, community programs, and mine development/stripping.
Heading into Q2, Royal Gold was one of the better performers among its peers.
However, the company’s recently released 2023 guidance of 320,000 to 345,000 gold equivalent ounces [GEOs] was lighter than investors hoped, with Royal Gold finding itself over 9% from its recent highs despite a mild pullback in metals prices.

While the weaker guidance than expected is a little disappointing, it’s worth noting that Royal Gold has one of the best growth profiles in the sector among its peer group with several assets set to come online over the next few years and its silver stream at the Khoemacau Copper Mine is set to deliver significantly more ounces this year.
Plus, Royal Gold’s size compared to its two largest peers means that even mid-sized deals move the needle for the company so it isn’t having trouble growing and maintaining diversification like the two largest royalty/streaming companies.
Based on a current share price of $133.00, Royal Gold is not cheap enough yet, with it trading at ~21x FY2023 cash flow estimates and I believe the best time to buy the stock is when it’s trading below 18.0x cash flow earnings.
That said, it is one of the most attractively valued name among the top-3 royalty/streaming companies making it a name worth keeping a close eye on if we do see a deeper pullback in metals prices.
Hence, for investors looking for low-risk exposure to precious metals prices that don’t want to step into the riskier development space, I see RGLD as a solid buy-the-dip candidate at $116.00 or lower.
Disclosure: I am long MGDPF
Taylor DartINO.com Contributor
Disclaimer: This article is the opinion of the contributor themselves. Taylor Dart is not a Registered Investment Advisor or Financial Planner. This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Taylor Dart expressly disclaims all liability in respect to actions taken based on any or all of the information in this writing. Given the volatility in the precious metals sector, position sizing is critical, so when buying small-cap precious metals stocks, position sizes should be limited to 5% or less of one’s portfolio.