The evidence for a base metals rally has been stacking up recently. Aluminum is shaping up nicely, and we think it could be one of the next to go.
From there, we expect Steel, Nickel, Tin, Zinc, and all of the rest to follow.
Our Equal-Weight Base Metals Index looks ready to break out:
This index holds an equally-weighted basket of Base Metals futures contracts, including Copper, Aluminum, Steel, and others.
As you can see, it had an epic bull market from early 2020 to its peak in early 2022.
Since then, it has suffered a corrective wave and has been in a holding pattern for years.
Notice how the buyers held the price above the peak from over a decade ago. This has been a textbook example of former resistance turning into support.
The next logical step is for the primary trend to reassert itself and for the bulls to regain control.
If and when this happens, we won't just like Base Metals in absolute terms. We expect the group to outperform its Precious Metal counterparts as well.
Our Base vs. Precious Metals ratio is approaching a key level of interest:
You'll notice that this ratio bottomed around this level before the last 2 epic bull runs for Base Metals. Will this time be different?
We doubt it...
For now, we want to see Copper futures stick the landing above 5. We've highlighted this level as our line in the sand.
In case you missed it
We went live yesterday to discuss how we believe this commodity supercycle is about to evolve.
Additionally, we discussed the extreme outperformance of precious metals stocks this year.
Precious metals stocks have been home runs in 2025:
It's not just a few basis points of outperformance that we're talking about.
In Q1 alone, the mining industry groups all rallied by more than 20%. Some individual miners are up over 60%.
It has been a great year for these stocks.
We're covering them every Monday in our Gold Rush column. If you haven't been following along, you're missing out.
And make sure to catch the replay from yesterday's video 👇🎥
This week, we're outlining a $2.5B Canadian exploration and production stock, Peyto Exploration and Development $PEYUF.
The company extracts natural gas, oil, and natural gas liquids from Alberta's Deep Basin. This region is like the Permian Basin of Canada.
In 2023, they acquired Repsol, a Canadian energy company, for about $500M. This has added over 20,000 barrels of oil per day and 455,000 acres of mineral land.
The market loves what this company is doing, and shareholders are being rewarded accordingly.
The stock is printing fresh multi-year highs and resolving a massive bearish-to-bullish trend reversal pattern. We think it's in the early stages of a brand-new uptrend.
Additionally, the stock offers a dividend yield of over 7%. This is well above average for an energy stock.
Here's how we're trading PEYUF 👇
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