Glencore share price surge explained: what next?

By:
on May 20, 2024
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  • Glencore’s stock price is soaring and nearing its all-time high.
  • The company is benefiting from the rising industrial metal prices.
  • Copper, nickel, and zinc prices have soared recently.

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Glencore (LON: GLEN) share price is slowly nearing its all-time high as copper and nickels continued soaring. The stock jumped to a high of 501.9p on Friday and is nearing its record high of 526.5p. It has soared by almost 40% from its lowest point this year.

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Copper and nickel prices are soaring

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The main reason why Glencore stock is surging is that copper, its most important commodity, has spiked to a record high. And analysts expect that the price will continue surging because of the demand and supply mismatch.

Demand is expected to continue rising in the next decades, helped by the ongoing decarbonisation. Electric vehicles require more copper than Internal Combustion Engine (ICE) ones.

Similarly, more countries are spending more money on their electricity grids. Most importantly, the ongoing artificial intelligence trends will lead to more data center demand, leading to more copper. 

At the same time, new mines are not coming online as fast as governments increase their red tape. On average, it takes more than a decade to start mining new copper mines, which explains why BHP has made a bid for Anglo American.

Glencore’s stock price has also surged hard because of nickel, one of its key metals. Nickel price has surged to over $21,500 per ton, its highest point since July last year. It has soared by over 36% from its lowest level this year. 

Nickel, a crucial metal for electric vehicles, has soared hard because of the ongoing protests in New Caledonia. While there are many causes of these protests, analysts believe that its nickel resources are playing a role. 

Glencore’s nickel mines are in Canada, Australia, New Caledonia, Indonesia, and Cuba. According to its most recent report, Glencore produced 23.8kt of nickel, an increase from 20.9kt in Q1’23. It also expects its nickel production this year will be between 80-100kt.

Other industrial metals produced by Glencore have also jumped. Zinc has jumped to $2,993, its highest point since March 2023. It bottomed at about $2,023 earlier this year. Similarly, gold and silver prices have also jumped sharply.

Glencore share price forecast

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Glencore share price

GLEN chart by TradingView

The weekly chart shows that the GLEN stock price has been in a strong bull run in the past few weeks. It has risen to a high of 502.3p, its highest level since February 6th of 2023.

The stock has jumped above the crucial resistance point at 473.55p, its highest level in September and December last year.

It has soared above the 50-week and 100-week exponential moving averages (EMA) while the Relative Strength Index (RSI) is nearing the overbought level of 70. Therefore, the outlook for the stock is bullish, with the next point to watch being at 526.5p, its all-time high.

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