There are three main reasons for the high positive correlation between copper price and gold price:
1. Both gold and copper are denominated in US dollars, and their reactions to the US dollar are consistent. In other words, when the dollar rises, it will restrain both, and when the dollar falls, it will boost both.
2. Gold and copper are both scarce products and strategic reserves of a country. It is closely related to the changes in the global economic situation, so many times both of them show the phenomenon of rising and falling together.
3. Because gold is the hedge of paper money, when paper money is oversold, the price of gold will easily rise. However, the market usually pays attention to CPI data to measure whether the currency is oversold, and because CPI data is usually published every month, it has a certain lag. In addition, there is a great controversy about the basket of varieties selected by statistical CPI, which leads to the CPI data can not truly and timely reflect whether the currency in the market is oversold.