Quantitative Analysis / Global

Tin is the number one base metal in 2021

  • Tin futures have increased in value by 49% in 2021 alone and 89% in the past 12-months
  • Only Lithium has outpaced it this year, with an impressive 67% increase
  • Our ML model forecasts a further increase of 18%, but profit taking remains a possibility on any overextension
Tin is the number one base metal in 2021

Machine learning forecast

The current price of Tin futures is US$30,233 per 5 tonnes. Our ML model forecasts a further appreciation of 18% over the next 12-months, targeting a break of the significant 2011 high at US$33,500; however, the next few months could see a retracement of up to 10% from current levels before attracting further buying.

Metals price performance for 2021

Tin 1-year rolling performance

Its 1-year rolling return is +89%. Last week it broke to a record of +100% – outpacing the 2010 rally. The bulls may have to tread carefully heading into next year because this type of performance is unsustainable over the long term and the market will naturally look to correct to a more sustainable level.

Tin 1-year rolling performance

Technical analysis

The inverse head and shoulders pattern (labeled “H&S” on the main chart) has been a catalyst for the 2020-2021 rally. Projecting the height of the pattern above the breakout point produces a parallel line the intersects around current levels (US$30,300). This could prompt a bout of short-term profit-taking.

The US$25,800 level represents the top of the H&S pattern and it should act as strong support for any possible retracement lower, but the ML model forecasts an influx of buying pressure well before the market reaches this level.

The 2011 high of US$33,500 will act as a magnet for price over the next 6-months. Most traders will wait for a break above this level before considering unwinding their position. The market’s reaction upon the break will provide vital feedback on the likelihood of a further extension.

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This report is independent investment research as contemplated by COBS 12.2 of the FCA Handbook and is a research recommendation under COBS 12.4 of the FCA Handbook. Where it is not technically a res...

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