Calling the Rally in FCX

by Mike Paulenoff
August 22, 2017 • 12:00 AM EDT
A week ago, we noted to our members to keep a close eye on Freeport-McMoRan Inc. (FCX).
The chart pattern argued for the price to thrust into a new upleg after completing a 3-week correction.
The correction, from 15.27 on July 26 to 13.81 on Aug 11, held key multi-month support, and positioned the chart into a bullish cup-and-handle formation.
Given the compelling technical set-up -- portending greater demand and inflationary pressures in copper and others metals -- we added FCX to our model portfolio on August 17 at 14.47.
The attached shows the pattern, which included a bullish flag and the start of what appeared to be break.
Five days later, JPM issued a bullish report about base metals prices, noting it is looking for better earnings in companies CENX, AA, TECK...and FCX!
Meanwhile, Jefferies strategist Sean Darby and team noted that materials stocks are "experiencing and enjoying underlying pricing power, a weak dollar, an expansionary China budget and M&A," even amid fears that President Trump’s infrastructure plans will be at delayed or eventually diluted.
All of which helped spur a rally to a high of 15.46 on Tuesday August 22, with the stock closing at 15.07.
Where is FCX headed next?
FCX thrust above its Jan.-Aug. resistance line on Tuesday morning, taking out its prior rally high at 15.27. As long as FCX can sustain above 15.00, the price structure projects directly to 16.60-17.00 next.
Mike Paulenoff is the author of MPTrader.com, a real-time diary of his technical analysis & trade alerts on
ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international
markets, plus key ETF component stocks in sectors like technology, mining, and banking.
Sign up for a Free 7-day Trial!
More Top Calls From Mike
Never a dull moment since January 20, 2025! This weekend, POTUS imposed 25% tariffs on Mexico and Canada, and 10% on China, which go into effect on Tuesday. From an initial market perspective, tariff trade war fears have triggered a risk-off reaction from Bitcoin-- the only highly liquid weekend market that can give us insight into what to expect for Sunday evening and Monday morning trading.
On December 27, 2024, with META trading at 595.26, this is what I posted to the MPTrader Discussion Room in response to a member's question:My pattern work from the October 2023 low at 279.40 to the December 2024 ATH at 638.40 (+128%) tells me that META is at a technical crossroad now... META's most recent upleg from the 11/19/24 low at 547.71 to the 12/11/24 ATH at 638.40 has the "right look" of a completed advance.
At the close of trading on December 18, 2024, this was my final thought posted to our discussion room at MPTrader.com:ES (March 2024 E-mini SP 500)-- Stating the obvious: Today's reaction to the FOMC Rate CUT (!!) inflicted serious near-term technical damage to the dominant, post-August uptrend... Last 5960.75...Thirty minutes after the close on December 18, 2024, I followed up with this commentary for MPTraders:My preliminary "conclusion" about today's outsized 3.
On December 20, 2024, this is what we discussed about the relentless four-week correction from NVDA's ATH at 152.89 (11/21/24) to a low at 126.35 on 12/20/24:Three Times is a Charm? For the third time this week, NVDA spiked down into the lower reaches of my optimal corrective target window from 132 to 125-- this AM representing the latest spike low at 126.35-- and for the third time, buyers emerged, propelling NVDA higher to 130-132. As we speak, NVDA is trading at 131.
On December 13, 2024, with NVDA trading at 132.54, down 13.3% from its All-Time High at 152.89 (11/21/24), and bearing down on a critical 8-week support plateau at 131-132, this is what I posted to MPTraders:NVDA Update: Approaching key support in the vicinity of 132 that if violated and sustained, could unleash the downside potential derived from a two-month top formation (everyone sees the Head and Shoulders formation by now).