Sunday, February 20, 2011

Will the World Greatest Mining Company Resumes its Upward Move?

 Well, another billion $ question. A regular visitor to The Market Oracle would like to seek some advise on one of the world greatest mining company Freeport Mcmoran Copper and Gold (FCX) whether the current run up will continue or is this giant going to tumble.

Click on the above image to enlarge

Well, as usual my technical analysis will begin with the long term chart. It appears this giant FTX has met the the Great Wall of Mining which is at $61. This level is also the multiyear resistance which is very hard to be broken. True enough, after it flirted with the $61 level, it begins to tumble badly.
Click on the above image to enlarge

Based on the short term chart analysis, which I think is more important than the long term chart, it shows that this giant FCX will head to the 1st support at $48. If I were to rate the possibility of it happened, I would say that I am 80% sure. In other words, it is 80% out of 100% that it is heading to the $48 level.

Both MACD and Stochastic show that this chart willl continue to tumble until these technical indicators finds the resting area below which is towards the lower side. Until then, it will not rebound and head further upward.

As can be seen from every one of the huge downward candle, it tumble with higher volume than the volume of the upward candle. It clearly means that the bear is clearly dominating the bull.

Also the upward trend line is currently clearly broken.

Click on the above image to enlarge

Based on this very simple and clear fundamental analysis, the quaterly earning shown an upward trend, the latest quarterly earning also successfully beat the analyst estimates.

Based on this strong improvement in the quaterly earning, this is one and only reason I will say that this stock will rebound after touching the 1st support at $48.

It is also a good reason for the stock operators to push the stocks downward and to clear the weak holders before it resumes its upward trend.

Whether or not this stock will rebound and move upward is a big question that is difficult to answer, however, to test the technical support of $48, I am very sure that it will definetely happen.

Disclaimer : This is not an investment advisory, and should not be used to make investment decisions. Information in The Market Oracle Blog is often opinionated and should be considered for information purposes only. No stock exchange anywhere has approved or disapproved of the information contained herein. There is no express or implied solicitation to buy or sell securities. The charts provided here are not meant for investment purposes and only serve as technical examples. Don't consider buying or selling any stock without conducting your own due diligence. 

1 comment:

  1. Gold mining companies like freeport Mcmoran could be one of the greatest bargains out their. Gold stocks have not moved as much as the metal itself.


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