Copper Charts Holding Up Nicely, Especially Southern Copper (COPX, FCX, JJC, SCCO, CU)
Tim Seymour: The copper miners (NYSEARCA:COPX) are shaping up well in terms of technical factors. The question coming up is whether this is another head fake or — at long last — the breakout move to the upside we have been looking for.
At this point, both Freeport McMoRan (NYSE:FCX) and the primary copper ETF (NYSEARCA:JJC) are back in position to challenge their respective 50-day moving averages again for the first time in nearly a month.
The last real push above the 50-day line earned JJC a 7% upswing before the bulls lost control of the copper market once again.
This time, we could once again be seeing a fake-out move. After all, the 200-day line is still way up in the sky at $51 on JJC.
FCX at least has some fundamental momentum going as it finally ramps back up production at its Grasberg mine. And at a scant 3.8 times enterprise value divided by EBITDA, it looks cheap as well.
Technically, Southern Copper (NASDAQ:SCCO) is the winner so far. This stock is well above the 50-day line and approaching its test of 200-day resistance at $31.63. After that, the sky is the limit — and its good news may spread to the rest of the copper (NASDAQ:CU) group.
Written By Tim Seymour From Emerging Money
Emerging Money provides insightful and timely information about the increasingly important world of Emerging Market investments. CNBC Emerging Markets Contributor Tim Seymour leads the team of Emerging Money to bring you cutting edge global news and analysis.
About Tim Seymour: Tim is a founder of Emerging Money. He is a founder and Managing Partner at Seygem Asset Management, and The Emerging Markets Contributor to CNBC. Seygem Asset Management focuses on investing throughout the global emerging markets asset class. With a view that emerging and developing economies will continue to outpace the economic growth and advancement of developed economies, Seymour has devoted a career to investing in the dominant markets of tomorrow, today. Seymour’s career has included significant experience in both alternative asset management (hedge funds) and capital markets, having launched two hedge funds, and built the largest Russian broker dealer in the USA. Seymour started his career at UBS, focusing on international credit (cash, swaps, forex) in a specialized hedge fund group (New York). Seymour completed the firm’s training program after graduating with an MBA in international finance from Fordham University. Seymour received his undergraduate degree at Georgetown University.