Bull Signal Says Faltering FCX Could Soon Stage a Bounce

The shares of Freeport-McMoRan Inc (NYSE:FCX) are down 4.4% at $25.83 at last check, though the stock's earlier pullback was caught by long-term support at the 60-day moving average. Today's negative price action comes after two minor price-target cuts, with both Deutsche Bank and RBC lowering their price objectives by a dollar to $32 and $31, respectively. However, there is reason to believe that FCX could move back up on the charts.

More specifically, the stock just came within one standard deviation of its 40-day moving average, after spending most of 2020 well above this trendline. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, six similar signals have occurred during the past three years. One month after each signal, FCX was positive 83% of the time, averaging a swing of 15%. From its current perch, a move of similar magnitude would put the stock just shy of the $29 mark, closer to its Jan. 14 seven-year high of $32.48. 

Though the brokerage bunch is leaning bullish, there is still room for upgrades. Out of the 11 analysts in coverage, four carry a tepid "hold" rating on Freeport-McMoRan stock. 

Lastly, now seems like a decent time to weigh in on FCX's next move with options. The security's Schaeffer's Volatility Index (SVI) of 56% sits in just the 9th percentile of its annual range, meaning the stock is currently sporting attractively priced premiums.