Copper Prices, Analyst Confidence Lift FCX Stock

FCX has been trending higher since last month's low

Sep 13, 2019 at 10:18 AM
facebook X logo linkedin

Freeport-McMoRan Inc (NYSE:FCX) has been trying to recover from last month's 52-week low of $8.59, and today the shares are on the rise again. Helping their cause is rising copper prices, along with upbeat attention from Wall Street analysts. Specifically, Jefferies in a note this morning said the mining sector could see a recovery in demand soon, especially if the U.S. and China strike a trade deal. The brokerage firm said FCX stock is undervalued, and it could benefit from the company's operations in Indonesia.

In response, the security is trading up 2.8% at $10.66, putting it on pace to close above the 50-day moving average for the second time since Aug. 1. The 200-day moving average should also be on traders' radars, since this trendline, positioned at $11.33, blocked the equity's breakout attempt in July.

Call options traders certainly have been aggressive toward Freeport, with many targeting the stock for a potential breakout. Data from the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows a 10-day call/put volume ratio of 6.98, a reading that ranks in the 93rd annual percentile. In other words, there's been huge demand for long calls.

Looking closer, the October 11 call saw the largest increase in open interest by far during that two-week time span, with more than 20,700 contracts added. Heavy buy-to-open activity can be confirmed here, showing many have been betting on FCX shares taking out $11 in the weeks ahead.

For perspective options traders, premiums look attractive at the moment, since the 30-day at-the-money implied volatility of 39.9% ranks in the low 20th annual percentile. Early on today, calls are indeed crossing at an accelerated rate, though that may be due to closing activity at the aforementioned October 11 call.



Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI