How Has Resistance In Copper Prices Impacted Freeport-McMoRan Stock?

Freeport-McMoRan stock (NYSE: FCX) has rallied 12% in the last one month, outperforming the S&P 500 which was up 4.4% during this period. If you look at the change over the last ten days, FCX stock is up 9.2%, again outperforming the broader market. The rise in FCX stock was mainly driven by the fact that copper prices have remained strong despite the new coronavirus variant. With the onset of Omicron, major commodities, like oil, saw a decline in price. Copper was one of the few commodities which has remained resistant in the face of fresh curbs. This is because Omicron has not reversed the transition of the world to an era of a green economy, which is a long term process. Also, the demand for copper is likely to stay higher than supply in the medium term. Additionally, as a double advantage, with fears of fresh lockdowns and spread of Omicron, gold prices have seen an uptick over the last one month. With almost all of FCX’s revenues coming from copper and gold, the stock has rallied over recent weeks.

Now, is FCX stock set to rise further or could we expect some correction? We believe that there is a 58% chance of a rise in FCX stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on FCX Stock Chance of Rise.

Twenty-One Day: FCX 12%, vs. S&P500 4.4%; Outperformed market

(20% likelihood event; 58% probability of rise over next 21 days)

• FCX stock increased 12% the last twenty-one trading days (one month), compared to a broader market (S&P500) rise of 4.4%
• A change of 12% or more over twenty-one trading days is a 20% likelihood event, which has occurred 504 times out of 2515 in the last ten years
• Of these 504 instances, the stock has seen a positive movement over the next twenty-one trading days on 290 occasions
• This points to a 58% probability for the stock rising over the next twenty-one trading days

Ten Day: FCX 9.2%, vs. S&P500 3.9%; Outperformed market

(18% likelihood event; 51% probability of rise over next 10 days)

• FCX stock increased 9.2% over the last ten trading days (two weeks), compared to a broader market (S&P500) rise of 3.9%
• A change of 9.2% or more over ten trading days is an 18% likelihood event, which has occurred 444 times out of 2515 in the last ten years
• Of these 444 instances, the stock has seen a positive movement over the next ten trading days on 227 occasions
• This points to a 51% probability for the stock rising over the next ten trading days

Five Day: FCX -1.2%, vs. S&P500 0.1%; Underperformed market

(42% likelihood event; 50% probability of rise over next five days)

• FCX stock decreased 1.2% over a five-day trading period ending 01/03/2021, compared to the broader market (S&P500) rise of 0.1%
• A change of -1.2% or more over five trading days (one week) is a 42% likelihood event, which has occurred 1058 times out of 2516 in the last ten years
• Of these 1058 instances, the stock has seen a positive movement over the next five trading days on 526 occasions
• This points to a 50% probability for the stock rising over the next five trading days

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[1] Month-to-date and year-to-date as of 1/4/2022
[2] Cumulative total returns since 2017

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