Chart of the Week: Southern Copper
Hey good morning everybody. Happy Wednesday. It’s time for our chart of the week. It’s February 25. We’re gonna focus in on a copper name called Southern Copper; SCCO is the symbol. Let’s take a look at this chart. It’s been pretty strong.
And of course we’re gonna take a look at the metal copper, too.
First of all, let’s look at that.
As you can see here, the chart of copper has been super strong since last summer. And you can see how the metal has been making higher highs and higher lows all the way up to all-time highs, about $650.
It peaked up there at the end of January, and it’s come down a little bit to make a little handle here from this cup pattern. We can see here a little bit of a pullback on lower turnover – lower volume is always very healthy.
We see relative strength is coming down a little bit here too.
But let’s go to the stock here, which actually looks a lot better than the metal itself.
You can see here that over the past couple of months, the stock has made a nice run higher and also has a cup and handle pattern. And just recently is trying to break out of that pattern over here. And once it breaks out above the top of the base, it’s going to make a move much higher, probably up to about $245-250. We see another 20-25%.
What you like to see is when a stock is in the handle part of the cup and handle pattern, in trying to base, is you want to see volume coming down. And that’s what we saw down over here. That’s what you like to see. You don’t want to see high volume when we’ve made highs, and we’re consolidating up here. That means the big money is starting to leave the stock.
Now obviously the indicators are not as positive as you would think.
Let’s look at this MACD over here. It was on a huge buy signal from the beginning of 2026. The stock really took off from about $135 up to about $200. Better than a 40% move up in Southern Copper.
One of the things I like about Southern Copper here is it’s a pure play on copper. There’s only a few public companies out there that are pure plays.
Freeport McMoRan – FCX – is not a pure play, because they are gold, copper and oil. Copper obviously one of the biggest components of that company after they made a big acquisition about a dozen years ago.
But I like Southern Copper over here. Not only is the chart strong, but also has a really nice dividend yield, too.
And again, I think that as long as copper stays strong and in demand, we’re gonna see higher prices here from Southern Copper.
So take a look at this one.
Thanks so much for watching everyone, and I”ll see you guys next time.
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