Rio Tinto Group (RIO) mines iron ore, copper, aluminum, lithium and other materials that are needed to keep our lifestyles going. I believe that in the next five to 10 years we are going to see many shortages of materials. The price of copper and other metals could move significantly higher, in my opinion.
Let's check out the charts of RIO.
In the daily bar chart of RIO, below, I see a very broad sideways movement for the stock over the past 12 months. The trading volume has remained active. The On-Balance-Volume (OBV) line has roughly moved up and down with the price action the past year.
The Moving Average Convergence Divergence (MACD) oscillator has made a higher low in April versus March. The oscillator is poised to cross to the upside for a cover shorts buy signal.
In the weekly Japanese candlestick chart of RIO, below, I can see some positive developments. The two most recent candle patterns show us lower shadows telling us that traders are rejecting the lows. The shares are just slightly below the 40-week moving average line.
The weekly OBV line shows a very modest decline the past three months. The MACD oscillator is pointed down but has not crossed below the zero line.
In this monthly line or close only chart of RIO, below, we can see the price action going back to 1990. In the past two years the $80 area has stopped or stalled the long-term trend. Strength above $80 should refresh the longer-term advance.
In this daily Point and Figure chart of RIO, below, it is projecting a potential downside price target in the $60 area. A trade at $70 should refresh the uptrend.
In this weekly Point and Figure chart of RIO, below, I see a downside price target in the $58 area.
Bottom-line strategy: RIO has an impressive dividend yield around 7.62%. Add in the possibility of future price gains and the total return is very attractive. Traders could go long at current levels risking to $60.
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