Southern Copper Corp. (SCCO) is bumping up against key resistance and the $64,000 question is if prices will break out on the upside. Let's put on our miner's cap and check out the charts and indicators.
In this daily bar chart of SCCO, below, I can see that prices made a four month bottom in the July-November time frame before taking off to the upside. SCCO is above the rising 50-day moving average line and above the rising 200-day line as well.
The daily On-Balance-Volume (OBV) line shows strength from early August as buyers of SCCO have been more aggressive than sellers. The trading volume histogram shows active turnover the past year. The Moving Average Convergence Divergence (MACD) oscillator is just slightly above the zero line.
In this weekly Japanese candlestick chart of SCCO, below, I can see the past three years of price action. Prices have run into resistance in the $80-$85 zone or area. A move above this zone will be an important upside breakout. Prices trade above the rising 40-week moving average line. The weekly OBV line has been moving sideways for two years. The MACD oscillator is above the zero line but could turn up or down easily from here.
In this daily Point and Figure chart of SCCO, below, I can see that a trade at $79 should refresh the uptrend and open the way to a potential $91 price target.
In this weekly Point and Figure chart of SCCO, below, a downside price target in the $60 area is shown. Here too, a trade at $79 should refresh the uptrend.
Bottom line strategy: I reviewed SCCO on March 1 writing, "Traders who are long SCCO from our previous recommendations should continue to hold. Raise stops to $65. The round number of $100 is our nearest price target."
Traders should continue to hold longs. Keep the stop at $65 and consider adding to longs on strength above $79.
