FCX plunged and is down by over 16% today – while you’ve been shorting it.
Good afternoon,
I decided to share my today’s second (intraday) Gold Trading Alert with you (in its entirety). In case you had or were considering shorting FCX based on some of my previous analyses, you might find this interesting:
FCX plunged and is down by over 16% today – while you’ve been shorting it.
Congratulations!
The direct trigger for this decline is this (quoting from Yahoo!Finance):
Freeport-McMoRan (FCX) faces significant challenges after a fatal accident at its Indonesian mine, leading to a drop in shares and a force majeure declaration.
While technical analysis doesn’t forecast accidents, it can tell, if an upcoming move (response to a trigger) is going to be significant, and moves in which direction are going to be magnified.
I wrote the following on the FCX just two days ago:
“The FCX was already after a top at that time. The same appears to be the case right now. (…) In fact, FCX just broke below its rising support line based on this year’s lows.”
Indeed, the top in the FCX was in. The November put options on it with the strike price of $40 (the ones that I’ve been featuring recently) are already in the money after rallying over 300% today.
Does my $24 target for the FCX still seem so “impossible”?
Absolutely not.
In fact, it’s even more likely given today’s slide. The copper hasn’t plunged yet and the USD Index hasn’t soared – those things are still ahead of us, and given today’s slide in the FCX, it seems that the latter will fall much further when we those moves materialize. If this seems unlikely, please look at what happened to FCX in 2008 and in 2015.
Those enormous declines CAN happen – they already happened in the past. These are not uncharted waters; it’s a well-known path lower.
Congratulations again, and thank you for your patience.
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Thank you.
Sincerely,
Przemysław K. Radomski, CFA
Founder
Golden Meadow®