SCCO, Short-term Support lineOne of our open positions, we will close it if the price drops below the red line.
SCCO
How EV's affect Copper, trend should continue immediately!The copper trend should commence once overhead resistance is taken out. Wave 3 should bring us to $3.42 per lb before our ultimate target of $3.50 - $3.60 later this year!
Retested daily breakout, looks bullishAlthough SCCO completed the bearish gartley, the pullback tested the daily breakout. Should keep above the daily trendline and go for a new high. This move is playing on weekly double bottom so very likely for bullish continuation.
Strong resistence cluster around the 30 mark, supply. If this breaks look for 35.63 harmonic target on bearish crab.
Expecting a ReversalHISTORY:
Southern Copper Corporation ("SCCO/NYSE") is one of the largest integrated copper producers in the world. They produce copper, molybdenum, zinc and silver. All of their mining, smelting and refining facilities are located in Peru and Mexico and they conduct exploration activities in those countries and in Argentina, Chile and Ecuador. Their operations make them one of the largest mining companies in Peru and Mexico. They might have the largest copper reserves in the world. They were incorporated in Delaware in 1952 and have conducted copper mining operations since 1960.
TECHNICAL:
NOT ONLY we are approaching nice technical levels to look for short opportunities, i.e.
33.20 is 50% retracement and
35.25 a 61.8% of retracement level of the impulsive leg (from 42 to 25)
AND
price is testing declining trend-line.
FUNDAMENTAL:
It seems that the fundamentals are also in favor of this trade.
The slow down in China's growth and it's declining Copper import will support this idea. You could read more on this in (harrydent.com)
In addition to this,
i) Southern has the highest price-to-earnings (P/E) ratio among its peer. This is a classic measure of “value,” showing Southern is currently not a good one.
ii) Southern’s price-to-sales (P/S) and price-to cash (P/C) ratios — two other measures of valuation — are also one of the highest of all copper miners.
iii) Again, Southern’s price-to-book value (P/B) is higher than each of its peers. In fact, it’s about 270% higher than Freeport-McMoRan’s and 825% higher than Sterlite, an Indian miner!
iv) Southern’s debt-to-equity ratio, a measure of its debt load, is higher than any of its peers. It’s more than four-times worse than Freeport-McMoRan’s.
CONCLUSION:
This is a long term trade, and it is most likely that this stock test the lows of 2009 below $10.
P.S.
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$SCCO looks very bullishCould be a definitive EW4 with RSI div. although wick below 50fib. still closing above. A beginning of EW5, perhaps? We'll see this week.
All Targets Hit ... New Bearish Targets | #Copper #AMEXFriends,
This past March 11th 2014, I offered two distinct forecast targets, namely:
1 - TG-1 = 35.20 - 11 MAR 2014
and
2 - TG-2 = 38.60 - 11 MAR 2014.
This trade was particularly tricky, as it called for one bearish target and a bullish counter-trend. However, it turned out that it hit both targets with some respectable accuracy - See original chart posted here: . Also, see second commentary in this link, where it was posted on TradingView: .
As of this day, I remains bearish on the metal, not only based on my predictive analysis/forecasting model, but principally based upon the fundamentals behind this economic indicator. First, the fact that China is expected to continue to default on copper-leveraged growth that has been feeding insanely into a bubble-fed ghost towns is one well documented clue. Also, Goldman-Sachs has recently turned around its long positions, now looking to short the metal (recent future short position action). Additionally, Europe continues to act as a declining market for the Chinese economy - All of these bearish markers are dots on a declining charts if one day we had to look back into a failing mechanism of inter-market disengagement on the part of bulls. Plus, let's also welcome Europe to the race to the bottom, as it recently has taken dire steps to weaken its currency. Now that most significant economies are trying to catch up with Japan's self-destructive behavior, the race to disinflation is about to ramp up towards the next chapter: Commodity deflation.
NEW TARGETS:
As of today, based on a the predictive/forecasting model, which holds no sentimental or fundamental knowledge about either the market or world-stage events, its directional bias remains bearish.
New bearish targets are:
1 - TG-3 = 33.23 - 10 JUN 2014, moderate probability
and
2 - TG-Lo = 32.42 - 10 JUN 2014, low probability.
As mentioned before, the low-probability target holds two functions: One is to remind that this price point requires a significant amount of bearish participation to ever be attained. Second: IF and ONCE it is attained, it is likely to act as a significant S/R or reversal level.
Cheers,
David Alcindor
Predictive Analysis & Forecasting
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Twitter: @4xForecaster
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