Freeport-McMoRan Faces Tough Times: Technical Signals Point to Trouble FCX recently recorded a troubling technical indicator known as a Death Cross. This occurs when the 50-day exponential moving average falls below the 200-day average, often signaling potential for extended price declines. Following this trend, FCX’s recent stock performance raises concerns among investors.

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Over the past six months, FCX stock has dropped by 12.06% and has seen a decline of 16.11% over the last year, highlighting an ongoing downward trend.

Moreover, FCX has been trading below its five, 20, and 50-day moving averages. Although recent news from Indonesia has pushed the stock above its short-term moving averages, the negative MACD reading of -0.77 and RSI of 46.22 indicate a neutral momentum, potentially leaning towards oversold territory.

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Copper Demand vs. Operational Challenges

The company’s struggles can largely be attributed to its operations in Indonesia, which are encountering serious hurdles. Freeport-McMoRan is currently negotiating for an export permit that aims to help alleviate global copper shortages, a situation worsened by issues faced by competitors like First Quantum. Additionally, the Manyar smelter—integral to Freeport’s operations—remains offline since a fire in October, with repair efforts not expected to conclude until mid-2025.

Despite these operational setbacks, copper remains crucial for green technologies and infrastructure projects, keeping Freeport under the investor spotlight. Securing increased export quotas could offer a brief relief from supply constraints. However, Indonesia’s emphasis on domestic processing reveals a growing trend among resource-rich countries focusing on local value generation over raw material exports.

Implications for FCX Stock Investors

The recent Death Cross alongside prevailing market pressures signifies potential short-term risks for FCX stock. Although there is a chance that export permission could boost its outlook, current technical signals suggest a bearish trend is likely to persist.

Copper’s essential role in global markets assures Freeport’s long-term relevance, but current investors in FCX stock may need to adopt a patient and cautious approach during these turbulent times.

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Image created using artificial intelligence via Midjourney.