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Fan Yang

Southern Copper Corp. (SCCO) Confirming a Price Bottom

As copper $CA prices have risen lately, so has the share price of Southern Copper Corp. $SCCO

Copper Daily Chart

(click to enlarge)

Copper Turning Bullish?
- Copper price action was bullish in 2017, but stalled in 2018. After being in a choppy sideways consolidation for the first half of the year, price slide in the second half and entered a lower consolidation range.
- Price has been trading between roughly $2.55 and $2.85. 
- In February, we saw price climb above this resistance. With price now back above the cluster of moving averages and the RSI being able to push above 70, it looks like Copper could be entering a bullish mode. 
- Maybe it's not a bullish market, but still not a bearish one anymore. The larger range is now between the 2018/2019 low of $2.55 and the 2018-high around $3.30. With this perspective, the $2.90 area, where price is right now, is the central pivot. 
- But from the longer-term perspective, we know that the 2018/2019 low is above the 2017-low, giving long-term copper price action some bullish bias. 
- Thus, we should anticipate support in the moving average cluster, around $2.70-$2.80. We can also anticipate upside towards highs around $3.30. 

SCCO Daily Chart

(click to enlarge)

Price Bottom; Upside:
- We can see that price has completed a bottom that has been developing since late November. 
- Price also broke above a falling trendline resistance. 
- The first key resistance will be around $39-$40, a previous support pivot, a psychological level, and where the 200-day simple moving average resides at the moment.
- Let's say price retreats from there. If the market is still bullish, it should support price at or above $34. 
- In this scenario, there could be upside towards the $44-$46 area. I would limit the bullish outlook to this key "sticky" area, where price has been finding common pivots since late 2017. 

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