Wednesday, November 18, 2009

Freeport McMoran Copper & Gold (FCX) Potential Breakout Candidate; Cleveland Natural Resources (CLF) and Various Coal Plays (MEE, WLT) also Hot

I see a lot of extended charts out there as we move into what seems like day 82 of consecutive upside, along with some bond fide breakouts.  While we should only be so lucky to catch another Potash (POT), one chart that caught my eye last night was Freeport McMoran Copper & Gold (FCX). Much like Potash had key resistance at $106, FCX has some at $84.$85... which it sneaked a peak over in the closing moments of the day yesterday.  All it will take is some hammering of the US peso and off to the races she *might go*.

Her Peruvian brother in arms, Southern Peru Copper (PCU) is in a similar set up; here the magic number is "low $36s".

Some names from our past, that we have not touched in 15+ months are also in serious breaks - I offer to you Cleveland Cliffs (CLF) [iron ore], Walter Industries (WLT) [coal] and Massey Energy [coal].  Mmm... technically Cleveland Natural Resources is the new name on CLF.  These are "double top breakouts" galore.

CLF: $40 was the number here... a quick 10% gained post breakout

WLT: $68 was the number here; not a clean breakout (actually fell back below $68 very quickly on the 1 day we have sold off in the entire month of November, last Thursday)

MEE: Muy bonita! $35 was your key, a quick 15% since that breakout.

So what one hopes when you buy this sort of breakout i.e. Potash yesterday , or potentially a Freeport or Southern Peru Copper if either jump over resistance soon... is that in a week or so those charts will look like the 3 charts above.

As Jim Cramer says there is always a bull market in every asset on Earth other than the US dollar somewhere.

Egregious melt up anyone?  +7% on the S&P already in 1/2 of a month.... that annualizes to 170% return.  When does the bull trap ever rear its head again?

Long Potash in fund and personal account

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