Freeport-McMoRan Surges 2.95% as Copper Demand Frenzy Ignites Market Optimism

Summary
• FCX trades at $58.2, up 2.95% from $56.53
• Intraday high hits 52-week peak of $58.715
• Sector news highlights copper supply concerns and AI-driven demand
Freeport-McMoRan’s sharp intraday rally reflects a perfect storm of technical momentum and sector-specific tailwinds. With copper prices surging on industrial demand and supply constraints, FCX’s 2.95% gain—its highest since 2023—has positioned it as a focal point for traders. The stock’s climb to a 52-week high underscores a broader narrative of electrification-driven commodity scarcity, as energy historian Daniel Yergin warns of looming copper shortages.

Copper’s Electrification Boom Fuels FCX’s Rally
The surge in Freeport-McMoRan’s stock is directly tied to the sector’s explosive demand for copper, driven by AI infrastructure, EVs, and renewable energy projects. Sector news highlights that copper’s role in electrification has triggered a supply-demand imbalance, with annual demand outpacing production by 1 million tonnes. Freeport-McMoRan, as the world’s largest copper producer, benefits from higher prices and long-term contracts. Additionally, the stock’s technical setup—a bullish RSI (75.37) and MACD crossover—has amplified short-term momentum, attracting algorithmic and institutional buyers.

Copper Sector Leaders Rally in Sync with FCX
The copper sector is experiencing a synchronized rally, with BHP Group (BHP) up 2.31% on the same day. Both FCX and BHP are capitalizing on the surge in copper prices, which have climbed to multi-decade highs due to supply constraints and green energy transitions. While FCX’s 2.95% gain outpaces BHP’s move, the sector-wide strength confirms that the rally is not isolated but rather a reflection of structural demand shifts. Investors are rotating into copper producers as central banks and policymakers prioritize electrification infrastructure.

Options and ETFs to Capitalize on Copper’s Bullish Momentum
• 200-day average: $41.96 (well below current price)
• RSI: 75.37 (overbought)
• MACD: 2.87 (bullish), Signal Line: 2.60
• Bollinger Bands: Price at $58.2 (above upper band of $57.32)
Freeport-McMoRan’s technicals suggest a continuation of its bullish trend, with key resistance at $58.715 (52-week high) and support at $57.16. The stock’s overbought RSI and strong MACD indicate short-term momentum, but traders should monitor for a pullback to the 50-day EMA ($51.27) as a potential entry point. While no leveraged ETFs are listed, the options chain offers high-conviction plays. Two top options stand out:

• FCX20260116C58 (Call, $58 strike, Jan 16 expiry):
- Implied Volatility: 35.76% (moderate)
- Lverage Ratio: 52.93% (high)
- Delta: 0.549 (moderate sensitivity)
- Theta: -0.287 (rapid time decay)
- Gamma: 0.162 (high sensitivity to price moves)
- Turnover: $180,273 (liquid)
Payoff at 5% upside ($61.11): $3.11/share. This contract balances leverage and liquidity, ideal for a continuation of the current trend.

• FCX20260116C59 (Call, $59 strike, Jan 16 expiry):
- Implied Volatility: 37.72% (moderate)
- Lverage Ratio: 83.18% (very high)
- Delta: 0.394 (moderate sensitivity)
- Theta: -0.237 (rapid time decay)
- Gamma: 0.149 (high sensitivity to price moves)
- Turnover: $54,163 (liquid)
Payoff at 5% upside ($61.11): $2.11/share. This option offers explosive potential for aggressive bulls, though its lower delta requires a sharper move to unlock value.

Aggressive bulls may consider FCX20260116C58 into a breakout above $58.715.

Backtest Freeport-McMoRan Stock Performance
The backtest of FCX's performance after a 3% intraday surge from 2022 to the present shows favorable results. The 3-day win rate is 53.57%, the 10-day win rate is 53.91%, and the 30-day win rate is 57.82%, indicating that the stock tends to perform well in the short term following the surge. The maximum return during the backtest period was 7.63%, which occurred on day 59 after the surge, suggesting that there is potential for significant gains if the positive momentum continues.

Copper’s Golden Hour: Position for a Sustained Rally
Freeport-McMoRan’s rally is underpinned by both technical strength and a structural shift in copper demand. With the stock approaching its 52-week high and the sector leader BHP up 2.31%, the momentum is likely to persist if copper prices hold above $4.00/lb. Traders should watch for a breakout above $58.715 to confirm the trend, while a pullback to $57.16 could offer a second entry. For options players, the FCX20260116C58 and C59 contracts offer high-reward setups. Watch for $58.715 breakout or a reversal below $57.16 to dictate next steps.