Southern Copper Plummets 4.16% Amid Earnings Volatility and Sector Turbulence – What’s Next for SCCO?

Summary
• Southern Copper (SCCO) trades at $132.54, down 4.16% intraday, with a 52-week range of $73.37–$144.81
• Intraday swing spans $130.01–$133.63, with 200-day MA at $100.20 (far below current price)
• Options chain shows SCCO20251121P130 (Put) with 54.39% price change and SCCO20251121C140 (Call) with 76.95% leverage
• Sector leader Freeport-McMoRan (FCX) also declines 3.35%, signaling broader mining sector weakness

SCCO’s sharp intraday drop defies its recent earnings outperformance and copper price momentum. With the stock trading near its 52-week low and sector peers under pressure, investors must weigh technical breakdowns against fundamental resilience. The options market’s aggressive positioning and Bollinger Band compression suggest a pivotal moment for the stock.

Earnings Optimism Clashes with Macroeconomic Headwinds
SCCO’s 4.16% decline reflects a collision between short-term earnings optimism and macroeconomic uncertainty. While Q3 results showed record financial performance and a 15.2% revenue increase, broader market anxiety over Fed policy and rare earth supply chain developments overshadowed these positives. The stock’s 52-week low proximity ($73.37) and 200-day MA ($100.20) create a psychological anchor, while the options chain’s heavy put buying (e.g., SCCO20251121P130 with 54.39% price change) signals bearish conviction. Copper’s recent $11,200/mt peak also faces profit-taking pressure, compounding SCCO’s technical challenges.

Metal Mining Sector Under Pressure as Freeport-McMoRan Slides 3.35%
The Metal Mining sector faces synchronized weakness, with sector leader Freeport-McMoRan (FCX) down 3.35% intraday. While SCCO’s 4.16% drop outpaces FCX’s decline, both stocks reflect broader concerns about commodity demand moderation and interest rate sensitivity. SCCO’s exposure to copper and rare earths contrasts with FCX’s copper-centric model, yet both face headwinds from a flattening yield curve and speculative positioning shifts. The sector’s 30-day MA ($128.85 for SCCO vs. $17.50 for FCX) highlights divergent technical profiles, but the shared bearish momentum underscores systemic risk.

Options Playbook: Puts and Calls for a Volatile SCCO
• 200-day MA: $100.20 (far below current price)
• RSI: 60.11 (neutral to bearish bias)
• MACD: 5.47 (bullish divergence)
• Bollinger Bands: Lower band at $123.03 (critical support)
• Turnover Rate: 0.93% (moderate liquidity)

SCCO’s technical setup suggests a short-term bearish bias with long-term bullish potential. Key levels to watch: 1) $123.03 (lower Bollinger Band) as a critical support; 2) $130.01 (intraday low) as a near-term floor. The options market’s aggressive positioning (e.g., SCCO20251121P130 with 54.39% price change) indicates high conviction in a downside scenario. For leveraged exposure, consider the iShares MSCI Global Copper Producers ETF (COPX) to hedge against sector-wide moves.

Top Options Picks:
• SCCO20251121P130 (Put)
- Strike: $130 | Expiration: 2025-11-21 | IV: 47.88% | Leverage: 30.08% | Delta: -0.408 | Theta: -0.079 | Gamma: 0.0276 | Turnover: 9,572
- IV (47.88%): High volatility premium | Leverage (30.08%): Moderate gearing | Delta (-0.408): Balanced sensitivity | Gamma (0.0276): Strong price responsiveness
- This put offers optimal risk/reward for a 5% downside scenario (targeting $125.91). With high turnover and moderate leverage, it balances liquidity with directional exposure.

• SCCO20251121C140 (Call)
- Strike: $140 | Expiration: 2025-11-21 | IV: 37.48% | Leverage: 76.95% | Delta: 0.267 | Theta: -0.137 | Gamma: 0.0298 | Turnover: 2,960
- Leverage (76.95%): Aggressive upside potential | IV (37.48%): Fair volatility | Gamma (0.0298): Strong price sensitivity | Theta (-0.137): High time decay
- This call suits bullish traders expecting a rebound above $133.63. The 76.95% leverage ratio amplifies gains if SCCO breaks out of its consolidation pattern.

Action Insight: Aggressive bulls may consider SCCO20251121C140 into a break above $133.63, while bears should monitor SCCO20251121P130 for a test of $123.03 support.

Backtest Southern Copper Stock Performance
Key findings (2022-01-01 ~ 2025-11-04, 38 events when SCCO’s close-to-close change ≤ –4%):• Frequency: 38 qualifying plunges (≈1 event every 1.5 months). • Typical rebound: median next-day gain ≈ +0.3 %; 5-day cumulative return ≈ +1.7 %. • Longer horizon: 20-day cumulative return averages +4.4 % versus +2.2 % for a buy-and-hold benchmark; however, none of the horizons shows statistical significance at conventional confidence levels. • Win-rate peaks near day 22-23 (≈ 70 %), but fades thereafter. • No persistent alpha is evident; gains are moderate and noisy. • Risk perspective: the pattern suggests a short-term technical bounce after sharp sell-offs, yet edge is marginal—traders should combine with additional filters (e.g., oversold RSI, volume spike) or risk controls.Assumptions / auto-filled parameters: 1. Event definition: “daily close ≤ –4 % vs. prior close” (intraday data not available at daily frequency; close-to-close drop used as proxy). 2. Event window: ±30 trading days (user did not specify). 3. Price series: Close price. 4. Benchmark: SCCO buy-and-hold over the same window (default of engine). Interactive visual report attached—explore individual event paths and cumulative statistics.Feel free to explore the chart for deeper insights, or let me know if you’d like to tweak the event definition (e.g., −5 % threshold, intraday lows) or add risk-managed trading rules for a full strategy back-test.

SCCO at a Crossroads: Defend $123.03 or Rebound?
SCCO’s 4.16% intraday drop tests its 52-week low and critical Bollinger Band support at $123.03. While the stock’s fundamentals remain intact (Q3 revenue up 15.2%, operating cash cost down 44.7%), technical indicators and sector dynamics suggest a pivotal moment. The options market’s heavy put buying and SCCO’s 60.11 RSI reading signal near-term bearish momentum. However, the MACD’s 5.47 divergence hints at potential long-term bullish reversal. Investors should closely monitor Freeport-McMoRan (FCX)’s -3.35% move as a sector barometer. Act now: If $123.03 holds, consider SCCO20251121C140 for a breakout play; if it breaks, SCCO20251121P130 offers downside protection.