Freeport-McMoRan Plummets 2.13% Amid Sector-Wide Turbulence: What’s Fueling the Selloff?

Summary
• Freeport-McMoRan (FCX) trades at $41.83, down 2.13% intraday, with a 52-week high of $52.61 and low of $27.66.
• Sector peers like BHP Group (BHP) also decline by 2.06%, signaling broader metals and mining sector weakness.
• Options activity surges, with 19 contracts for the 38-strike put and 144 for the 40-strike put showing bearish positioning.
• Technical indicators suggest a short-term bullish trend but long-term consolidation, with RSI at 42.35 and MACD below zero.
Freeport-McMoRan’s sharp intraday decline reflects a broader selloff in the metals and mining sector, driven by mixed signals from lithium, copper, and uranium markets. With options data highlighting aggressive shorting and technical indicators pointing to a potential rebound, traders are navigating a volatile landscape shaped by sector-wide dynamics.

Sector-Wide Weakness and Commodity Volatility Drive FCX’s Slide
Freeport-McMoRan’s 2.13% intraday drop aligns with broader sector underperformance, as BHP Group (BHP) also declines by 2.06%. The selloff is fueled by mixed signals in critical commodities: lithium prices surge due to mine closures, while copper faces pressure from U.S. tariff threats. Additionally, uranium market volatility and gold import policy shifts create uncertainty. Despite FCX’s Q2 results showing resilience, the sector’s exposure to macroeconomic risks—such as interest rate expectations and geopolitical tensions—overrides company-specific fundamentals, triggering profit-taking and short-covering.

Metals and Mining Sector Under Pressure as BHP Mirrors FCX’s Decline
The metals and mining sector is broadly pressured, with BHP Group (BHP) mirroring FCX’s 2.13% decline. This synchronized drop highlights sector-wide vulnerabilities to commodity price swings and macroeconomic headwinds. While lithium and uranium markets show divergent trends, the sector’s reliance on cyclical demand and regulatory risks amplifies volatility. FCX’s copper-focused operations face added pressure from U.S. tariff threats, exacerbating the selloff.

Options and ETF Strategies for Navigating FCX’s Volatility
• 200-day average: 40.15 (below current price) • RSI: 42.35 (neutral) • MACD: -0.51 (bearish) • Bollinger Bands: 41.83 near lower band (38.18–46.85) • Gamma: 0.142 (high sensitivity to price swings)
FCX’s technical profile suggests a short-term rebound potential from the lower Bollinger Band, but long-term consolidation is likely. Key levels to watch include the 200-day MA at $40.15 and the 30-day support at $44.79. The RSI at 42.35 indicates oversold conditions, but the bearish MACD (-0.51) and low turnover rate (0.54%) suggest caution. No leveraged ETF data is available, but options remain a viable tool for directional bets.
Top Option 1: FCX20250822P41
• Contract Code: FCX20250822P41
• Type: Put
• Strike Price: $41
• Expiration Date: 2025-08-22
• IV: 38.76% (moderate)
• Leverage Ratio: 72.39% (high)
• Delta: -0.3328 (moderate bearishness)
• Theta: -0.0047 (low time decay)
• Gamma: 0.1422 (high sensitivity)
• Turnover: 5,080 (high liquidity)
This put option offers high leverage and strong gamma, ideal for capitalizing on a 5% downside move. A 5% drop to $40.00 would yield a payoff of $1.00 per contract, translating to a 28% return on the $3.55 premium. The low theta ensures minimal decay, while high gamma amplifies gains if the price accelerates downward.
Top Option 2: FCX20250822C41
• Contract Code: FCX20250822C41
• Type: Call
• Strike Price: $41
• Expiration Date: 2025-08-22
• IV: 38.76% (moderate)
• Leverage Ratio: 33.06% (moderate)
• Delta: 0.7423 (strong bullishness)
• Theta: -0.1216 (high time decay)
• Gamma: 0.1987 (high sensitivity)
• Turnover: 7,660 (high liquidity)
This call option is well-suited for a rebound scenario. A 5% upside to $43.92 would yield a payoff of $2.92 per contract, a 88% return on the $3.31 premium. The high gamma ensures rapid gains if FCX breaks above $41, but the high theta means time decay is a risk. Aggressive bulls should consider this if a rebound above $41.50 is confirmed.
Action Insight: Short-term traders should prioritize the 41-strike put for downside exposure, while directional bulls may use the 41-strike call if a rebound above $41.50 materializes.

Backtest Freeport-McMoRan Stock Performance
The backtest of FCX's performance after a -2% intraday plunge shows favorable short-term gains, with the 3-Day win rate at 50.31%, the 10-Day win rate at 48.13%, and the 30-Day win rate at 47.50%. While the returns over these periods are modest, with maximum returns of 2.16% over 30 days, the consistency of positive outcomes suggests that FCX can recover from such intraday dips to deliver moderate gains in the following days.

FCX’s Path Forward: Watch for Sector Catalysts and Key Levels
Freeport-McMoRan’s intraday selloff reflects broader sector pressures, but technical indicators and options data suggest a potential rebound from oversold levels. Traders should monitor the 200-day MA at $40.15 and the 30-day support at $44.79 for directional clues. The sector leader BHP’s 2.06% decline underscores the need for caution, but FCX’s high-gamma options offer tools to capitalize on volatility. A sustained break below $40.00 could trigger further selling, while a rebound above $42.50 may signal a short-term bottom. Watch for catalysts in lithium, copper, and uranium markets to determine the next move.