Southern Copper (SCCO) Surges 3.01% on Copper Rally Momentum: What’s Fueling the Move?

Summary
• Southern Copper (SCCO) trades at $147.79, up 3.01% intraday, hitting a 52-week high of $152.19
• Global X Copper Miners ETF (COPX) surges 60% year-to-date, signaling robust sector momentum
• Copper prices hit $12,405/ton on LME, driven by AI infrastructure demand and supply disruptions

Southern Copper’s sharp intraday rally aligns with a broader copper market surge fueled by AI-driven demand and tightening supply. The stock’s 3.01% gain—its strongest in months—reflects renewed investor confidence in the metal’s role in the energy transition and data center expansion. With COPX’s 60% annual return and SCCO’s 52-week high in sight, the move underscores a critical inflection point for copper miners.

Copper Supply Deficits and AI Demand Fuel SCCO's Rally
Southern Copper’s intraday surge is directly tied to global copper supply constraints and surging demand from AI infrastructure. Recent news highlights a 60% annual gain in the Global X Copper Miners ETF (COPX), driven by tightening supply chains and record LME prices. Analysts cite AI data center expansion as a key driver, with copper consumption projected to reach 43 million metric tonnes by 2050. SCCO’s operations in Peru and Mexico position it to benefit from this structural shift, while recent analyst upgrades and a 3.54% price target from Zacks reinforce bullish sentiment.

Copper Sector Gains Momentum as FCX Rises 2.19%
The copper sector is outperforming broader markets, with Freeport-McMoRan (FCX) rising 2.19% alongside SCCO’s 3.01% gain. LME copper prices hit $12,405/ton, up 41% year-to-date, driven by AI-driven demand and mine outages at Grasberg and Kamoa-Kakula. SCCO’s 29.99 P/E ratio lags FCX’s 32.1 P/E, but its geographic diversification and lower production costs in Peru and Mexico offer a competitive edge. Sector analysts project a 2026 deficit of 19 million tonnes, amplifying SCCO’s growth potential.

Options and ETFs to Capitalize on Copper's Bullish Momentum
• MACD: 3.11 (above signal line 3.42), RSI: 49.14 (neutral), Bollinger Bands: $137.26–$150.08 (current price near upper band)
• 200-day MA: $109.05 (well below current price), 30-day MA: $138.67 (support near $140.08)

SCCO’s technicals suggest a continuation of its bullish trend, with key resistance at $152.19 (52-week high) and support at $140.08. The stock’s 3.01% intraday gain and 3.54% price target from Zacks indicate strong near-term momentum. For leveraged exposure, consider COPX (60% annual return) or PICK (0.39% expense ratio, diversified metals exposure).

Top Options:
• SCCO20260116C150 (Call): Strike $150, Expiry 1/16/2026, IV 33.22%, Leverage 42.52%, Delta 0.47, Theta -0.2197, Gamma 0.0397, Turnover 5,436
- IV: Moderate volatility, Leverage: High potential for 117% payoff if price hits $155.78 (5% upside), Delta: Sensitive to price moves, Theta: Aggressive time decay, Gamma: High sensitivity to price changes
- This call offers a balance of leverage and liquidity, ideal for a 5% upside scenario. A 5% move to $155.78 would yield a 117% payoff, making it a top pick for aggressive bulls.

• SCCO20260116C155 (Call): Strike $155, Expiry 1/16/2026, IV 31.82%, Leverage 93.01%, Delta 0.2785, Theta -0.1601, Gamma 0.0349, Turnover 2,290
- IV: Slightly lower volatility, Leverage: Exceptional 140% payoff potential, Delta: Moderate sensitivity, Theta: Moderate time decay, Gamma: Strong price responsiveness
- This contract offers the highest leverage (93.01%) in the chain, with a 140% payoff if SCCO hits $163.13 (5% upside). Its moderate delta and high gamma make it ideal for a continuation of the current rally.

Action: Aggressive bulls may consider SCCO20260116C155 into a break above $152.19 (52-week high). For a more conservative approach, SCCO20260116C150 offers balanced exposure with strong liquidity.

Backtest Southern Copper Stock Performance
The backtest of SCCO's performance after a 3% intraday increase from 2022 to now shows favorable results. The 3-day win rate is 54.37%, the 10-day win rate is 54.17%, and the 30-day win rate is 58.83%, indicating that the stock tends to perform well in the short term following the intraday surge. The maximum return during the backtest period was 5.89% over 30 days, suggesting that there is potential for significant gains if the positive momentum continues.

Position for Copper's 2026 Supercycle: Buy SCCO or Call Options
Southern Copper’s 3.01% intraday surge reflects a structural shift in copper demand driven by AI and energy transition. With COPX’s 60% annual return and LME prices near record highs, the rally is far from over. Key levels to watch include $152.19 (52-week high) and $140.08 (30-day MA support). For immediate action, consider SCCO20260116C155 for high leverage or COPX for sector-wide exposure. Freeport-McMoRan (FCX)’s 2.19% gain reinforces the sector’s strength. Watch for a break above $152.19 or a pullback to $140.08 to initiate long positions.