Southern Copper Surges 3% on Copper's Record High and Earnings Optimism: Can This Bullish Momentum Sustain?

Summary
• Southern Copper (SCCO) rockets 2.99% to $148.29, hitting its 52-week high of $148.925
• Copper prices climb to fresh record highs post-Fed rate cut, driving industrial metals rally
• Zacks upgrades earnings estimates for 2025, with consensus EPS growth of 12.9%

SCCO’s intraday surge reflects a confluence of macroeconomic tailwinds and sector-specific optimism. With copper prices surging on Fed easing and electrification demand, SCCO’s technicals align with a bullish breakout. The stock’s 30-day RSI of 80.35 and MACD crossover above 1.82 signal strong near-term momentum, while options activity highlights aggressive call buying at key strike levels.

Copper’s Record High and Earnings Revisions Fuel SCCO’s Rally
Southern Copper’s 3% surge stems from two pivotal drivers: copper’s record-breaking price action and upward revisions to earnings estimates. The Fed’s rate cut and upgraded U.S. growth forecast have ignited demand for industrial metals, with copper hitting $11,872/ton on the LME. SCCO’s exposure to electrification-driven demand—EVs and renewable energy—amplifies its upside. Meanwhile, Zacks notes a 0.9% 30-day increase in 2025 consensus EPS to $5.86, reflecting optimism about production efficiency and molybdenum/silver byproduct gains. The Zacks Rank 3 (Hold) suggests earnings revisions, not just macro trends, are anchoring this move.

Copper Sector Soars as Freeport-McMoRan (FCX) Leads with 3.3% Gains
The copper sector is in full rally mode, with Freeport-McMoRan (FCX) surging 3.32% and Antofagasta (ANTG) rising 2.1%. SCCO’s 2.99% gain aligns with the Zacks Mining - Non Ferrous industry’s 6.8% monthly outperformance. Copper’s structural deficit—driven by 2.6% annual demand growth and 50% shortfall in new mine projects—positions SCCO’s 13.7% revenue growth forecast as a sector bellwether. However, SCCO’s 30.16 P/E ratio lags FCX’s 28.4, suggesting valuation caution despite earnings optimism.

Capitalizing on SCCO’s Breakout: ETFs, Options, and Key Levels to Watch
• MACD: 3.04 (bullish crossover above 1.83 signal line)
• RSI: 80.35 (overbought, but supported by strong volume)
• Bollinger Bands: Price at 148.29 (above upper band of 146.53)
• 200D MA: 105.26 (price at 148.29, 40% above)

SCCO’s technicals scream continuation. Key support at 138.23 (30D support) and resistance at 148.925 (52W high). A break above 148.925 targets 155.00, while a drop below 138.23 could trigger a pullback to 132.88 (middle Bollinger Band).

Top Options Picks:
• SCCO20251219C150
- Strike: $150, Exp: 12/19, IV: 34.82%, Leverage: 57.34%, Delta: 0.44, Theta: -0.31, Gamma: 0.0486
- Payoff: At 5% upside (155.70), payoff = $5.70/share. High leverage and moderate delta make this ideal for a 5-day rally.
• SCCO20260116C150
- Strike: $150, Exp: 1/16, IV: 39.08%, Leverage: 21.84%, Delta: 0.498, Theta: -0.13, Gamma: 0.0215
- Payoff: At 5% upside, payoff = $5.70/share. Longer-dated option offers time decay protection while capturing gamma-driven gains.

Action: Aggressive bulls should buy SCCO20251219C150 for short-term gains. Conservative traders may use SCCO20260116C150 as a hedge against volatility. Watch for a close above 148.925 to confirm the breakout.

Backtest Southern Copper Stock Performance
The backtest of SCCO's performance following a 3% intraday surge from 2022 to the present indicates positive short-to-medium-term gains, with the 3-Day win rate at 55.36%, the 10-Day win rate at 55.16%, and the 30-Day win rate at 59.92%. The maximum return observed was 5.76% over 59 days, suggesting that while there is volatility, SCCO can exhibit favorable performance in the immediate aftermath of such an increase.

SCCO’s Bull Case Gains Legs: Ride the Copper Wave or Secure Profits?
Southern Copper’s rally is underpinned by a perfect storm: copper’s record highs, electrification tailwinds, and earnings optimism. The stock’s 30-day RSI of 80.35 and MACD above 3.03 suggest momentum is intact, but overbought conditions demand caution. Freeport-McMoRan’s 3.3% surge underscores the sector’s strength. Investors should monitor SCCO’s ability to hold above 138.23 (30D support) and 148.925 (52W high). For those with a bullish bias, the SCCO20251219C150 option offers a high-leverage play on a 5% upside scenario. If the 52W high breaks, this move could signal a new chapter for SCCO’s bull case.