Freeport-McMoRan Inc (NYSE:FCX) is down 3.1% to trade at $36.82 this afternoon, with the miner taking a hit as Covid-19 omicron variant fears push metal prices lower. As far as the security is concerned, however, there is no reason to panic just yet. In fact, Freeport-McMoRan stock could soon add to its healthy 57.5% year-over-year lead, given its latest pullback has the shares near a trendline with historically bullish implications.
Digging deeper, the equity just came within one standard deviation of its 40-day moving average, after some time spent above this trendline. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, at least five similar signals were observed in the past three years. FCX enjoyed a positive return one month later in 80% of cases, averaging an 11.1% gain. From its current perch, a move of comparable magnitude would place the security back above $40.
Analysts are still split on Freeport-McMoRan stock, with six calling it a "buy" or better, and the remaining six carrying a "hold" or worse, which leaves plenty of room for upgrades going forward. Meanwhile, the 12-month consensus target price of $42.19 is a 14.7% premium to the equity's current perch.
Additional tailwinds could come from a shift over in the options pits. This is according to FCX's 50-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 91% of annual readings, indicating puts are getting picked up at a faster-than-usual pace.
Plus, the equity's Schaeffer's Volatility Scorecard (SVS) stands at 82 out of 100. This suggests FCX has exceeded options traders' volatility expectations during the past year.