close icon

Freeport vs Indonesia: The Elliott Wave Outlook

It looks like Freeport is going to end up as a winner in the Grasberg saga

Exports from Indonesia’s Grasberg copper mine have been halted for 10 weeks now. As a result, shares of Freeport-McMoran, one of the world’s largest copper producers and majority stake owner of the mine, recently declined from $17.06 in January to $11.92 this Monday. And while the company is still negotiating the terms of a new export deal with the country’s government, the Freeport’s hourly price chart is already pointing higher for the stock.
elliott-wave-chart-freeport-mcmoran
The chart allows us to put the recent plunge into a proper Elliott Wave perspective, in order to see where it fits into the big picture count. As visible, Freeport-McMoran stock rose from a low at $9.24 in mid-October, 2016, to as high as $16.42 forty days later. More importantly, that recovery took the shape of a five-wave impulse, which means the trend is up. According to the theory, a three-wave correction follows every impulse. Here, we could easily recognize an expanding flat correction, whose wave B makes a new swing high at $17.06. In this respect, the selloff people think was caused by the Grasberg mine dispute is actually a natural impulsive wave C, which completes the entire wave (2) corrective sequence exactly at the 61.8% Fibonacci level! What a coincidence!

If this analysis is correct, Freeport’s 5-3 wave cycle is complete and the trend could be expected to resume in the direction of wave (1). The solution to Freeport’s problems in Indonesia remains unknown, but “the habit of the market is to anticipate, not to follow.” Right now, it seems to be anticipating a happy ending for the miner. Let’s see…



Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

Avoiding the 54% Crash in Brookfield Partners

When we last wrote about Brookfield Partners, the stock was hovering around $44 a share. That was on July 27th, 2019. Back then we though the price can reach $50, but instead of celebrating, the bulls should be getting ready to leave. The reason for our skepticism wasn’t some special insight into the company’s operations…

Read More »

Alphabet Stock To $1700 and… Below?

Similarly to the market at large, Alphabet stock felt the tremors caused by the coronavirus panic. The Google parent’s share price fell from $1531 to $1009 between February 19th and March 23rd. One of the biggest and strongest companies in the world lost 34% of its value in a little over a month. However, thanks…

Read More »

Sidestepping the 55% Crash in Steel Dynamics Stock

It’s been a little over four months since we wrote about Steel Dynamics. On January 16th, the stock was hovering around $33 a share. The price was down 37% from its May 2018 peak at $52.10. Yet, despite the reduced price, we thought investors would be better off avoiding the name. Our bearish opinion was…

Read More »

Omnicom Bears Face Strong Fibonacci Support

Yesterday, we talked about Interpublic and how Elliott Wave analysis warned us about its stock’s collapse two years in advance. Today, we are going to focus on Omnicom, which looked vulnerable to us in March 2018, as well. Omnicom rose from $20.09 to $89.66 between March 2009 and December 2016. The stock took full advantage…

Read More »

Two Years Ahead of Interpublic ‘s 55% Collapse

Interpublic and Omnicom used to be the giants of the advertising world. In the old economy, their competitive advantages seemed indestructible. Then, the Internet revolution came along and Facebook and Google created a lot of problems. However, their stocks were still making new highs until two years ago. Interpublic stock, for instance, was hovering around…

Read More »

Nestle Set to Complete a Pattern it Started in 2003

Nestle S.A. is one of the largest companies in the world and the biggest food and drink producer by revenue. The company is headquartered in Switzerland and went public in 2001. The stock’s all-time low was reached in March 2003, when it fell to CHF 23.32 a share. Seventeen years later now, Nestle stock is…

Read More »

Bulls to Lift Mondi Stock to New Highs

We first wrote about Mondi plc, the paper and packaging company, almost a year ago. On May 5th, 2019, the stock was hovering above 1700 pence per share. Despite being down 25% from its all-time high already, we thought it was too early for investors to buy the dip. Our pessimism was based not on…

Read More »

More analyses