While UK banks are struggling (see yesterday’s post), large-cap UK miners are enjoying a rebound.
BHP, for example, found support at 1,700p. This reaffirms its long-term uptrend, which is roughly delineated by the 150-day moving average (see below). A test of the April highs is underway.
Rio Tinto also affirmed its lateral support near 4,400p. Prices have not looked back after breaking the 4,000p psychological resistance earlier this year (see Featured Chart). Remember, big breakouts through major resistance levels are important and, if prices follow through, often lead to new uptrends.
Anglo American found support at 1,900p to pause the consolidation from 2,200p (see below). This level is reinforced by the long-term trend indicator. Thus further rallies into 2,100p is to be expected.
For Glencore, however, its price trend is looking distinctly opposite to the abovementioned miners. It has been struggling after peaked near 400p in January 2018. Prices touched multi-year lows just recently, hence I anticipate its relative underperformance to continue.
Overall, given their bullish long-term price trends, large-cap miners like BHP, RIO and AAL are expected to retest their year highs.
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Jackson has over 10 years experience as a financial analyst. Previously a director of Stockcube Research as head of Investors Intelligence providing market timing advice and research to some of the world largest institutions and hedge funds.
Expertise: Global macroeconomic investment strategy, statistical backtesting, asset allocation, and cross-asset research.
Jackson has a PhD in Finance from Durham University.