Market analyst Regina Meani discusses Eagle Mountain Mining (ASX:EM2) and the copper price.
A copper focused exploration and development Company, Eagle Mountain Mining Limited (ASX:EM2 $0.77), has a strategic objective of becoming a low emission producer of high-grade Copper at its Oracle Ridge Copper Project in Arizona, USA. The company’s aim is to supply the rapidly growing green energy market. The company’s second project Silver Mountain, also in Arizona, has phase one drilling confirming the perspectivity for the project.
Arizona is the heartland of America’s mining industry and boasts some of the world’s largest copper discoveries, and has been mined by global companies such as BHP, Rio Tinto, Freeport McMoRan and Hudbay.
Last week saw the copper price move up strongly after breaking the downward trend from the May 2021 peak at US$4.89. The price had been consolidating sideways in a volatile fashion since mid-June. The breakaway occurred when the price moved up through $4.40 on 13 October. The upswing looks set to continue and test the peak zone in the $4.80-5.00 area and potentially push through to achieve significantly higher prices. The Eagle Mountain share price tracks the copper price closely (see the above chart) and has already begun to move higher towards the end of last week, in line with the copper move.
A price rise through 80c would complete a small consolidation phase and indicate the potential to tackle an initial barrier located at 88c and then in 95c- $1.00 area. Once clear the price would gain the ability to extend the upswing towards $1.20 and $1.60-70 and then possibly $2.00 and beyond. The risk would be a downward penetration of the main support in the 50- 57c range but with a change signalled on a drop below 67c.