The large-cap, big name stocks are all you hear about in the media. You know the names… After listening to the hype, you’re probably salivating to buy some of these big name stocks.
However, $600, $100 and even $50 stocks are just out of most investors reach…
If you can’t justify paying the big price tag, not to worry… we have a small-cap penny stock alternative you can buy instead. Not only will it cost less, you’ll be able to buy more shares!
This week we’re giving you a less pricy way to play the rebound eminent in copper. If you didn’t know, copper prices have been on the ropes for quite some time- but some experts believe that’s about to change.
In fact, CNBC recently reported the HSBC flash manufacturing (PMI) hit a four-month high of 50.1 in August. That’s up from a reading of 47.7 in July.
Remember, a reading above the 50 threshold identifies expansion of manufacturing activity.
This continued improvement in Chinese economic data leads many analysts to believe we may see a rebound in basic materials pricing… and that includes copper.
We tend to agree with that sentiment…
In addition, copper looks poised for a technical breakout of sorts in the very near future. Take a look at the four year chart of spot copper prices below to see for yourself.
As you can see, copper hasn’t traded below $3.00 for years now (see the two lows in spot pricing circled in red). That means as copper nears the $3 level, buyers rush in to snatch up a bargain.
Also, the chart is now in a flag pattern (see green lines). This means we’re approaching a breakout in the near future as both lows and highs are narrowing.
This move can be either higher or lower if the pattern follows form. But given the pickup in Chinese manufacturing activity (PMI’s 4 month improvements), we’re trending toward a breakout higher… not lower.
To take advantage of this pending rebound in copper prices, I’ve found a small cap copper mining company out of Canada that is poised to take advantage.
Augusta Resource (AZC)
Augusta Resource Corporation owns 100% of the Rosemont project, a copper mining project with copper/molybdenum/silver deposits. This property is comprised of 30,000 acres of patented and unpatented claims, and fee land and surface grazing rights located in Arizona.
So what makes AZC a buy?
As I previously pointed out, Chinese economic activity is picking up. Additionally, technical analysis is pointing toward a big move soon. And companies directly related to the spot price of the metal are those that will benefit.
Since AZC is a company with copper mining assets, the spot price is the primary factor set to move the stock.
With that said, if you’re looking for a penny stock to buy that is set to benefit from the rise in spot copper prices, consider picking up shares of AZC.
Keeping you one step ahead,