I'm not trying to dog-pile on Freeport-McMoran Copper & Gold Inc (NYSE:FCX) here, but there is some major technical problems arising in this stock.
Up until yesterday, it was still a play you could take as a bounce off of support. Although, I didn't play it (simply because bounces off of breakout support usually happens quite rather and doesn't simply sit there), I wouldn't have blamed you for trying.
But lets make one more thing clear, the price action in FCX is why you use stop-losses. It is why you don't trust yourself to know when to get out, but you decide it before you ever get in the trade and you follow that stop-loss regardless.
On the technical analysis that I provide on FCX below, you will see that it has broken through a key support level, and while it is an important support level it isn't the critical level to watch. The most important support level lies between $10 and $10.23. If this level is broken, you have a massive double top that is formed.
If that happens, FCX could easily be heading back into $8-9 territory, or a 10-20% decline.
Manage your risk appropriately!
