Copper Mining Stock Slide Could Be Short-Lived

Mining name Teck Resources Ltd (NYSE:TECK) is 4% lower at $56.02 this afternoon, with copper stocks selling off amid rising crude prices and Middle East tensions. The shares have taken a 21% haircut off their June 2 record high of $71.25. This pullback could be short-lived, however, as a historically bullish signal is now flashing on the charts.

According to Schaeffer's Senior Quantitative Analyst Rocky White, TECK is trading within 0.75 times the 126-day moving average's 20-day average true range (ATR), after spending at least 80% of the previous two weeks and 80% of the prior 42 trading sessions above that trendline.

This setup has appeared six times over the last decade, after which the stock was higher one month later every time, averaging a 9% gain. From its current perch, a move of this caliber would put the equity back near $61. Todays drop also has support at $55. 

There is room for upgrades as well, per the nine of 16 brokerages following the stock that maintain a tepid "hold" recommendation. Should this bearish sentiment begin to unwind, it could trigger tailwinds for the shares. 

Lastly, Teck also sports an Schaeffer's Volatility Scorecards (SVS) reading of 94 out of 100. This suggests the stock has realized higher volatility than its options have priced in over the past 12 months.