Exiting Our Position in Taseko Mines (TGB)
While copper futures prices remain firm, copper ETFs have come under renewed selling pressure late this week, thanks in part to persistent strength in the U.S. dollar and in spite of widespread hopes of additional monetary easing measures in China.
After an attempt at closing above the 25-day moving average, the Global X Copper Mines ETF (COPX) pulled back 3% on Friday as many leading copper stocks have broken below near-term supports and have shown abnormal weakness.
The relative weakness has been especially hard on Taseko Mines (TGB)—our sole exposure to copper right now—and the stock was down just over 3% as of Friday morning. TGB has underperformed the industry and I’m not pleased with its recent action. With that said, I suggest we sell our existing long position in TGB. I’ll have more to say about TGB and the copper group in next week’s regularly scheduled update.