“Resource stocks underperformed last year due to limp growth in China and the market finding more exciting stocks to invest in, such as technology and financials,” Michael said.
“However, underinvestment in commodities leads to supply issues.
“When we match that with improved growth from China and the rest of the world, you get a situation where undervalued resource stocks pass their cyclical trough and rally again.
“From late 2024 to early 2025, BHP had a support level just above $38.
“It broke under that in April, before bouncing back and finding resistance at that old support line.
“Instead of being sold off heavily near resistance, BHP spent most of the past couple of weeks consolidating under that blue line, which is a bullish sign.
“This week it started to edge out of this consolidation and back above the blue line.
“This is a new buy trigger, and BHP should recover well from here,” Michael said.
BHP Graph
