Metals Signaling Reversal? (XME, X, FCX, AA)

Traders and investors often say that economically-sensitive materials and mining stocks will lead any rally or downturn in the stock market. Well, today many materials and miners are in the green despite the major averages being solidly in the red. The SPDR S&P Metals & Mining ETF XME is up $1.40, or 2.92%, to $49.37 on the day. U.S. Steel is up $1.89, or 4.14%, to $47.53. Freeport-McMoRan FCX is up $2.05, or 3.13%, to $67.61. Alcoa AA is up 21 cents, or 1.85%, to $11.30. Many of these stocks have been beaten down over the last month. Therefore, it is hard to tell if investors are just bargain hunting, shorts are closing out positions, or that a key reversal is taking place. Either way, it pays to watch the action in the metals space because they will signal when the correction is over.