Freeport-McMoRan Inc. (FCX) shares are trading lower Monday after hitting a wall around $53. If you've been watching this stock for a while, that number should ring a bell.

There are some old Wall Street sayings that actually make sense when you understand the psychology behind them. Two of them are playing out in real-time with Freeport, which is why it's worth paying attention to.

The Ghost of Tops Past

First up: "sell at former tops." It's not just a catchy phrase. Look at the chart and you'll see Freeport peaked around $53 back in March 2022. The stock reversed and sold off. Then it climbed back to this same level in May 2024, reversed again, and headed lower. Twice now, $53 has been the ceiling.

Here's why that happens. When people buy shares near a peak and watch them drop, many feel regret. They hold onto their losing positions, but they make a promise to themselves: if the stock ever gets back to where I bought it, I'm out. No more pain, just break even and move on.

So when the stock rallies back to that original buy price, they place their sell orders. If enough people do this at the same price level, you get resistance right where the previous peak was.

Markets Remember Everything

The second saying is "markets have memories." Important price levels can stay important for surprisingly long stretches. We're talking months, quarters, sometimes years. With Freeport, more than two years passed between those first two tops. Now the stock is back at $53 for a third time, and once again it's struggling.

When stocks hit resistance, they often reverse. Anxious sellers start undercutting each other because they know buyers will chase the lowest price. Other sellers see this happening and panic, creating a snowball effect that pushes prices lower.

That's exactly what happened the last two times Freeport reached current levels. The pattern is hard to ignore, and it might be setting up to happen again.