Can the Rio Tinto share price set a new record by the end of the year?

Rising metal prices helped the mining giant to record half-year earnings. Could this put the Rio Tinto share price on course for a new ATH in 2021?

Yesterday, Rio Tinto plc (LON: RIO) posted its best-ever 6-month performance, revealing a $12.17 billion profit for the period.

Rising iron ore prices and increasing demand from China, the world’s biggest consumer of raw materials, saw the mining giants profits swell more than 157% from the same period last year.

Furthermore, Rio announced it would pay out a monster $9.1 billion in dividends to shareholders.

“Government stimulus in response to ongoing COVID-19 pressures has driven strong demand for our products at a time of constrained supply resulting in a significant spike in most prices. We focused on safely running our world-class assets and supplying products to our customers. This enabled us, despite operational challenges, to deliver record financial results with free cash flow of $10.2 billion and underlying earnings of $12.2 billion, after taxes and government royalties of $7.3 billion. We are further strengthening the portfolio with our commitment to fund the high-quality Jadar lithium project, which signals our large-scale entry into the fast-growing battery materials market. We will pay an interim dividend of 561 US cents per share, representing 75% of underlying earnings.

Rio Tinto CEO, Jakob Stausholm

With rising commodity prices showing no signs of slowing, and the Federal reserve last night calming tapering fears, could the Rio Tinto share price soon set a new price record?

RIO price prediction

The daily chart shows that in the last 9 days, RIO has gained 7.5% after bouncing from robust trend support at 5,700p.

As a result, the price has cleared the resistance of a descending trend line from the May 6,788p high. If the price stays above this trend at 6,106p in today’s trading session, it will confirm the breakout.

On that basis, this resistance level becomes the first line of support.

Additionally, RIO is above the 50, 100 and 200-day moving averages, and the Relative Strength Indicator (RSI) is trending higher.

In my opinion, considering the strong fundamental and technical factors, the RIO Tinto share price could easily surpass May’s high by the end of this year. However, this bullish view becomes invalid should RIO drop below the trend at 5,700p.

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Rio Tinto share price chart

Rio Tinto Share price

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