Trade Summary: February 21, 2017

| February 21, 2017

February 21, 2017

 

Trade Rationale

The markets continue trending higher… and the Trump rally continues.  We’re holding well over 20,000 on the Dow Jones Industrial Average… and commodities are strong too.

Now this is an interesting set up in the market.

The US Dollar is showing strength, climbing almost 6% in the last few months.  This would normally make global commodities more pricy (because most commodities are priced in US Dollars)… as a result, you’d expect commodity prices overall to fall, but that’s not happening.

Gold & Oil prices are higher!  

It means demand is outstripping supply for these products. I’m expecting commodity prices to continue climbing… and climbing… and climbing.

Who benefits?  The commodity producers of course.  Over the next few months, I see these stocks climb because higher prices mean bigger profits!

So let’s get long a handful of Commodity plays…

 

Trade Details

#1) Buy ArcelorMittal (MT) Jun 16th $10 Calls up to $0.55

We want MT to move higher… Profit exit points are $11 and $12.  Exit at $7.75 or $7 to conserve capital.

ArcelorMittal

#2) Buy Newmont Mining Corporation (NEM) Apr 21st $40 Calls up to $1.20

Take profits if NEM trades above $40, or for aggressive traders, $41.  For risk control, the conservative exit level is $35.  Lastly, $34 is the final exit level for aggressive traders.

Newmont Mining

#3) Buy Monsanto Company (MON) Apr 21st $115 Calls up to $2.10

A third call option this week… we want MON to move higher.  Profit levels are $115 and $117, conserve capital at $105 or $100.

Monsanto Company

 

Category: AOA Trade Summary

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