Can anything stop Freeport-McMoRan Copper & Gold?
The metals and energy producer has been running hard since it was
cited on the
June 20 installment
of our Market Action webinar. There was also bullish option
and those trades are already up more than 40 percent.
Today's trading is bullish again, with optionMONSTER's Heat Seeker
showing especially heavy call volume. The biggest transaction
consisted of a roll from the July 36 calls, which were sold for
$2.24 to $2.49, into the July 39 calls, purchased for $0.32 to
$0.38. About 6,800 contracts traded in each strike.
lock in the price where investors can get long a stock, providing
cheap leverage to a rally. Today's investor probably bought the 36s
when FCX was lower and is now sitting on a nice profit. Adjusting
to the higher strike let him or her recover about $1.96 while
staying positioned to profit from further stock gains. The
September 40 calls were also bought for $0.83 to $0.95. (See our
FCX is up 1.93 percent to $38.56 in afternoon trading and has been
the best-performing materials stock in the S&P 500 since it was
mentioned on Market Action. It's been waking up along with other
metals producers such as U.S. Steel and AK Steel.
Investors have returned to the sector after neglecting it for
years. They're responding to strong economic numbers in the U.S.
and China, and appear to be rotating out of high-flying energy
stocks. Coal miners have also been coming back to life, according
Total option volume in FCX is almost triple its full-session
average in this holiday-shortened session, with calls outnumbering
puts by a bullish 50-to-1 ratio.
I own FCX shares.
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