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As the market rallies, bonds have actually been relatively defensive. While traders need to be careful about bullish positions, yields are not putting as much negative pressure on dividends. We think this is a very good environment for IP to continue its bounce off support.
The stock got an upgrade as paperboard prices are rising with increased consumer demand. Strong shippers and online sales should continue to support the stock while the dividend makes it more attractive for value investors. In the short-term, we expect IP to re-approach its prior highs near $58 per share as investors accumulate "defensive stocks."
'Buy to open' the IP September 55 Calls (IP170915C00055000) for a maximum price of $0.72.
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InvestorPlace advisers John Jagerson and S. Wade Hansen, both Chartered Market Technician (CMT) designees, are co-founders of LearningMarkets.com, as well as the co-editors of SlingShot Trader, a trading service designed to help you make options profits by trading the news. Get in on the next SlingShot Trader trade and get 1 free month today by clicking here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.