Freeport-McMoRan Inc. (FCX:NYSE) is the world's largest producer of molybdenum, is a major copper producer, and operates the world's largest gold mine, the Grasberg mine in Papua, Indonesia.
If you are a copper and gold bull (as I am), you have to like the idea of "one-stop-shopping" and own the shares of FCX:NYSE. It is seen more as a copper deal than a gold deal, but when both metals begin to outperform later this year, I can see it as an institutional favorite with a performance that could parallel the awesome move in Cameco Corp. (CCO:TSX; CCJ:NYSE) since late 2020 when one could have accumulated it under US$10.
Technically, FCX:NYSE is very close to a bullish MACD crossover, which joins the bullish Money Flow Indicator ("MFI"). A 2-day close above the downtrend line at US$41 will set up a move to test the highs at US$43, but once beyond that, the sky is virtually the limit.
I am looking to make FCX:NSYE a "core" trading position in the same way that I have been using SPDR Gold Shares ETF (GLD:NYSE) in the past. For this reason, I am taking a minor 20% position in the FCX June US$40 calls at a price of US$4.00 as a starter, adding another 20% every two days after today.
Since the FOMC meeting could send stocks either up or down once it knows Powell's intentions, it is cointoss as to whether one should bid now or after the presser. I am going to move now to join the bid at US$4.00.
- Buy 20% position FCX June US$40 calls at US$4.00.
Add 20% every two days after today until you reach a 100% position. I will start with ten contracts.
For non-option traders, I prefer FCX:NYSE to either of the gold miner ETF's (GDX/GDXJ) and to the two copper ETF's (COPX/COPJ).
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- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Cameco Corp.
- Michael Ballanger: I, or members of my immediate household or family, own securities of: All. I determined which companies would be included in this article based on my research and understanding of the sector.
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Michael Ballanger Disclosures
This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.