A Powerful Metals Play

Add ACH Calls

By Bryan Bottarelli
Monday, October 01, 2007 11:37 AM EDT
Mon, 1 Oct 2007 15:37:00 GMT

Dear Bottarelli Research Member,

There’s a lot of bullishness in the precious metals sector, and this warrants a close look at powerhouse metals plays like Southern Copper (PCU – NYSE) and Freeport-McMoRan Copper & Gold (FCX – NYSE).But while each stock looks strong, I think we have an even more powerful upside opportunity in shares of Aluminum Corp. Of China (ACH – NYSE).

ACH

ACH engages in the production and sale of aluminum in the People’s Republic of China – and the recent chart indicates that an upside breakout could be looming on the horizon. Furthermore, news of the Dow hitting 14,000 will most likely have a positive impact on overseas markets, and this could lead to further upside movement in ACH. So let’s establish an upside position now.

PLAY: Buy the ACH November 75 Calls (ACH KO) at or under $5.90, good for the day. Place a protective stop limit at $3.20.

Also continue to hold your SHLD October 125 Puts (KTQ VE), as the stock is trading lower despite today’s 100-point rally. This should bode well looking ahead this week.

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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