Add ABX Calls

Get Positioned Into August

By Bryan Bottarelli
Wednesday, July 01, 2009 10:10 AM EDT
Wed, 1 Jul 2009 14:10:00 GMT

PLAY: Buy the ABX August 35 Calls (ABX HG) at or under $2.20, good for the day. Place a protective stop limit at $1.05 and a pre-determined sniper sell at $3.50.

Dear Bottarelli Research Member,

Good morning. Thus far, the major market averages are attempting to shrug off yesterday’s downside move, which simply means that the markets are jumping around a lot without really going anywhere. But the one sector that is making a nice push this morning is the metals, which leads me to believe that gold and silver prices have established a floor. As a result, I’d like to get positioned in Barrick Gold Corporation (ABX – NYSE) going into August. As you can see from the ABX chart, the stock is bouncing right at the 50-day moving average, which should set the table for a coming upside push. Let’s play this move now!

ABX

PLAY: Buy the ABX August 35 Calls (ABX HG) at or under $2.20, good for the day. Place a protective stop limit at $1.05 and a pre-determined sniper sell at $3.50.

At the same time, hold your TLT August 95 Puts (ILT TQ) and your SDS August 57 Calls (SDS HE). Taken together, these three positions give us a diversified trading position in Treasuries, metals, and the SPX. Looking at today’s TLT chart, the gap-down could be a sign of things to come. If so, we’ll be in great shape.

TLT

As always, I’ll keep you fully updated throughout the trading day. Until then…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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