6 Trades to Double Your Money by the End of Summer
OptionsZone Experts, July 4, 2009
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Cliffs Natural Resources (CLF)
By John Lansing
Iron and coal mining company Cliffs Natural Resources (CLF) is ready for a breakout. It is in a very similar pattern to Nucor Corp. (NUE), but, again, it's not a classic ascending triangle because CLF's historical pricing involved more of a consolidation after previously hitting resistance around the $31 level. After CLF makes it past that, I'm looking for the stock to take a small pause between $32 and $33, and then zoom up close to the $40 level.
The best way to play this potential move is with the CLF August and September $30 strike calls.
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Looking into June, the market should begin refocusing on upcoming earnings reports for evidence the economy is gaining momentum.
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In the short-term, the government's bond auction is likely to be a key driver of stocks.
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The market seems to be saying that a 30% move up from the lows is ahead of the real economy and the market needs to allow the economy to catch up.
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