FPMB trade ideas
fcx plan. divergence from long time partner..Copper and fcx have had a long, relatively tight relationship. how long will division last?
trade deal? I feel like at some point in near future the words trade deal signed will appear in headlines.
$FCX FREEPORT MCMORAN LOOKS VERY POSITIVEFreeport has mirrored the price of copper and on the 4th of January when copper prices pivoted to the upside FCX began its reversal. this stock has loads of room to run to the upside. The only problem we can see is a breakdown in the Trade talks with China.
Long FCXBottom @$10.00
Strong Earnings and low P/E
Undervalued by current market
Strong Swing potential.
FCX potential longAfter a long turn down, it seems the trend will turn upward. If the stock can break through the level around 12,5 $ the next serious obstacle can be around 15 $. Th technical view is promising.
FCX appraoching resitance, potential drop! FCX is approaching our first resistance at 13.62 (horizontal pullback resistance, 61.8% fibonacci extension, 38.2% Fibonacci retracement) where a strong drop might occur below this level to our major support at 11.53 (horizontal swing low support, 50% fibonacci retracement).
Stochastic (55,5,3) is also approaching resistance where we might see a corresponding drop in price.
OPENING: FCX APRIL 18TH 13 SHORT STRADDLE... for a 1.90/contract credit.
Metrics:
Max Profit: $190/contract
Max Loss/Buying Power Effect: Undefined/~$260 (on margin); full notional (cash secured)
Break Evens: 11.10/14.90
Delta: 31.37
Theta: 1.05
Notes: Implied volatility's still pretty high post-earnings at 42%, so taking a modestly bullish assumption shot with a position that emulates the delta metrics of a 30 delta short put while bringing in more credit, albeit with some upside risk above 14.90. In comparison, the 30 delta shortie in April (the 11 strike) is bringing in .47 with a down side break even of 10.53. I'll look to take profit at 25% max (.48) which would be about an 18.3% return.
FCX Giant Falling WedgeFCX has taken a beating since it peaked around $20 a year ago. But I seem some signs that the down trend might soon come to end. The stock is in a falling wedge pattern, and a breakout to the upside would be very bullish for the stock.
Here is how I would play this one:
Wait for the break of the resistance at around 12.68 (red line). It has attempted to break 3 times and been rejected. If the stock breaks out of the wedge, AND through clears the 12.68 resistance,, that would be a clear BUY signal to me.
FCX, COPX, Copper, XCUUSDIn the weeks to come, it looks like FCX is setting up for a major bottom akin to the preciohs metals miners imo.
The monthly stochastics is still down, so one for the watchlist. Price action looking good so far…
THE WEEK AHEAD: DAL, OIH/XOP, XLK, FCXAfter a short break for shortened trading weeks for the Christmas and New Year's holidays (how bout them holiday markets, huh?), I'm back to my regular routine. Here's what's on tap for the coming week ... .
Earnings:
I'm not seeing much on the earnings front for volatility contraction plays or premium plays in high implied volatility around earnings that are giving me that "come hither" look. I did look at DAL (65/40; earnings on Thursday), but it's got goofy two-and-a-halfs on the call side in the Feb expiry where I'd want to set up my tent, which could make call side trade management problematic. The very last type of headache I want to have with a trade is being forced to roll to a goofy strike or do something whacky because of strike unavailability. That being said, the February 15th 45 short put is paying 1.26 (30 delta) with a break even of 43.74 (8.5% discount over current price; divvy yield is 2.80%; 1.40 annualized) should that type of play strike your fancy.
Exchange-Traded Funds Ordered by Implied Volatility Rank:
GDX 73/33
USO 69/53
OIH 64/46
IYR 62/21
GDXJ 59/34
... And Ordered by 30-Day Implied:
UNG 38/54
USO 59/53
OIH 64/46
XOP 53/43
EWZ 27/35
As usual, petro (USO, OIH, XOP) is sticking out for volatility, which is kind of why I like to be in some kind of play with a premium selling component on a virtually constant basis. OIH and XOP continue to dribble along at the low end of their ranges, so my preference would be for bullish assumption setups there with no or limited upside risk (short puts, upward call diagonals, lizards) in the short to medium term. Having gotten out of an XOP upward call diagonal last week, I'll probably re-up with something in the February cycle and will post that trade here separately later in the week.
Broad Market:
QQQ: 59/30
IWM: 52/26
XLK: 48/30
SPY: 25/24
I've thrown XLK (technology) in here because of its close correlation with SPY (3-month of .86). In comparison, it's got slightly better volatility metrics, but is also one-fourth the price, so you can potentially proxy a broad market play without hanging as much buying power out there as you would with one of the majors.
Trade of the Week:
Pictured here is an FCX (62/57) upward call diagonal (bullish assumption) setup (with an overlay of copper futures). Although it's got earnings in 18, I'm just looking to get in on weakness and in a fairly high volatility environment. Moreover, I can get in fairly cheaply with a greater than 180 day back month, which will give me plenty of time to reduce cost basis in the diagonal. I went with the March 12 short call strike for the front month because the Feb 11 was "too close," and the Feb 12 was "too far away" (not enough collected for the short call). Metrics: Max Loss on Setup: $278; Max Profit on Setup: $122; Break Even: 10.78 versus 10.82 spot; Debit Paid to Spread Width Ratio: 69.5%.
FCX 6.5 MONTH CHANNEL BROKENFCX CHANNEL BROKEN WITH A NICE CANDLE.
TAKE PROFIT: 14.5
STOP LOSS: 11.5
The FUTURE High / Low price swing dates for FCXThese are the FUTURE dates for FCX with
the highest probability for experiencing a price
swing high or low. Apply your own indicator(s)
to determine the price swing direction.
FCX Looking to get VERY LONG at the right priceTitle says it all but this is not the right price - yet . Stay tuned. #trading #stocks #fintech #Copper #Crypto
FCX - EXPECTING...Starting from the left. Good increasing volume with a follow-up. Decreasing volume with a consolation pattern followed up a symmetrical triangle, broke out well with a volume, but afterwards volume started to decline and achieved higher highs and crashed.... Double top, stop run etc... Price increase without a volume (double top? stop run? macd shouts)), bad... crashed again, bought up and volume started immediately to decrease. Might test the 18 lvl and crash to the new lows. My opinion.
FCX - EXPECTING A LONG TERM DOWNTRENDFCX has broken the daily correction. I'm expecting a downtrend continuation. Look to the price action for a potential pullback.
TONCHINOMICS: FREEPORT-MCMORAN MAJOR TREND DOWN for now butFREEPORT-MCMORAN MAJOR TREND DOWN for now but approaching 7 year and 7 month long term downtrend line.
A breakout of this longterm downtrend line could create a MAJOR TREND UP.
