Trade of the Day: Newmont Mining Corp (NEM)

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Our indicators are back to giving neutral readings after several weeks of bearish signals, so I will be leaning toward the bullish camp for the next few days.

The federal government is going to have to pump a lot of money into the Texas economy during the rebuilding process after Hurricane Harvey. This should have a positive effect on many companies that are not in the state, acting in a sense like a small quantitative easing program.

There are a few other bullish factors supporting stocks as well. This week, the market got a much better-than-expected reading on gross domestic product (GDP), which was revised higher to 3% against estimates for a reading of 2.7%. Furthermore, earnings have been looking good recently, and the “Trump put” is still in place considering that tax-reform seems to be back on the table for 2017. And this time of the month is usually bullish for stocks, as fund managers will likely be putting their new money to work over the next few trading sessions.

Copper, which I am still bullish on, has been on a fantastic run this year, and I’m bullish on precious metals mining as well. All of this being the case, this looks like a good time to buy Newmont Mining Corp (NYSE:NEM) calls.

Buy to open the NEM Oct 40 Calls (NEM171020C00040000) at $0.80 or lower.

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