New Money Link Trade Alert:

Hey guys,

I have a new core portfolio trade for you this morning!

But first, let's exit our current core portfolio trade:

SELL TO CLOSE RKT AT $20 OR HIGHER.

BUY TO COVER WFC AT $29 OR LOWER.

Note: Keep both options on, as most value has eroded and there's still time before the contracts expire for an extended move in our favor.

And now, for our new core porftolio trade, let's:

BUY TO OPEN NEM AT $59 OR LOWER.

SELL SHORT VALE AT $14.

And for an options play:

BUY NEM 3/19/21 $55 CALLS AT $6.20 OR LOWER.

BUY VALE 3/19/21 $ 14 PUTS AT $2 OR LOWER.

Vale SA (NYSE: VALE) is a Brazilian iron ore mining stock that has been the poster child of the reopen bid. I’ve been waiting patiently for my chance to pounce on the short side of the stock. But as my experience with Monthly Money Flows dictates, I knew the stock would be jammed up into month’s end. And today is that day. I’ve been eyeing a re-entry into gold mining, which has seen money flow out into more economic growth mining stocks like Vale.

The Money Link spread between Newmont Corp. (NYSE: NEM) and Vale has collapsed almost 50% in a month, a nearly 2 standard deviation move!

House-Keeping Note: I’ve reinstituted stop-loss levels after the election drama and vaccine news have been largely discounted. Use the stock stop-loss levels to trigger exits in the options. I’m hesitant to give stops on the options, as those markets will trigger stops with no rhyme or reason based on liquidity.

It’s important to execute both sides of the link at the same time and to respect the limit levels mentioned above — never chase a trade.

LFG!

Jeff Zananiri

Joy of the Trade