Subscribers to Schaeffer's Weekend Trader options recommendation service received this AEM commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.
Gold miner Agnico Eagle Mines Ltd (NYSE:AEM) has cleared $160, a potential call wall after a pullback to $156. The shares are above a potential trendline of resistance connecting October and April highs with a short-term peak earlier this month. The shares’ 20-day moving average – supportive since an early-August breakout -- is sloping higher and currently sits at $155.
Despite a 109% year-to-date gain, short interest has increased by 70% this year, including a 26% bump since August as bears faded the breakout above resistance at $126.50.
Even amid all-time highs, the gold miner could benefit from a lower dollar as the Fed lower rates to address employment part of its dual mandate, while at the same time, tariff-related inflation remaining higher would also be a boon for the safe-haven asset.
Our recommended December call has a leverage ratio of 6.9 and will double in value on a 15.1% pop in the underlying equity.
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