Friday 9/18/20: VALE, LAC, PENN
Hi everyone,
I hope you’re managing the current tech-downtrend well. These are my trade ideas for Friday:
VALE: Vale S.A. is a Brazilian multinational corporation engaged in metals and mining and one of the largest logistics operators in Brazil. Vale, formerly Companhia Vale do Rio Doce, is the largest producer of iron ore and nickel in the world [Wikipedia].
I am expecting VALE to move up ahead of the Tesla battery day on 9/22 since Tesla is desperate for Nickel and could announce a potential partnership or long-term contract with Vale. I am looking at short-term OTM call options.
Elon Musk quote from last earnings call: “any mining companies out there, please mine more nickel. Okay. Wherever you are in the world, please mine more nickel…Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way. So hopefully this message goes out to all mining companies. Please get nickel” [Reuters].LAC: Lithium Americas Corp is advancing the Thacker Pass lithium project close to Tesla’s Gigafactory near Reno. Similarly to VALE, I am also expecting a further run-up prior to battery day based on Tesla’s increasing Lithium demand. This is a comparatively higher risk / higher reward play since it’s a low market cap stock below $1B that already rallied.
PENN: 'Portnoy momentum' can drive Penn National 25% higher, Stifel says [BI]. I am suspecting a further run-up and I am looking at super-short term daily calls at market open / or at a slight temporary pullback [looking at 1-min candles]. This is a high-risk momentum trade that should be closed within hours.
Enjoy your weekend!
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This is not financial advise. All opinions expressed in this newsletter are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.