Options Bulls Should Consider This Gold Stock

NEM has added more than 19% over the past six months

Jun 14, 2022 at 10:12 AM
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Gold stock Newmont Corporation (NYSE:NEM) is bouncing off support at its 200- and 320-day moving average convergence. The stock has also found a floor right above the $62-$63 area, which marks both its year-to-date breakeven level and round $50 billion market cap. Plus, the stock is up 7.8% year-to-date and 19.2% over the past six months.

NEM Chart June 14

Of the 23 analysts in coverage, 16 carry a "hold" rating, with seven at a "buy" or better, leaving plenty of opportunity for an optimistic shift. And though short interest has increased roughly 40% since December, the shares have still rallied, pointing to underlying technical strength.
 
Many June 70 and 75 calls expire next week, and some recent weakness may have been caused by an unwinding of long positions associated with these calls. Furthermore, the security's Schaeffer's Volatility Scorecard (SVS) sits at a relatively high 80 out of 100, meaning NEM has exceeded options traders' volatility expectations during the past year.
 
Subscribers to Schaeffer's Weekend Trader options recommendation service received this NEM 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.
 

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