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Today we are looking at applying a Bull Call on BHP Group Ltd (BHP)

Analysis:

BHP is currently trading at $46.71.

BHP has been trading in a long-term uptrend since its crash last year March. Recently it has pulled back with the rest of the mining space. It pulled back to the uptrend line and today has it bouncing from it, as well as the key support around $45.50. The market as a whole looks strong and so does Iron Ore.

We could expect BHP to continue higher, but considering the recent volatility across markets it makes sense to hedge for it. We can look at a Bull Call spread where profit is made with a move back towards the counter trend line, but also if BHP track sidewards as it whips around. Ultimately we are expecting the trend and support to hold, so we can place our stop there.

If you would like to learn how and when to use this strategy, and other strategies like it, then please contact us here at TradersCircle on 03 8080 5788. Alternately, you can access a number of free resources off our website which runs through advanced strategies.