Hey Trader,

Uranium stocks had a moment in the sun in the fall of 2021, but now the once-explosive sector seems to be fizzling out …

Is the “uranium mania” over for good, or is the radioactive element just taking a breather?

Well, according to one Big Money trade, they think uranium is coming back in a big way …

And they used some very interesting trading strategies to position themselves to take advantage of the boom …

Here’s the Big Money trade betting that this uranium stock is about to blow up (again).

Cameco Corp. (Ticker: CCJ)

Surging uranium prices and a demand for alternative energy stocks resulted in a blockbuster autumn for uranium stocks, and especially CCJ. 

Spot uranium prices eclipsed the $50/lb mark for the first time since 2012, and huge purchases of physical uranium by the Sprott Physical Uranium Trust (Ticker: SRUUF) helped bolster prices even further.

CCJ shares surged from a low of $15.29 in late August all the way up to $26.48 by mid-September – that’s a 73% gain in less than 20 trading days!

Chart courtesy StockCharts

But since notching a high of $28.40 in early November, CCJ has struggled to maintain its gains.

Early in 2022, uranium prices were boosted by concerns of unrest in Kazakhstan, which accounts for 40% of global uranium production, and demand for alternative energy sources around the globe.

However, CCJ has since given back even its early-year gains, and now sits near its pre- “uranium mania” price levels.

Is this the beginning of the end for the uranium favorite, or is it just a temporary breather?

By the looks of one Big Money trader’s move during Tuesday’s trading session …

They’re ready for uranium to blow sky-high again!

Check this out …

Interesting trade, right?

First, this trader opened up a (somewhat strange) butterfly in CCJ, buying 18,000 of the March 23-strike calls for $0.83 ($1,494,000 total), along with 15,000 of the March 35-strike calls for $0.06 ($90,000 total). They then sold 36,000 contracts of the 28-strike calls for $0.23, which brings in $828,000 in premium. 

Ideally, if CCJ sits at $28 (the strike of the short calls) by the time this trade expires, this trade will achieve maximum profits.

But that’s only part of what’s going on here …

This trader also sold 1,000 20-strike puts for $2.38. This gives the trade a bullish tilt, and brings in $238,000 in premium to help pay the cost of the butterfly. Together with the sale of the 28-strike calls, this trader was able to bring in $1,066,000, while paying $1,584,000 to buy the 23-strike and 35-strike calls.

All and all, this trader only paid $518,000 out of pocket to place this gargantuan trade.

But still, they weren’t finished …

Note the block of $258,000 shares that crossed the tape at the same time.

These shares were likely sold to help neutralize the rather hefty delta of this trade.

By bringing the delta closer to zero, this trader is able to protect themselves from near-term directional movement, while maintaining their slightly longer-term bullish stance

All in all, this is a rather interesting Smart Money trade that utilizes several more advanced trading strategies, and leaves this trader well-positioned for uranium stock CCJ to go “boom!” in the weeks ahead.

Your Only Option,

Mark Sebastian