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Archive for September, 2009

Research In Motion Misses Estimates

Friday, September 25th, 2009

9:10am (EST)

Futures are pointing towards a lower open this morning and the bulls look tired as we wrap up the last trading day of the week.  The Durable Goods Orders Report, which just came out at 8:30am, was awful as August orders decreased 2.4%.  That was far below the 0.4% increase that was widely expected by economists and down sharply from the 4.8% increase that was got in July.

Dow futures are down 26, S&P 500 futures are lower by 4 while Nasdaq 100 futures are off by 8 points.

Other economic reports due out this morning include the University of Michigan Sentiment Index for Sept and New Home Sales for August.  Wall Street expects a number of 70.5 for the first report and 441,000 for the other.

Shares of smartphone maker Research In Motion (RIMM, $83.06) are down 14% after reporting disappointing quarterly results.  The company reported earnings of $1.03, ex-items, which was 3 cents better than what analysts had expected.  Revenue for the quarter came in at $3.5 billion, up nearly 40% from the previous quarter but the Street was expecting $3.6 billion.

RIMM added 3.8 million new BlackBerry subscriber accounts and at the end of the quarter, the total account base stands at approximately 32 million users.  Another reason the stock is breaking down like a rented mule is because Research In Motion offered lowered guidance that also missed expectations.  The company said sales for the next quarter would be $3.6-$3.85 billion, versus the consensus of $3.90 billion, and earning should come in between $1.00-$1.08, versus Wall Street’s estimate of $1.04.

In any event, it should be another interesting day.  Subscribers, check the Members Area for the trade updates.

Rick@MomentumOptionsTrading.com

Homes Sales Data Pulls Market Lower

Thursday, September 24th, 2009

1:10pm (EST)

The market got off to a good start after the Labor Department reported the number of newly laid off workers seeking unemployment benefits fell for a third week in a row. Initial claims for unemployment insurance fell by 21,000 last week to 530,000, which was better than the 550,000 Wall Street had expected.

The upward momentum was lost once the housing numbers came out at 10am.  The National Association of Realtors spoiled the party when they reported existing home sales declined 2.7% in August compared to a 7.2% pop in July.  That took the wind out of the bull’s sails as they had been expecting a fifth straight increase.

I had mentioned that yesterday’s afternoon sell-off wasn’t a good sign and we will have to watch for that today.  With earnings season right around the corner, it seems we could have a battle for position as both the bulls and bears try and get an early jump.

The negative bias today has taken us out a few of our trades.  But not before we booked our profits.  There is one trade I like right now and I have been waiting for the breakdown in the stock before recommending a put option trade.  Subscribers, check the Members Area for the update.

Rick@MomentumOptionsTrading.com

Dendreon Briefs Wall Street

Thursday, September 24th, 2009

8:40am (EST)

Futures are slightly higher this morning as the market tries to rebound from yesterday’s nasty close.  Ahead of the bell, Dow futures are up 14, to 9,731.  S&P 500 futures are higher by 2, to 1,061, while the Nasdaq 100 futures have climbed 7, to 1,732.

We have a big day so I wanted to get this update out a little early.  The first thing I wanted to talk about is the Dendreon (DNDN, $28.27, down $0.60) news conference this morning.  This event will result in one of three things.  Either the stock goes up on great news, build-out plans and sales figures or it tanks because Wall Street gets nervous on something they say.  Or, the news isn’t overwhelming or negative and the stock holds current levels.

Dendreon is broadcasting the conference call and I wanted to provide everyone a chance to listen in this morning.  Simply go to their website and listen to the Webcast which starts at 8:45am (EST).

Research In Motion (RIMM, $85.77, up $0.91) will report earnings today after the bell so the next two trading days will likely result in a big move up or down.  Subscribers, check the Members Area for the trade updates.

Rick@MomentumOptionsTrading.com

MomentumOptionsTrading NewsFlash for 9/23/09: Fed Holds Rates

Wednesday, September 23rd, 2009

2:40pm (EST)

The Fed left rates unchanged and they expect them to stay low for quite some time.  The vote was unanimous and the market has rallied off of the news.  The Dow is currently up 50 points to 9,880 while the S&P 500 is up 4 to 1,076.  The Nasdaq is up 10 points to 2,156.

The way things are looking, I wouldn’t be surprised to see Dow 10,000 this week.   Subscribers, check the Members Area for the trade updates for Research In Motion (RIMM, $87.47, up $2.61) and ChangeYou (CYOU, $40.80, up $2.87) NOW.

Rick@MomentumOptionsTrading.com

Research In Motion Rolling

Wednesday, September 23rd, 2009

12:20pm (EST)

Research In Motion (RIMM, $87.24, up $2.38) is rocking-and-rolling ahead of Thursday’s big earnings announcement.  Wall Street is expecting a good report card from the company as the average estimate calls for RIMM to earn $1 a share for the quarter.  In the year ago quarter, the company earned 86 cents a share.  Revenue is seen coming in at $3.6-$3.7 billion versus $2.6 billion.

From everything I have been researched, it looks like the company will come in at $1.05 a share on revenue as high as $3.9 billion.  The increase in earnings show just how much momentum the smartphone market has.

Note:  Earnings come out after the market close on Thursday.

Subscribers are currently up 40% on the RIMM option trade that was profiled in the Members Area last Friday and Monday.  We are approaching the first exit target for the trade and we are about 10 cents away from hitting it.  I said if the stock hits $86-$87 then our target should be hit.  Bingo.

Since earnings come out after the bell on Thursday we can continue to hold the options for another day at least.  However, our goal is to close half the trade once we hit our target and then see how we are looking on the other half in the 1pm update on Thursday.

The other side of that coin is this.  We have a number of new subscribers that joined us over the weekend and this week.  Depending on your entry price for the trade, many of you are up 40%-50% in three days. 

Now think about that for a minute.  Especially, if you are a new option trader.  Where else are you going to find a 50% return in 3 days?  You can cash in now and look for another trade.  This is how you build your option portfolio or your trading business.

Once you have a steady run of profits, then you can do different things with your trades.  This is when you are able to close half the trade after a 50% gain and then let the rest ride.  I still don’t know how the stock will react the rest of the day, Thursday, or on Friday…no one does, but I want to prepare you for all of the possible outcomes.

There is also the chance the stock heads even higher and we exit the entire trade for a 100% return before earnings.  There is also the risk of the stock retreating from current levels and investors could ”sell the news” before or after the company announces earnings.

Either way, the stock could move 10% once the news is out which gives us a $9 swing.  If you are on the wrong side of the trade once earnings are released it will hit you harder than a Vegas headache.  So protect yourself and make sure you look at all the angles over the next 24 hours. 

Current Subscribers, I will update all of the trades tonight and have the playbook ready in the morning in the Members Area. 

Rick@MomentumOptionsTrading.com

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Trader Comments:

    REGINA L.
    I just want you to know that I love the way you write and explain everything. I am new to this, and have lost 50% of my account until I met you guys. Iit is slowly coming back. I will be calling to set up a year
    of membership rather than the one quarter. Thanks again, and LOVE YOU ALL.

    STEVE T.
    Rick, I appreciate the advice. I think I will just sit back and utilize your selections only for awhile. This will obviously save me a great deal of money in commissions. I have gone thru your entire site including the video on money management. This has brought me to the stark realization that I have been trading too much for too little. I definitely have not been "swinging for the fences", but I also think I have been getting impatient with trades and getting out too fast. This has no doubt caused me too trade too much. I like, and definitely agree on, the advice on money management. Thanks for the help.

    SCOTT H.
    Thank you!!! I held on to the NFLX position since Nov. 13 at a cost of $1.89. Sold ½ on April 14th for a 540% return and the other ½ upon earnings for 702% return. Total profit of $11,615 a 621% return. Keep the recommendations coming and thanks to you and your team for the service you provide.

    PETER G.
    Rick & Team, GREAT Call on NKE for my two trading accounts:
    1) Entry at .65, out at 1.45, 1.55 Profit = $415
    2) Entry at .60, out at 1.75, 1.50 Profit = $485

    LAWRENCE O.
    Hey Rick! Here is an update on what your picks have done in my accounts.

    1) Great call on the JoyG March 55. I bought when you said, then bought again on one of the dips. Booked 80+% profit. Made enough to pay for your service for years to come.

    2) Also booked profits on your Berk Feb 74 (80%) and threw a major chunk of change at the March 75’s (190+%). I would have never known that Buffet's stock had split if it weren’t for your service. Bought the shares also for the long haul. Won’t look at them for another 20 years. Great job on getting us in before the indexes did.

    3) Took profit on your Imax March 12.5. 20 cent trailing stop at 1.90 yesterday. Not sure what the profit on that was, but profit is profit.

    I see that you took a loss on some of these. It’s all good. I look to trade your “ideas” not your exact calls. I THANK YOU! For your ideas and commentary. Keep up the good work. And keep those ideas coming.

    C.J.
    Loving this subscription so far! I got into the BRK feb 76 calls the day you talked about right before the split...now up over 300% (0.70 to 2.475)! Keep the good picks coming and let's see some OSIS and EMC upside soon! Just wanted to share my positive enthusiasm on your newsletter...it gives us individual investors great ideas on not only the options market, but also the broader equity market! Case in point is BRK...I can't always read the breaking business news but its easy to read your twice daily updates on my smartphone...helped me get some BRK shares immediately after the split which I will hold for the long haul! Thanks again!

    SHAUN
    Aloha Rick - Thank you so much for the great CL pick. I am not sure if there was buy-out/merger news or what but at 3PM today Colgate-Palmolive absolutely EXPLODED to the upside, and my calls turned into green candy when they went from 1.40 to 3.8 in a matter of seconds! I even sold a few for over 4.0! Much thanks and keep the solid picks up my friend, honestly. Only a fool would scoff at 267% gains... Peace!

    MICHAEL K.
    I like the fact that you ask for comments from subscribers. Good customer service. By the way, am enjoying the service so far. Some good
    profitable calls. Keep up the good work.

    PARAG P.
    Woo hoo! Out for 50% on WMT this am. Making up for my depression for getting out of pcln for a 30% gain monday :( you the man! any word on the manual? My friend Mike ( who I sent to your service) told me he emailed you about your integrity in reporting fills. I echo that sentiment big time.. keep it up! Cheers!

    JAY P.
    Hi Rick, as a new member all I can say is, 'show off' LOL, with PCLN.

    MIKE
    Rick, I am a new subscriber to your service, and I want to say I am impressed. I am impressed by your results, but more than that I am impressed by your reporting of your fills. You could have easily said you got that Wal-Mart call today for 80 cents, instead you reported 98 cents! Good job and keep it up, I watched the reporting of the fills first, and then I subscribed. Thank You.

    TRISH D.
    Hi, good morning. I jumped the gun a little on this one (PCLN). But still made $1,675.00 profit!! Very happy!! Keep up the good work!! Thanks.

    MIN L.
    Hi there, I have joined recently, and I am very happy to tell you that I am up over $10,000 on your picks in a month. I started on 10/7 with the Intel pick. I'll be your member for life. Please don't quit on us. Also, I am learning a lot about options. I didn’t get in your recent APOL and that gold trade and only had one loss on CHK. I appreciate all the DD you do. I enjoy your market commentaries. Best advice site period, and I have tried a few here and there. Again, you guys rock!

    JOE G.
    Thanks be to Momentum Options Trading for providing me with some fantastic wins. I just started with this service and am up nearly 50% in less than a month. There have been losses, but if I manage them properly, I will continue the best efforts given on the blog (in which there are no complaints). What a great cause for humanity. I feel more confident about my trades and continue to play the wins. Best of all, I am now keeping my regular paychecks in the bank! Thank you!

    GREG F.
    Rick - I wanted to say thanks for getting me started on the right foot with your service. I have made six trades since starting on October 22, 2009. Five are winners and One loser netting me $6,245. Thanks again and keep the trade recommendations coming.

    NOEL
    I got into the Nike 60 Call at 1.85, sold at 5.00, also bought a 55 put at 1.05, but got stopped out at .35. What a ride! $2830.00 in the black even with the put. It's right at 100% return. I hope earnings season coming up is going to look like this trade.

    TODD F.
    Nice call on Nike. I think I'll go buy a pair with my profits! : ) I did the straddle for safety but still made 62% on the trade. Not bad for less than 24 hours. If Goldman is right, then the Nov 70s or 75's could be a steal today.

    PAUL H.
    What a sweet way to get introduced to Momentum. My first trade based on your picks and it a 2X. Thank you!

    NOEL
    “Limit order was set at 1.60 on RIMM so it sold. I may have left some money on the table but you can't go broke making a profit. That was a fun trade. Thank you. Good call. I’ve been watching and trading Rick's advice since March. It’s usually a fun ride, but I give him heck when it's wrong to. :) ”

    CHRISTIAN
    “Your service rocks! I made bank on Dendreon last week! The other thing I have to say is that it took me quite a while to find a REAL options trading service like yours. Most of what’s out there is 99% scam and very sketchy. Momentum Options Trading is the first service I found that I can trust and seriously make money with.”

    JOHN
    “I made $420.00 on ANF in 2 days. Thanks for the trade and updates on getting out of the trade.”

    CHARLES M.
    “I did follow a lot of your trades with 1-2 contracts per trade and YTD I’m up 108%. I try not to follow blindly by not entering all of your trades and sometimes entering the ones you don’t. I entered AIG a few weeks ago against recommendation – that one hurt.”

    BRYAN C.
    “I have been following you for several months and am interested in the new service. I hate to see the free service go away but as they say, “all good things must come to an end”. My ability to join will be greatly influenced by the monthly fee so I’m very curious to see the new prices. Thanks for making April a great month for me and my family.”

    JOHN H.
    “I have really enjoyed the past month since finding your blog. You have made some great calls. I would appreciate info. on the new options mentoring program. Thanks.”

    JEFFREY
    “Hi Rick, I have been following your blog for several months now and I would like to be including on the list for your new service and to receive more information about it. And yes I was a Dendreon winner with your tips. Turned $280 into $7700, and literally saved my butt.”

    ED
    “I made over 6k on your Dendreon trade, and I’m very interested in learning how you pick and trade options. Sign me up.”

    GREG
    “Rick – Wow what a day! I got in at the Dendreon calls at $2.25. Thanks to for your advice. I appreciate that. This company has a lock on this type of therapy and no one else in the world is close. Kind of reminds me of the type of companies that Peter Lynch and Warren Buffet suggest that investments be made in. Companies that can build a moat around their business model, that allows them to charge a premium for their product or service. In other words - a monopoly.”

    KEN
    “Hi Rick, Thank you so much for the Dendreon trade, I made almost $10,000 with that trade with a little over $2,000 investment. You have shown me the power of options trading. Again, thank you so much for all your inputs.”

    GARETT
    “Hi Rick, thanks for the encouragement to play the dendreon calls! did freaking great! Got in the first lot at $1.44 on 3-24-09, sold at $2.45, 70% not bad. Bought it back at $2.30 on 4-7-09 closed out on 4-14-09 for 454% gain! Wow! I love it when that happens. So, thanks the encouragement to get back in when others were saying sell, sell, sell. Keep up the good work.”

    TERENCE
    “Rick – Thanks for Dendreon – it has made all the headlines today! I missed on RIMM earlier, but I’ve been holding onto DNDN calls since 3rd week March. Of course today it all paid off today, as DNDN rocketed up.”

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