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Monday, January 11th, 2010
1:00pm (EST)
The market started off on a strong note but has given back some of its gains as Wall Street awaits Alcoa’s (AA, $17.25, up $0.23) earnings report. The Dow is currently up 10 points to 10,628 while the S&P 500 is off by 3 points to 1,142. The Nasdaq is showing a decline of 13 points and is trading at 2,304 as we head to press.
The VIX is down 0.56 to 18.36, Oil is up fractionally at $82.75 and Gold is up $16 to $1,155 an ounce.
Alcoa will report earnings after the bell and Wall Street is looking for a profit of 6 cents a share on revenue of $4.8 billion. In the year ago quarter the company reported a loss of 28 cents a share on revenue of $5.7 billion.
The options pits are exploding with traders placing bets but we are staying on the sidelines with this one. The January 17.50 calls (AAAT, $0.53, up $0.25) are up 90% and have traded nearly 30,000 contracts while the January 17.50 puts (AAMT, $0.77, down $0.22) have dropped over 20%. This means the market is pricing in a 7%-8% move in the stock and a straddle trade would cost you $1.30 at current prices. No thanks, we’ll pass.
We have been busy updating our portfolio positions this morning and we were able to get into two NEW trades at the open. We are also CLOSING one trade for a slight profit to make room as we like the prospects a little better on our newer trades.
Current subscribers, please check the Members Area for the important updates.
Tags: Alcoa 4Q earnings report, Alcoa Earnings, alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, chicken option trades, Covered Calls, financial, financial investment, funds, future option trading, futures trading, gold investing, guide to investment, guide to options, guide to options trading, hedge fund, hedge funds, how to invest, income, index funds, index options, invest, invest money, investing for dummies, investing market, investment, investment advisor, investment management, investment services, investment strategy, investments, journal Wall Street, momentum stock option trading, mutual investing, new Wall Street, on Wall Street, online option trading, online trading system, option call, option exchange, option investment, option picks, option price, option selling, option trade, option trade picks, option trading online, options, options alerts, options blog, options expiration, options mentoring, options newsletters, options signals, options track record, options trade, options trading, options trading strategies, private equity, put option trading, Rick Rouse, software options, stock, stock exchange, stock investment, stock market, stock market options, stock option trade pick service, stock option trading, stock price, stock quotes, stock share, stock trading, straddle option trades, strangle option trades, strategies options, support and resistance levels, the Wall Street, trading, trading option, trading options, triple-digit option trades, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Earnings, Gold, Market Analysis, Oil, VIX | Comments Off
Wednesday, December 23rd, 2009
12:25pm (EST)
The bulls are trying to take the market higher for the fourth day in a row and the Dow is flat as we go to press at 10,464.
We have updated all of our trades and we are super busy today. We would love to give a full market update today but the action is in the Members Area.
Barrick Gold (ABX, $40.64, up $1.75) has made a move above $40 today which is great news for our subscribers who got into the trades yesterday.
Current subscribers, check the Members Area for the updates…
Tags: alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, chicken option trades, Covered Calls, financial, financial investment, funds, future option trading, futures trading, gold investing, guide to investment, guide to options, guide to options trading, hedge fund, hedge funds, how to invest, income, index funds, index options, invest, invest money, investing for dummies, investing market, investment, investment advisor, investment management, investment services, investment strategy, investments, journal Wall Street, momentum stock option trading, mutual investing, new Wall Street, on Wall Street, online option trading, online trading system, option call, option exchange, option investment, option price, option selling, option trade, option trade picks, option trading online, options, options blog, options expiration, options mentoring, options newsletters, options track record, options trade, options trading, options trading strategies, private equity, put option trading, Rick Rouse, software options, stock, stock exchange, stock investment, stock market, stock market options, stock option trade pick service, stock option trading, stock price, stock quotes, stock share, stock trading, straddle option trades, strangle option trades, strategies options, support and resistance levels, the Wall Street, trading, trading option, trading options, triple-digit option trades, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Gold, Hot Stocks, Market Analysis | Comments Off
Friday, December 11th, 2009
1:10pm (EST)
The bulls are looking to end the week on a high not as they have pushed the market higher for the third straight day. The interesting thing about today is that the dollar is higher. We have mentioned how the market has trended higher on a weaker dollar and that Wall Street has been worried about the “reversal trade”. Basically, it means that they believe once the dollar started to rebound the market would head lower. Well, we aren’t seeing that today and we have talked about how overblown this theory may be.
Of course, anything can happen but our end-of-year target for the Dow is 10,800. The Dow is currently at 10,418, up 12 points, so that would mean we are looking for another 400 points. That might be a reach for the bulls and next week could get interesting as there a number of key events we will be watching.
Gold is at a one-month low while oil is at a two-month low. The yellow metal is down another $10 to $1,117/ oz. while “black gold” is down 54 cents to $70 a barrel.
Well, it didn’t take long for Wall Street to come out with a rating for AOL (AOL, $23.45, down $0.07). Sanford Bernstein came out with an “Outperform” rating for yesterday’s IPO. We followed the company when it traded in the 90’s…that would be the 1990’s, but can’t see the logic in slapping an “Outperform” rating on a company Time Warner (TWX, $30.52, up $0.07) was dying to get rid of.
Elsewhere, Research In Motion (RIMM, $63.80, down $2.00) has been all over the map and bets are being placed on if the stock is either going to test its 52-week high of $88 or its recent low of $55. We have an option trade waiting in the wings Monday morning for this one…
It is a strangle option play and we think it has a chance of hitting a triple-digit return. The company will announce earnings next Thursday AND the December options expire the following day. Folks, the last time RIMM announced earnings the stock dropped from $82 to $68. If you are not a current subscriber, signup this weekend as we think this one trade could bring some holiday cheer.
We have updated our current trades before we head out for the weekend. We will be back Sunday night with the Weekly Wrap…
Tags: call option trading, chicken option trades, Covered Calls, momentum stock option trading, option trade picks, option trading online, options blog, options mentoring, options newsletters, options track record, put option trading, Rick Rouse, stock option trade pick service, straddle option trades, strangle option trades, support and resistance levels, triple-digit option trades
Posted in Company Commentary, Earnings, Gold, Oil | Comments Off
Sunday, December 6th, 2009
10:40pm (EST)
The bulls were off and running on Friday as the Dow opened with a triple-digit gain after Wall Street learned the unemployment rate fell to 10% in November from 10.2% in October before the bell. Most of the suit and ties figured the jobless rate would remain at 10.2% but a positive nonfarm payrolls report offered clues on Thursday.
The market also got a better than expected factory orders report 30 minutes after the open but before lunch the bulls were packing it up and heading out for the weekend. The markets then fluctuated the rest of the day on the strengthening U.S. dollar but still managed to finish the day and week higher.
The Dow was up 22 points to 10,388 and finished the week with a slight 0.8% increase. Not bad for five days worth of work but the Nasdaq carried the load as it settled at 2,194, up 21 for the day, and 2.6% for the week. The S&P 500 gained 6 to 1,105 and added 1.3%, respectively.
As you can imagine, some stocks rallied off the “good” unemployment report. Manpower (MAN, $56.77, up $5.39) soared 10% and hit a high of $58, Monster Worldwide (MWW, $16.83, up $1.80) popped 12% and Robert Half International (RHI, $25.74, up $2.56) jumped 11%.
Big Lots (BIG, $28.08, up $4.54) had a BIG Friday as shares zoomed nearly 20% after the national closeout retailer announced 3Q profits that more than doubled Wall Street’s expectations. The company earned $30 million, or $0.37 a share, compared with $12 million, or $0.15 a share, a year earlier. Wow. We were eyeballing this one in the Weekly Wrap last Sunday as an “earnings play” but felt nervous on recommending this one after our Aeropostale (ARO, $28.95, flat) debacle.
We should have stuck with our game plan as the Big Lots December 25 calls (BIGLE, $3.10, up $2.50) gained over 400% on Friday. Want one better? The BIG December 27.50 calls (BIGLY, $1.10, up $1.00) were up an astounding 1,000%! Now you know why we like earnings trades…
Elsewhere, Bank of America (BAC, $16.28, up $0.52) added 3% after it announced plans to repay $45 billion in TARP funds as it looks to find a new CEO. Hard to believe this stock was at $3 in March. We made some great option trades on the stock’s climb back to $20 which is where it ran out of gas back in October. We aren’t ready to jump back into this one but we are watching the developments.
Gold has a wild week and hit a record high of $1226 per ounce, but ended the week at $1161/ oz. after plunging $52 on Friday. We were preaching that the gold bugs were getting ahead of themselves last Wednesday when we heard “Gold $5,000″.
We don’t think the rally in gold is over but it only took two days after that retarded call for gold stocks to plunge. Barrick Gold (ABX, $42.68, down $4.16) fell 9%, Newmont Mining (NEM, $52.05, down $2.43) dropped nearly 5% and Goldcorp (GG, $42.27, down $2.88) sank 6%. Also, Freeport-McMoRan (FCX, $79.87, down $3.93), a play on copper and gold, slipped 4.7%.
Crude oil closed down $1 to $75 while natural gas gained 13 cents to $4.59.
We will be back in the morning with the companies reporting earnings this week and the current trade updates.
Tags: call option trading, chicken option trades, Covered Calls, momentum stock option trading, option trade picks, option trading online, options blog, options mentoring, options newsletters, options track record, put option trading, Rick Rouse, stock option trade pick service, straddle option trades, strangle option trades, support and resistance levels, triple-digit option trades
Posted in Commodities, Company Commentary, Gold, Market Analysis, Market Commentary, Oil, Option Trades, Weekly Wrap | Comments Off
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Bears Waking Up
Wednesday, January 20th, 2010
1:00pm (EST)
The market has been in negative territory all morning and we don’t expect much to change in the afternoon session. Most of the indexes are holding support but things could get ugly. We have mentioned how we thought the market was approaching a top in the Weekly Wrap and although it’s too early to tell if we are in correction mood it is starting to feel like one.
Last Friday, we also had this to say:
“We have mentioned our targets for the indexes and from our camp it looks like the market is nearing a top which makes it harder to trade. It’s possible we rally for a few more weeks but once we get to February we think there’s a chance of a 5%-10% pullback.” (END)
If the above scenario does play out like we have mapped out then maybe we see another good buying opportunity. Maybe we don’t and the market will continue even lower. One thing for certain, volatility is picking up.
Currently the Dow is down 183 points to 10,541 while the S&P 500 is off by 18 points to 1,131. Meanwhile, the Nasdaq is getting trounced for a 43 point loss and is at 2,277.
There are some other “interesting” stories that we want to highlight…
We did our best Linda Blair when we heard the news this morning that Apple (AAPL, $211.09, down $3.95) is in talks with Microsoft (MSFT, $30.40, down $0.70) about putting Bing, Microsoft’s search engine, on its iPhone. Apple currently uses Google’s (GOOG, $577.42, down $10.20) search engine. Folks, the war between Apple and Google is growing by the minute and we could be setting up for an epic battle.
Elsewhere, Rambus (RMBS, $24.30, up $$3.17) has finally gotten “its day in court”. The company got a huge $1 billion settlement against Samsung Electronics after years of litigation. The settlement was actually for $900 million but we wanted to round up as we expect Rambus to settle or win its other cases.
Samsung has agreed to drop all claims and will pay the money over five years.
The Gold stocks are taking a step back today and we are eyeing Barrick Gold (ABX, $37.55, down $2.11) as it is resting at support levels. We aren’t quite sure if the stock is ready to fold like a cheap lawn chair or pop like a cork but there is volatility which is something we love when trading options.
We will be back in the morning and we have updated the Members Area for our current trades. Oh, and a special thanks to Eric who did the voice over on our video. Folks, if you haven’t seen it yet, take a peek. Scroll down the home page and you will see it.
Tags: Apple Microsoft iPhone pact, barrick Gold straddle options trade, Bing serach engine, option picks, option signals, options alerts, Rambus litigation issues, stock options trading
Posted in Company Commentary, Gold, Market Analysis, Trading Psychology | Comments Off