|
|
|
|
|
 |
|
|
 |
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
Wednesday, December 2nd, 2009
1:10pm (EST)
Folks, there is more action in our Members Area than a poker table on payday.
Trading is choppy today as the Dow has darted in and out of positive territory. We are currently at 10,437, down 34 points. The S&P 500 is at 1,107, down 2 points, but is holding 1,100.
We thought we had heard it all with the gold price targets but today an analyst came out and said “Gold $5,000”. We were just talking about this in the morning update and needless to say we are blown away.
In any event, it has helped Barrick Gold (ABX, $47.29, up $1.22) set another 52-week high today. Those December 45 calls (ABXLI, $3.10, up $0.90) we mentioned this morning opened at $2.58.
Another stock that is showing unbelievable strength is Amazon.com (AMZN, $141.05, up $2.55). The stock closed last Friday at $131 but we were hesitant to pull the trigger on an option trade because of the massive sell-off we got on Friday but the stock always seems to rally in the weeks leading up to Christmas.
We have a lot to talk about in our Members Area and we wanted to update the trades we sent out to our subscribers at high noon. If you are not yet a subscriber, we do hope you consider a subscription before we get filled.
Tags: Barrick Gold, momentum stock option trading, option trading online, option trading picks, options mentoring, options newsletters, options track record, support and resistance levels, triple-digit option trades Posted in Gold, Market Analysis, Option Trades | Comments Off
Wednesday, December 2nd, 2009
It’s as if the Dubai news never happened…
The market picked up more momentum on Tuesday, as the Dow added 126 points to close at 10,471. We mentioned in the Weekly Wrap there was evidence of “baby bulls” when we were talking about Friday’s market correction…
“The Dow was pressured right from the jump and at one point sank to a low of 10,230 before finishing the day with a 154 point decline. We had factored in a drop to 10,100 but during the panic, the “baby” bulls stepped-in and lifted the market. The Dow had started the week at 10,318 and we ended at 10,309. The fact this level held while Wall Street was on vacation was impressive given the curve ball we got.” (END)
If you remember, the first reports of the Dubai World debacle had the debt at $60 million and whispers were calling for as much as $80 million in the hole. The fact that they are working to restructure a smaller debt ($26 billion) has put the event in Wall Street’s rear-view mirror.
In fact, the bulls pushed the Dow above 10,500 for the first time since October of last year. We have been calling for Dow 10-8 and given the trend it seems like that target could be reached.
However, let Friday’s “warning” ALWAYS be a reminder that you should try to have both call AND put options in your portfolio. If you will look at all of our trades from 2009, month-to-month, you will notice we like to follow this rule. Sometimes we get caught too and we were stopped out of some nice trades but don’t let these “events” scare you.
We want momentum, either up or down. In other words, we want action. The bulls have been pretty much unstoppable since March and we will top out at some point. Until then, all we can do is play the trend because after all, the trend is your friend…
The dollar continues to get pounded like a porn star and at some point, it too, will rebound. The current trend has been a weaker dollar and a higher stock market. This pattern that has played out for months and we will have to wait and see at what point this doesn’t work anymore.
And Gold…we are already hearing cat calls of $1,600 and Gold $2,000. That worries us but at the same time we continue to watch the gold stocks go bananas. Barrick Gold (ABX, $46.07, up $3.38) jumped another 8% yesterday and set a 52-week high in the process.
We spotted the potential breakout in Barrick Gold back in November and for those of you who have yet to see our Members Area; here was the trade on 11/3/09 that returned our subscribers 38% in two days. (Quotes are from that day)
“Barrick Gold (ABX, $38.97, up $2.46)
Buy to OPEN November 40 calls (ABXKH, $1.20, up $0.73)
These calls have been exploding this morning. They OPENED at 40 cents and we started watching them at 60 cents. These calls could make a run to $2.00 and they are moving fast. Do not pay over $1.30-$1.35 for them. This will only be a one or two day trade and the stock appears to be headed to over $40. Its 52-week high is $42.10.” (END)
If you will notice, our trade setup was for a one or two day window and we followed our trading plan to a “T” by closing the call options for $1.65. We should have stayed on the action and maybe we should have rolled some of those profits into the December 45 calls (ABXLI, $2.20, up $1.49) which zoomed 200% yesterday but we didn’t see the continued breakout in the stock.
We still don’t know how high gold goes but one thing is clear, it is on a roll right now.
Tags: Barrick Gold, momentum stock option trading, option trading online, option trading picks, options mentoring, options newsletters, options track record, support and resistance levels, triple-digit option trades Posted in Gold, Hot Stocks, Market Analysis, Market Commentary, Option Trades, Trading Psychology | Comments Off
Wednesday, November 4th, 2009
9:15am (EST)
Futures are up big this morning and it looks as though the bulls will start today’s session on offense. Dow futures ar up 66 to 9,783, S&P 500 futures are up 8 to 1,050 while the Nasdaq 100 futures are also up 8 to 1,683.
Comcast (CMCSA, $14.51) is slightly higher this morning in pre-market trading after reporting earnings of $944 million, or $0.33 a share, compared with $771 million, or $0.26 a share, in the same quarter a year earlier. Revenue was $8.8 billion, which was slightly shy of the $8.85 billion Wall Street was looking for.
One other interesting development this morning…Walt Disney (DIS, $27.62) announced it has gained approval from China to build a Disneyland theme park in Shanghai. We like the deal but we also like Imax’s (IMAX, $10.77) potential in China as well…
Gold is up again this morning…
We have lots more going on this morning but the real action is in the Members Area where our current subscribers closed another triple-digit winner yesterday. We also profiled TWO trades on Tuesday that have gotten off to a good start…
Tags: Comcast, Imax, options blog, options mentoring, options track record Posted in Company Commentary, Earnings, Gold, Market Commentary, Option Trades | Comments Off
|
|
|  | | | |
Bulls Going For Hat Trick
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