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Gold $5,000?

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.

MomentumOptionsTrading.com Morning Update for 12/02/09

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.

Futures Up, Market Set To Open Higher

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…

Bulls Resting

Friday, September 11th, 2009

1:20pm (EST)

The market is trending lower today although the bulls were out early.  The Dow is currently down 49 points to 9,578 while the Nasdaq is off by 12 to 2,072.  The S&P 500 is lower by 5 points and stands at 1,039.  Although stocks are struggling, gold is back over $1,000 and has managed to make its way to a fresh high of $1,010/ ounce for the year.

FedEx (FDX, $77.26, up $4.60) is up 6% after raising its earnings forecast.  I had mentioned earlier in the week that this is “pre-earnings” announcement season and the company said it now expects to earn of $0.58/ share.  FedEx had previously predicted earnings of $0.30-$0.45/ share.  Wall Street had been looking for a profit of $0.44/ share.  Although international revenues are improving, the company is getting better numbers thru cost cutting.

I’ll be back Sunday night with the Weekly Wrap.  Oh, don’t forget to thank a Vet today and take 60 seconds to remember our lost brothers and sisters for 9/11….

Subscribers, please check the Members Area for a 1:20pm trade update!

Rick@MomentumOptionsTrading.com

Gold Breaks Four Figures

Tuesday, September 8th, 2009

9:10am (EST)

Gold has toped the $1,000 an ounce level this morning as it is up $11 to $1,007.  Futures are pointing towards a big open.  Dow futures are up 80 to 9,497, S&P 500 futures are up 10 to 1,024 while Nasdaq 100 futures are up 14 to 1,650.

Oil is up $3 to $70.95.

There is a lot of news out this morning.  General Electric (GE, $13.87) has a pre-market bid of $14.46 after getting an upgrade.  Apple (AAPL, $170.31) also got another upgrade and will be a stock to watch this week.

If my calculations are right, we should see at least a 50 point gain on the Dow at the open.  If so, we could quickly hit a triple-digit gain in the first 10 minutes.

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
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    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.
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    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.

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    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!

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    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.

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    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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