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Friday, January 20th, 2012
9:00am (EST)
The bulls rolled out the red carpet after the bell on Thursday as a number of companies were set to report earnings. Despite the high profile events, the market moved higher as Tech once again led the way.
The Dow gained 46 points, or 0.4%, to finish at 12,625. The blue-chips closed on their highs for the day which opens the door for a test up to 12,800 as the index ended above our near-term 12,600 target.
The S&P added a 6-pack, or 0.5%, to settle at 1,315. The index managed to stay in the green all day after testing the breakeven level shortly after the open. We said there could be fluff up to 1,325-1,350 on the close above 1,300 which would be nice for the bulls to hold going into the weekend.
The Nasdaq jumped 18 points, or 0.7%, and ended at 2,788. Tech made a run at our 2,800 target but fell short after kissing a high of 2,793.
Yesterday’s news is actually today’s headlines as we have a ton of stocks in play ahead of the open. Most noticeably, Google (GOOG, $639.57, up $6.66) shares are down a whopping 10% (like we predicted) after the company missed Wall Street’s estimates. It seems the gains on Thursday ($6.66) were a sign of bad things to come.
Google was down over $60 at one-point last night in extended trading and in pre-market action, shares are down $50 to $590.
Elsewhere in pre-market trading, Intel (INTC, $25.63, up $0.24) is up 2% after they beat estimates and offered in-line guidance for the current quarter. International Business Machines (IBM, $180.52, down $0.55) is trading higher to $185 despite missing analysts’ revenue targets but did up guidance going forward.
And finally, Microsoft (MSFT, $28.12, down $0.11) is pushing $29 after reporting a profit of $6.6 billion, or $0.78 a share, on revenue of $20.9 billion for the quarter. This was slightly below last year’s showing of $0.77 a share on sales of $19.95 billion for the quarter, but slightly ahead of the 76 cents the suit-and-ties had penciled in.
Shares of Microsoft are at $28.77, up $0.65, ahead of the bell. We currently have open trades on this name so look for possible Profit Alerts if we take action. We have a $35 price target on Microsoft by summertime but we want to take advantage of today’s possible pop to lock in profits on our February call options.
Futures are pointing towards a mixed open and look like this: Dow (-16), S&P (-3), Nasdaq (flat).
We also have some other current open trades that we may take action on this morning and we have raised the HARD STOPS for a few of them in case there is a pullback. With the weekend here, we may lock-in some triple-digit profits! Subscribers, check the Members Area for the updates and stay locked-and-loaded.
Tags: GOOG, IBM, INTC earnings, momentum options, MSFT
Posted in Earnings, Google, Market Commentary, Trade Update, Yahoo / Microsoft | Comments Off
Monday, November 28th, 2011
9:00 (EST)
The market continued its recent slide as the bears had their best bull feast in nearly 80 years as Wall Street fell 5% last week. The recent selling pressure became much more serious as all of the indexes fell below their 50-day moving averages (MA) with the bears stretching their winning streak to seven-straight sessions.
The headline news read like a Vegas betting parlor as a number of European countries face further risks of defaulting. Germany was the latest country which showed a chink in the armor after trying to raise $6 billion euro but was only able to raise a little over half of it. Spain also went to the well and was successful in its bond auction but the yields came at a hefty price. Italy faces a huge crisis in 2012 if they can’t raise more dough, and they are trying, but it’s costing them an arm-and-leg.
The news here at home continues to come in better-than-expected and this week will be big with a number of month-end reports due out. As far as the charts, they have been stretched which often happens when headline news trumps the technical picture. The bears have clearly had the advantage and at some point there will be a rebound but until Europe can figure out its mess, the market will be held hostage.
The Dow slipped 26 points, or 0.2%, to finish at 11,232 on Friday’s shortened session. We went into the week looking for 11,600 to hold but that level was taken out on Monday. Our next downside targets were 11,400 and then 11,200, which held, but there is risk down to 10,800 this week if current levels don’t hold. If the bulls can get past 11,400 (black line, purple circles) then they could make a run back towards 11,600 and then 12,000 but the news has got to be awfully good. For the week, the Dow dropped 564 points, or 4.8%, and is now down 346 points, or 3% YTD…
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If you are not a subscriber but would like to read more about where the market is headed and to take a closer look at our chart work along with our current trades, please click here. Since early August we have made 48 recommendation, both calls and puts, and have hit on 40 out of 48 trades for a winning percentage of over 80%! Some of our recent winners include:
+169% on Joy Global (JOYG) call options in 2 days
+137% in Research In Motion (RIMM) put options in 3 weeks
+130% in Spreadtrum Communications (SPRD) call options in 4 weeks
+164% in FedEx (FDX) put options in 6 days
+184% in Goldman Sachs (GS) put options in 5 days
+191% in O’Reilly Automotive (ORLY) call options in 17 days
+100% in VMWare (VMW) call options in 4 days
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Futures are pointing towards a strong start for today’s session and look like this: Dow (+255), S&P 500 (+34), Nasdaq 100 (+53). We recommended 4 new trades on Friday and after two weeks of being patient and building new positions, hopefully we get the surge we have been expecting. Subscribers, check the Members Area for the updates.
Tags: Dow, Momentum stocks, stock options trading advisors
Posted in Apple, BioTech, China, Commodities, Company Commentary, Covered Calls, Earnings, Economic News, Entertainment Stocks, European Union (EU), Financial Stocks, Futures, Gold, Google, Hot Stocks, IPOs, Market Analysis, Market Commentary, Mergers and Acquisitions, Money Management, Oil, Option Trades, Rick's Account, Sectors, Stock Earnings, strangle option trades, Trade Update, Trading Psychology, Trading Tips, Uncategorized, VIX, Watch Lists, Yahoo / Microsoft | Comments Off
Friday, April 15th, 2011
8:50am (EST)
The bulls got their second straight win on Thursday but the margin of victory matched Wednesday’s slight gains. The bears dominated the early action after hearing initial jobless claims rose by 27,000 week-over-week to 412,000. Wall Street was looking for 385,000 and the jump back over 400,000 was the headline shocker. This was the first time in more than a month initial claims exceeded 400K which caused the weakness at the open.
Financial stocks also broke down (again), after rallying past their 50-day moving averages last week. The lack of leadership from this sector is really starting to weigh on the bulls and we mentioned yesterday that it will take another quarter or two before they bottom or start to rebound. We took a chance that there would be a slight rally but we got punched in the face by JPMorgan (JPM, $44.97, down $1.28) which told us to wake up.
Oil was also up and closed above $108 a barrel but somehow, someway, the bulls got a “W”.
The Dow added 14 points to finish at 12,285 but traded to a low of 12,163. The index did reach a high of 12,305 which was prior support but is now acting like resistance. The break below 12,200 has our attention as it appears 12,000 could come into play as early as next week.
The S&P was up less than a point and remained at 1,314 after trading down to 1,302. We mentioned on Monday the close below 1,325 spelled 1,300 for the index. More importantly, a break below 1,300 leads way to 1,275-1,250.
The Nasdaq was down a point and closed at 2,760 but made another “lower, low” after falling to 2,733. We have outlined 2,700-2,650 as the bears next near-term target area.
There are a few major earnings reports we will cover today but let’s focus on Google (GOOG, $578.51, up $2.23) which announced their numbers after the close yesterday. The company was expected to earn $8.11 but profits came in at $8.08 a share.
Revenue surged 27% to $8.6 billion but after commissions to its ad partners, Google’s revenue came in at $6.54 billion. This was still ahead of analysts’ estimates for revenue of $6.33 billion but expenses have ballooned at the company which is on a hiring spree and included a sweet 10% raise the company gave to ALL its employees at the beginning of the year.
Google has its fingers in a lot of pies so it makes sense that the company wants to attain the best and brightest workers to grow their business but Wall Street is impatient.
We said last night shares would be at $600 or $550 in after-hours and they were. Although it’s only a 5% move, the headline will be Google is down $30 at the open.
Futures are pointing towards a flat start this morning. The Dow futures are lower by 2 points t o 12,226 while the S&P 500 futures are up a fraction to 1,310. The Nasdaq 100 futures are down 2 points to 2,298.
We have added some new names to our Watch List and we may release a trade today for either our Daily newsletter or Weekly Wrap. If so, expect a Trade Alert before noon and after 10am. Subscribers, check the Members Area for the updates.
Tags: call option trades, chicken trades, GOOG, momentum options, Momentum stocks, options trading course, put options, stock market options, stocks that trade weekly options, strangle option trades, weekly options
Posted in Google, Hot Stocks, Market Analysis | Comments Off
Thursday, April 14th, 2011
1:25pm (EST)
It’s all about the notes…
We have been busy today, folks, and there are a lot of good stories to talk about so we are going to be quick because we have a lot to go over in our Members Area.
The bears dominated the early action this morning but the bulls have fought back as we head towards the second half of trading.
The Dow is down 13 points to 12,257 while the S&P is off by 3 points to 1,311. The Nasdaq is lower by 14 points to 2,747.
Google (GOOG, $577.00, up $0.72) announces earnings after the bell. We will be listening to the company’s conference call with a Bob Segar classic in the background…Turn the Page. All eyes will be on the company’s CEO, Larry Page, who recently took back the gig to run Google.
Google doesn’t make the dramatic moves like past years after posting their numbers but this time could be different. If we had to guess, we think shares hit $600 or trade down to $550 in after-hours trading.
We will be back in the morning with a full update.
Tags: call option trades, chicken trades, GOOG, momentum options, Momentum stocks, options trading course, put options, stock market options, stocks that trade weekly options, strangle option trades, weekly options
Posted in Google | Comments Off
Friday, February 4th, 2011
1:05pm (EST)
We often get asked why we don’t recommend options on stocks like Apple (AAPL, $345.21, up $1.77), Google (GOOG, $609.59, down $0.56) or IBM (IBM, $163.46, down $0.07). These stocks show tremendous price action and there are numerous, other, momentum stocks we do follow but shy away from trading options on.
Trust us, we would love to trade options on the “high-flyers” and we have in the past and do from time to time but one thing these companies all have in common is that their shares trade in the triple-digits. This means option premiums are expensive and instead of buying options that are $1, you are paying $5, or even $10 for a near-term slightly out-of-the-money call or put. So, if you like to buy 10 contracts for every trade then instead of spending $1,000, you are spending $10,000. Big difference.
We like to use 5% moves in a stock to make 100% on our option trades and it is a lot easier doing it on stocks that are under $100.
To give you an example, Google call options are/were very popular for years after the company became public. Our editor-in-chief, Rick Rouse, use to recommend these types of trades back in the day and here is a breakdown of one of his trades.
In October 2005, Google was just under $300 a share heading into earnings and of course, they knocked the cover off the ball as they were smashing estimates quarter after quarter back then. The November 310 call options were at $10 when he profiled the trade and by mid-November the stock was at $400. The options were at $90 and the return was 800%.
You could also buy just 1 option contract on the higher priced stocks but most of the times the bid/ask is wide enough to drive a tank through and volume is light. By playing options on stocks under $100 there is more liquidity and closer strike prices to where the stock is currently trading at.
Although we do occasionally play options on the high-flyers, we were glad to see Freeport-McMoRan (FCX, $56.89, up $0.63) do a 2-for1 stock split this week. We love playing this name and you will see over the years we have used calls AND puts when it comes to trading Freeport. It just depends on the trend.
While it is so true that stocks splits don’t mean a thing - instead of owning 50 shares of a $100 stock, you now own 100 shares of a $50 stock on a 2-for-1 – stock splits are helpful when it comes to playing options.
Freeport has become a pure-play on copper (and gold to a degree) and has just become another candidate for our Watch List. We aren’t profiling any options just yet because we want to do a little chart work over the weekend but you can bet our subscribers will be seeing this name in the future. Now, if we could only get Apple or Google to do a 10-for-1 stock-split.
Next week should be busy and we have few high-profile earnings announcements we are watching. Cisco Systems (CSCO, $22.05, up $0.14) and Walt Disney (DIS, $40.52, up $0.02) will report earnings, as well as Akamai Technologies (AKAM, $47.84, down $0.27) and Advanced Auto Parts (AAP, $63.72, up $1.24) just to name a few.
We are also working with a new auto-trading partner, Stifel-Nicolaus, and we will be posting more information in the coming weeks on how you can sign up through our website to have our option recommendations filled for you automatically. For those of you that want a head start, go here.
We are excited to bring them on board and we are working with a few other partners (OX) to cover some of the other brokerage firms our subscribers use. If you have a request, please let us know and we will look into it.
As we head to press, the market is mixed but is showing signs of moving higher into the closing bell. The Dow is down 3 points to 12,059 while the S&P 500 is off less than a point to 1,306. The Nasdaq is higher by 6 points to 2,760.
We released 2 new trades earlier today and we are closing another one to lock in profits. This brings our track record for 2011 to 10-out-of-11 winning trades with 3 triple-digit winners! If you wanna see the results, trade by trade with exact entry and exit prices and on what day they were opened and closed, email us.
We will be back on Sunday night with the Weekly Wrap. Until then, have a great weekend!
Tags: best option trader, best trading signals, call options, chicken trade, Covered Calls, financial options advice, momentum options, Momentum stocks, momentum trading, option mentoring, option signals, option trading, options broker, options newsletter, put options, stock broker, strangle option trade, winning option trades
Posted in Google, Hot Stocks | Comments Off
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Microsoft (MSFT) Keeps Momentum, Shares Up
Friday, January 20th, 2012
9:00am (EST)
The bulls rolled out the red carpet after the bell on Thursday as a number of companies were set to report earnings. Despite the high profile events, the market moved higher as Tech once again led the way.
The Dow gained 46 points, or 0.4%, to finish at 12,625. The blue-chips closed on their highs for the day which opens the door for a test up to 12,800 as the index ended above our near-term 12,600 target.
The S&P added a 6-pack, or 0.5%, to settle at 1,315. The index managed to stay in the green all day after testing the breakeven level shortly after the open. We said there could be fluff up to 1,325-1,350 on the close above 1,300 which would be nice for the bulls to hold going into the weekend.
The Nasdaq jumped 18 points, or 0.7%, and ended at 2,788. Tech made a run at our 2,800 target but fell short after kissing a high of 2,793.
Yesterday’s news is actually today’s headlines as we have a ton of stocks in play ahead of the open. Most noticeably, Google (GOOG, $639.57, up $6.66) shares are down a whopping 10% (like we predicted) after the company missed Wall Street’s estimates. It seems the gains on Thursday ($6.66) were a sign of bad things to come.
Google was down over $60 at one-point last night in extended trading and in pre-market action, shares are down $50 to $590.
Elsewhere in pre-market trading, Intel (INTC, $25.63, up $0.24) is up 2% after they beat estimates and offered in-line guidance for the current quarter. International Business Machines (IBM, $180.52, down $0.55) is trading higher to $185 despite missing analysts’ revenue targets but did up guidance going forward.
And finally, Microsoft (MSFT, $28.12, down $0.11) is pushing $29 after reporting a profit of $6.6 billion, or $0.78 a share, on revenue of $20.9 billion for the quarter. This was slightly below last year’s showing of $0.77 a share on sales of $19.95 billion for the quarter, but slightly ahead of the 76 cents the suit-and-ties had penciled in.
Shares of Microsoft are at $28.77, up $0.65, ahead of the bell. We currently have open trades on this name so look for possible Profit Alerts if we take action. We have a $35 price target on Microsoft by summertime but we want to take advantage of today’s possible pop to lock in profits on our February call options.
Futures are pointing towards a mixed open and look like this: Dow (-16), S&P (-3), Nasdaq (flat).
We also have some other current open trades that we may take action on this morning and we have raised the HARD STOPS for a few of them in case there is a pullback. With the weekend here, we may lock-in some triple-digit profits! Subscribers, check the Members Area for the updates and stay locked-and-loaded.
Tags: GOOG, IBM, INTC earnings, momentum options, MSFT
Posted in Earnings, Google, Market Commentary, Trade Update, Yahoo / Microsoft | Comments Off