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Thursday, January 26th, 2012
12:45pm (EST)
Netflix (NFLX, $116.04, up $21) surprised Wall Street and the talking heads after the bell last night when they reported a better-than-expected quarter. The bar was already lowered so let’s get that out of the way but the results were impressive.
The company posted a profit of $40.7 million, or $0.73 a share, versus $47.1 million, or $0.87 a share, in the year-ago quarter. Total revenue checked in at $875.6 million, up 47% from the quarter last year.
Here was our chart work on Netflix at the beginning of the year when shares cleared the 50-day moving average (MA) and our thoughts:
“We aren’t sure if a bottom is in but shares could be on the verge of breaking out of a trading range (blue box) in the chart below. Yesterday’s close above $80 was bullish for a run into the $90’s (black line) which is where the next patch of resistance lies. If shares can clear this level there is a chance for a run back to triple-digits ($100-$120) believe it or not.” (END)
Here is what the chart now looks like with the $90 and $120 drawn out:
We mentioned the great chart work we have been doing lately but we failed to capitalize on this move as our portfolio has been pretty full and the options were expensive. We normally like to play options that cost $2 or less and we peaked at the Netflix February 115 calls (NFLX120218C00115000, $7.40, up $4.50) before yesterday’s close and they were at $2.80-$2.90. At the beginning of the month they were under 50 cents.
Netflix was at $95 before Wednesday’s closing bell and when we factored in a 10% price move it put shares at $104-$105 which was below the strike price. We were also nervous that customers wouldn’t be back so soon and their content costs so we sat on the sidelines. It would have been a big risk but the February 115 calls are up 150% today alone.
Netflix also trades WEEKLY options and the January 110 calls (NFLX120127C00110000, $6.30, up $4.15) were at $2.15-$2.25 before the close but these options expire tomorrow. Although the options are up 200%, we didn’t feel the risk/reward was favorable enough for us to pull the trigger. The option premiums were juiced and if Netflix would have missed estimates, these trades would have been all-or-nothings.
We’ve been doing fine without Netflix but we should’ve trusted our chart work.
As far as the market, following a gap higher at the open, the index are struggling to hold their gains. The Dow is up 10 points to 12,767 while the S&P is lower by a 4 points to 1,322. The Nasdaq is off by 9 points to 2,809.
We have a lot to cover in our Members Area today as we are taking action on another current call option trade that is up nearly 60%. We also want to cover the 2 new trades we released this morning so let’s get on it.
Tags: NFLX, NFLX earnings, NFLX options, weekly options
Posted in Company Commentary, Hot Stocks, Market Analysis, Trading Psychology | Comments Off
Wednesday, January 25th, 2012
1:15pm (EST)
Futures were strong across the board late last night following Apple’s (AAPL, $445.58, up $25.17) unbelievable quarter but when we saw futures mixed this morning, we knew the bulls would have trouble breaking through resistance. The bears have had the leverage this week as Greece continues to give Europe fits although the Fed’s cautious statements have helped matters.
The Federal Open Market Committee (FOMC) kept the range for the federal funds rate at 0%-0.25%, and repeated interest rates are likely to remain “exceptionally low” but moved the time frame even further out to late 2014. This a big change from the committee’s previous statements, which said in December that rates were likely to remain near dirt levels through at least mid-2013.
Although the markets got a lift on the news, we have been preparing for a pullback and we have used several indicators to help us call this 5-week rally. We have been questioning what will be the next catalyst to take the market higher once earnings season is over and we also said in early November when the Dow was at 11,800 that the index would rally 1,000 points to 12,800. We backed that up by going long a number of call options in which we are still ringing the resister on.
We also worked over the Christmas holidays when the Wall Street pros like to take a break and we said they would miss the rally when they got back. Sure enough, coming into the week, the Dow and S&P were up 4% for the year while the Nasdaq was showing a gain of 7%.
While we would love to see a continued rally, it feels like the market is topping and we want to make sure our portfolio is lean once there is a correction. The good news is that we have continued to play the upside by rolling into new trades while closing half positions in others along the way.
If the market can clear resistance, don’t worry, we won’t miss anything as there will be a wave of buying from Wall Street fund managers and individual investors. However, the headlines aren’t there, yet, for the bulls to run to new highs.
It remains to be seen if there will be a significant pullback and where support might hold but the choppy action is telling us something.
As we head to press, the Dow is down 4 points to 12,671 while the S&P is up a point to 1,315. The Nasdaq is showing a gain of 14 points and is at 2,801. The high for Tech has been 2,804 and it will be interesting to see if the bulls close above or below 2,800 by the close.
We have action to take on a few of our profitable positions so let’s go see where we are at. Subscribers, check the Members Area for the updates.
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Hot Stocks | Comments Off
Tuesday, January 24th, 2012
1:00pm (EST)
Futures were weak throughout the night following a collapse in the Greece debt talks and got progressively worse as the European markets opened for trading. The weak open overseas translated into a lower start here at home as the bears try to stop the bulls recent momentum.
The European Union rejected Greece’s bondholders swap for a 4% interest rate on newer bonds in exchange for the current tab which puts the country at risk for a default, again. We have seen this circus before and Greece is only part of the problem as Portugal and Italy are next in-line.
Despite the worries, the market has bounced off its lows after holding short-term support which was prior resistance.
In earnings news, Coach (COH, $68.65, up $4.41) is trading higher after beating Wall Street’s estimates by 3 cents a share. It was the fifth-straight quarter Coach has beat estimates on average by 3 cents and we were looking for an earnings miss.
We talked about the company’s impressive numbers yesterday for 2011 and how they had come in ahead of the suit-and-ties for the last 4 quarters but we were convinced they would come up short, or lower guidance, and we were wrong.
The other earnings trade we wanted to take was EMC (EMC, $24.81, up $1.37) but we didn’t like yesterday’s action in the market and decided to stay on the sidelines. We have looked at the stock as a covered call trade and yesterday we peaked at the February 25 calls (EMC120218C00025000, $0.46, up $0.23), which are up 100%, but didn’t like the idea of having 2 all-or-nothing trades.
We are 13-1 for closed trades for 2012 and we have locked in half profits on a number of other trades so we haven’t taken any new trades this week. We see a number of new option trades we like, but if we learned anything in 2010 and the first half of 2011, it is choppy markets are hard to trade and its best sometimes to wait until we get a clearer picture.
We said Sunday night in our Weekly Wrap that Greece could weigh on the market all week and how the talking heads and pros were saying this was a done deal by Monday. No agreement has been reached, yet, and here it is Tuesday.
The Fed will also take center stage on Wednesday as it prepares to release the latest minutes along with the Rate Decision during Wall Street’s lunch break. There has been talk of more easing, or starting up the money printing press again, but with tax refunds starting to come out, we think the Fed stands pat. Tomorrow will also be a big day for Housing numbers.
The big news after the bell will be Apple (AAPL, $424.12, down $3.29) which will be reporting their quarterly results. The bulls have done of a great job of brushing-off Europe’s woes once again but this week is packed with earnings as 25% of the S&P companies will be confessing. This will be the most important one.
It’s still possible the bulls can push the July and April highs on an Apple beat-and-raise but we are in a win-win situation, either way, as we have continued to play the ride up while locking in profits along the way. At some point we are expecting a pullback but our Hard Stops will lock in our profits. We also have longer dated call options that should be okay, but, if the market does take a dip we will be ready to play the pullback.
As we head to press, the Dow is down 45 points to 12,663 after kissing a low of 12,613 while the S&P 500 is lower by 4 points to 1,312 after kissing 1,306. The Nasdaq is trying to rally the troops as it is showing a gain of 2 points to 2,786.
Our Aflac (AFL, $48.40, up $0.35) call option trade has just hit a 100% return so today hasn’t been too bad despite the Coach snafu. Dendreon (DNDN, $14.11, up $0.90) is on the move again and we are just watching the action. Subscribers, check the Members Area for the updates.
Tags: AAPL, Apple earnings, COH, dndn, EMC
Posted in Apple, Covered Calls, Earnings, Hot Stocks | Comments Off
Sunday, January 22nd, 2012
10:30pm (EST)
1. Market Summary
2. Nucor (NUE) – A Core Holding
3. Earnings
4. Weekly Wrap Portfolio Update
5. Week Ahead
(To view the charts, please log into the Members Area and go to the Weekly Wrap Premium section.)
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If you are not a subscriber but would like to read more please click here. We are one of the fastest growing stock options trading advisors on the internet and we are one of the very few option newsletters which posted a powerful 2011 return. In fact, we have NEVER had a losing year since forming in 2007. We are off to a fast 14-1 start for 2012 and our subscribers have already closed 3 triple digit winning trades for gains of 124%, 100%, and 131% and another call option trade for 82%.
We offer 2-3 powerful call or put option trades each week (depending on market conditions) aimed at triple-digit returns for our Daily newsletter. Our Weekly Wrap Covered Call Portfolio strides for double-digit returns on a monthly basis and went 16-0 for 2011 and is 8-0 so far in 2012 after the trades we closed on Friday. Sign-up now and receive access instantly to our stock options trading recommendations!
If you are missing these juicy profits come give us a try. Get your password to our Members Area instantly when you sign up TODAY! One profitable trade will easily pay for your membership. You can request our 2008-2011 Track Records by sending us an email or filling out the box to the right.
Tags: blue-chip stocks, covered call option trade, momentum, momentum options, option mentoring, stock options trading advisors, straddle option trade
Posted in Hot Stocks, Market Commentary | Comments Off
Thursday, January 19th, 2012
10:50am (EST)
Our subscribers might need a wheelbarrow after we get finished with January. Time to ride the gravy train.
For those of you who use our Twitter Alerts, we are adding a NEW TRADE for our DAILY portfolio this morning. We have gotten off to a incredible start for 2012 and we see another great opportunity to make some quick profits. Subscribers, check your email inbox or the Members Area to get the latest updates. As usual, use limit prices to get the best fills.
*****************************
If you are not a subscriber but would like to read more please click here. We are one of the fastest growing stock options trading advisors on the internet and we are one of the very few option newsletters which posted a powerful 2011 return. In fact, we have NEVER had a losing year since forming in 2007.
Start 2012 with the BEST options newsletter on the internet. Last year, many pros and investment services struggled to make their clients and their paying subscribers’ money as the S&P finished flat for 2011. Not us. We were right on over 65% of our trades and our portfolio returned our subscribers over $15,000 in profits.
In other words, if you started with a $10,000 account, our option picks could have made you upwards of 150% in 2011. Over the past 4 years we are averaging a 70% winning percentage for all our trades despite volatile, flat and choppy markets. Come see why some of Wall Street’s pros are following us instead of the Journal!
Here are some of our profitable 2011 recommendations: ORLY call options +191%, VMW call options +100%, JOYG call options +169%; GS put options +184%; FDX put options +164%; OXY put options +74%; +137% on RIMM put options, +1,167% on RMBS puts in 11 days, +296% on FCX calls; +157% on ZAGG calls; +110% on LNKD puts; +133% on RLD put options.
Wait until you see our January 2012 closed trades which we will reveal in a few weeks as many of them are still active.
If you are missing these juicy profits come give us a try. Get your password to our Members Area instantly when you sign up TODAY! One profitable trade will easily pay for your membership. You can request our 2008-2011 Track Records by sending us an email or filling out the box below.
Tags: blue-chip stocks, chicken option trade, chicken trade, momentum, momentum options, option mentoring, stock options trading advisors, straddle option trade
Posted in Earnings, Hot Stocks, Trade Update | Comments Off
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Netflix (NFLX) Shocks Wall Street, Nothing New
Thursday, January 26th, 2012
12:45pm (EST)
Netflix (NFLX, $116.04, up $21) surprised Wall Street and the talking heads after the bell last night when they reported a better-than-expected quarter. The bar was already lowered so let’s get that out of the way but the results were impressive.
The company posted a profit of $40.7 million, or $0.73 a share, versus $47.1 million, or $0.87 a share, in the year-ago quarter. Total revenue checked in at $875.6 million, up 47% from the quarter last year.
Here was our chart work on Netflix at the beginning of the year when shares cleared the 50-day moving average (MA) and our thoughts:
“We aren’t sure if a bottom is in but shares could be on the verge of breaking out of a trading range (blue box) in the chart below. Yesterday’s close above $80 was bullish for a run into the $90’s (black line) which is where the next patch of resistance lies. If shares can clear this level there is a chance for a run back to triple-digits ($100-$120) believe it or not.” (END)
Here is what the chart now looks like with the $90 and $120 drawn out:
We mentioned the great chart work we have been doing lately but we failed to capitalize on this move as our portfolio has been pretty full and the options were expensive. We normally like to play options that cost $2 or less and we peaked at the Netflix February 115 calls (NFLX120218C00115000, $7.40, up $4.50) before yesterday’s close and they were at $2.80-$2.90. At the beginning of the month they were under 50 cents.
Netflix was at $95 before Wednesday’s closing bell and when we factored in a 10% price move it put shares at $104-$105 which was below the strike price. We were also nervous that customers wouldn’t be back so soon and their content costs so we sat on the sidelines. It would have been a big risk but the February 115 calls are up 150% today alone.
Netflix also trades WEEKLY options and the January 110 calls (NFLX120127C00110000, $6.30, up $4.15) were at $2.15-$2.25 before the close but these options expire tomorrow. Although the options are up 200%, we didn’t feel the risk/reward was favorable enough for us to pull the trigger. The option premiums were juiced and if Netflix would have missed estimates, these trades would have been all-or-nothings.
We’ve been doing fine without Netflix but we should’ve trusted our chart work.
As far as the market, following a gap higher at the open, the index are struggling to hold their gains. The Dow is up 10 points to 12,767 while the S&P is lower by a 4 points to 1,322. The Nasdaq is off by 9 points to 2,809.
We have a lot to cover in our Members Area today as we are taking action on another current call option trade that is up nearly 60%. We also want to cover the 2 new trades we released this morning so let’s get on it.
Tags: NFLX, NFLX earnings, NFLX options, weekly options
Posted in Company Commentary, Hot Stocks, Market Analysis, Trading Psychology | Comments Off