|
|
|
|
|
 |
|
|
 |
Wednesday, December 9th, 2009
9:00am (EST)
The market had a lousy Tuesday and it was one of them days where you just knew we were going to stay in the red. Futures were pointing towards a crummy open and the bulls did not do a good job of holding the Dow above 10,300. We have talked a lot about support and resistance levels lately and while they aren’t exact they help us stay focused.
The Dow finished the day with a 104 point loss to close at 10,285 but we aren’t THAT worried about…yet. The “zones” we have been going through still favor the bulls but we might get one foot ready for the back door if we fall below Dow 10,000. That being said, we still think a “blow the top off the roof” type rally could be in the cards.
The S&P 500 fell 11 points and closed at 1,091. We still have support at 1,067 but if that level fails it could crack the seal for further leakage. If the bathroom line is full and you’ve had a bunch of beers this is how 1,067 is going to feel for us…
From the “Where have you been department”:
Every now and then have we will find a stock that looks really good for a option trade and one of the first things we look for is volume. Most of you know we don’t buy stocks because they take too much capital and the returns from options simply dwarf the returns you get from stocks. Remember, a 5% move in a stock can mean a 100% return in the right option which is why we play the game.
If a stock has low “daily volume” then it means the options are probably thinly traded as well. When we do option trades we try to pick stocks that have a lot of volume because the bid and ask on the options are usually between 5-10 cents and the options are liquid. We also like to pick stocks that are volatile so that we can play them both ways. Call options on the way up, and put options on the way down.
One stock we were/ are bullish on is AthenaHealth (ATHN, $44.96, down $1.10) which hit a high of $47.75 last Friday. Here were our thoughts from July 20th (quotes from that day):
ATHN Could Challenge New High
AthenaHealth (ATHN, $38.03, up $1.64) could see some action as the healthcare reform bill is heating up. The options aren’t as liquid as other stocks…the August 40 calls (QJNHH, $1.55, up $0.55) have only traded 10 contracts.
The September 40 calls (QJNIH, $1.95, up $0.60) have traded about 50 contracts but because of the low volume we may crowd this trade if people start piling in. That could be a good thing as well.
AthenaHealth’s CEO, Jonathan Bush, has made the TV rounds and he is worth listening to. I love his insights on the HealthCare sector but the option pits just don’t have the volume. Let’s see where these things end up in a month or two but because of the low volume, I’m staying away. The stock might be the better buy if you are looking for some quick profits. The 52-week high is $39.29… (END)
Aeropostale (ARO, $31.06, up $0.86) got upgraded to “Buy” yesterday with a long-term price target of $45. The stock made it to a high of $31.50 and held its gains for most of the session. If the company would not have scared the BeJesus out of Wall Street when they announced earnings last week, the stock would be above $35 by now…
As we head to press, Dow futures are up 30 to 10,301 while the Nasdaq 100 futures are higher by 9 points to 1,777. The S&P futures are showing a 4 point gain to 1,094.
Although the market slid, we did pretty well with our trades yesterday. Current subscribers, check the Members Area for the current trade updates this morning.
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, Hot Stocks, Mergers and Acquisitions, Rick's Account, Strategies | Comments Off
Friday, August 28th, 2009
8:55am (EST)
Well, time to open up the playbook.
It may be preseason in the NFL but in option trading we are in the game every day. I’ve been pretty limited with our playbook because I have been feeding you a lot of information lately on how to use options but I’m excited.
We all know I have been putting in tight stops on some plays and loose stops on other trades. The reason I do that is beacuse I want each and every single one of you to make a ton of money. I get emails daily and as you would imagine most are good and some are bad. That is the nature of the game when you run a trading service and I know that.
The most important thing I want you to know is that if you are beginner option trader, don’t jump into this whole option trading thing blindfolded. Take some of the trades and follow them on paper. When my trading manual is ready, you will see how everything works in a better picture. And realize some of the trades I do are based how I manage money. All right, enough rambling…
I am looking at Citigroup (C, $5.05, up $0.42) once again and here is the deal. If you made 114% and 80% like you should have on the Citigroup trade then why not take that money and double down? The break above $5 was huge yesterday and that changes the ballgame because the stock becomes “marginable” again.
Buying on margin is like a double-edged sword. Margin buying is when you buy a stock with cash borrowed from your brokerage account using other stocks as collateral. By doing this, it will have a huge effect on any profit or loss you may have.
I have profiled the Citigroup January 7.50 calls (CAQ, $0.29, up $0.09) and the January (2011) 10 calls (VRNAB, $0.58, up $0.15) and they are a BUY today. We are going to do a “layered’ trade on Citigroup and here is what it will cost.
I always buy 10 contracts or more of an option and I’ve explained this because of brokerage fees. I usually do 20 lot trades and “half’ trades are normally 10 option contracts and sometimes even 5 contracts if the options are expensive.
If you buy 30 contracts of the January 7.50’s it’s gonna cost you $700. If you buy 20 of the 2011 January 10’s it’s gonna run you about $1,200. That is $2,000 in a layered Citigroup trade at current prices and that is usually how I manage each trade in my trading account. Sometimes when I say “do a half position” that means buying only 10 or even 5 contracts which means I’m only putting up $500 or $1,000. I have stuck to this plan for years and I never go outside of this comfort zone no matter how much I like a position. It is consistant with my overall trading strategies and it is what has kept my trading account growing year in and year out.
Back to Citigroup. Let’s just say the stock is at $10 by January 2010 and $20 by 2011.
You want numbers? The $700 you invested on the 7.50’s will be worth $7,500 (30 contracts x $2.50) because the stock is at $10 and the 2011 10’s would be worth $5 or $10,000 (20 contracts x $5) if Citigroup is at $15. So, your 2g’s is now worth $17,500.
That is how I’m approaching this trade from here on out. The risk is that this is all fluff and Citigroup’s numbers aren’t going to be as strong as many people feel they are going to be over the next few quarters.
Again, I like these call options and would “buy to open” today for a shot at having a huge payday in the future.
Update on MomentumOptionsTrading.com initial launch. Here are the introductory prices:
Monthly Recurring Subscription – $97 per month
Quarterly Subscription – $261 for 3 months. Save $30.
6-Month Subscription – $492 for 6 months. Save $90.
Annual Subscription – $924 for 12 months. Save $240.
Members Area:
Each week we will be introducing a new “Watch List” as a way to build and learn the different sectors of the market. The are dozens and dozens of sectors that have three or four stocks that really define their market. We show you how to follow them and create Watch Lists so that you will see where the money is flowing.
All of the current trades you see or that have been profiled will only be available in the Members Area.
We are expecting to launch by Monday but may do so over the weekend. Remember, we may limit the number of subscribers if the dmand is over subscribed.
Tags: Citigroup call options, Citigroup LEAP options, Momentum Option Trading, Momentum stocks
Posted in Financial Stocks, Option Trades, Rick's Account | No Comments »
Thursday, June 4th, 2009
10:00pm (EST)
I have a couple pieces of good news for everybody tonight. The first one is obvious as Dendreon (DNDN, $25.46, up $0.56) is the headline. The stock closed near its high for the day and I have been talking up Dendreon all week. In after-hours trading, the shares were up another 97 cents to $26.43.
As many of you know, I have been following this company for years which is why many of the Dendreon trades I have posted here in the blog have been successful.
That is what happens when you follow a company for years. You get to know and “feel” how a stock will trade. Of course, there is more to it than that but when you find stocks like this, they can make you money over and over again. You will even find yourself buying both call and put options once you learn how a stock trades.
Now, I can’t tell you exactly what is happening with Dendreon, news related because there is none, but it is on the verge of challenging its 52-week high of $27.40. However, I did tell you biotech has been lacking in the overall market gains and I also told you to watch for the break above $25.
I also wanted to talk more about the new trading service we have coming out. The first thing is that we will have a subscription link for all of you on Friday. Because we were a day late, in good faith, I sent out a Dendreon trade because I didn’t want to wait to make you profits. I also sent out another trade to all of you who emailed me on Tuesday and it was on Cisco Systems (CSCO, $19.67, up $0.31). I also threw in an Apple (AAPL, $143.74, up $2.79) trade and that stock was up another $2.51 in extended trading to $146.25.
I did this because I want you to see the incredible value we will be offering you and to show you I don’t hide any punches. I wanted to provide one last update on these trades because we will be going to a paid membership starting this weekend and I will not be covering these trades in the blog.
I’ve also been talking a lot about Apple since last week and how I thought the stock could challenge the $150 level. I mentioned the June 125 calls (APVFE, $19.15, up $2.55) on May 27th which were trading at $10.75 and they have nearly doubled. I also profiled the June 140 calls (APVFH, $6.67, up $1.47) last night and they opened at $4.75 this morning. They should double by Friday IF Apple’s after-hour gain holds. Either way, these positions should be closed on Friday, regardless if the stock breaks $150.
As an option trader it would be hard to leave a 100% position open over the weekend only to give back your gains come Monday. I’m not saying that is going to happen but the June options will expire in two weeks. If you wanted to keep a position on, you could close out the June call options and roll some profits into the July calls. However, I’m here to make you money and the smart money closes the trade and takes the profits on Friday.
The Dendreon July 30 calls (UQBGF, $0.90, up $0.10) opened at 87 cents and the August 30 calls (UQBHF, $1.56, up $0.21) opened at $1.50. This position is a little bit different than the Apple trade as we have plenty of time before these call options expire. And I don’t feel nervous about leaving these positions open.
In closing, I hope you have seen what an incredible value this service will be and I hope to have all of you on board when we launch next week. This will be the last chance to sign-up before the general public finds out which is when we may have to cap the number of subscribers. The special rates one last time are as follows:
1 month – $97
3 month – $261 or $87 per month (10% off)
6 month – $462 or $77 per month (20% off)
1 year – $804 or $67 per month (30% off)
Again, if you are interested in our new trading service send me an email with the subject title “3 month, 6 month, or 1 year” and I will put you on the list.
One more thing. If you DO NOT have an option account or if you are not approved for options trading LEVEL 2, please email me and I will help you with the process. In the subject line please type in “NEW ACCOUNT” or “LEVEL 2 HELP”. Even if you don’t have an option account, you can open one with no money. My point is I want to help you get started so when you do have money to start, you will be ready. I will be spending all weekend answering emails and adding any of you who read the blog that subscribe to the pre-order list we have.
Don’t forget, we get the unemployment report before the market opens. If we get any kind of good news, the market should continue its winning ways.
Rick Rouse
Rick@OptionsMentoring.com
Tags: Apple, Cisco Systems, Dendreon
Posted in Option Trades, Rick's Account | Comments Off
Wednesday, June 3rd, 2009
TiVo (TIVO, $10.70, up $3.32) shares hit a 52-week high today after a judge ruled that Dish Network (DISH, $15.56, down $1.68) and EchoStar (SATS, $16.12, down $0.25) will have to pony up nearly $200 million for “video-recorder” patent infringements. This was a windfall for TiVo as the company has lost money for two straight quarters.
After reporting a loss of $4 million, $0.04 a share, versus a profit of $3.5 million a year-ago, TiVo could be on track for more royalties. There is another $100 million in the kitty that could come TiVo’s way from “accumulated interest” for judgments three years ago. Keep an eye on these developments.
The June 10 calls (TUKFB, $1.20, up $1.15) were going for 5 cents yesterday and nearly 10,000 contracts traded hands today. That is a 2,800% gain for anyone who got in on Tuesday. I wouldn’t go chasing here, especially with the June calls but there may be a trade down the road. Speaking of:
A few words about the new trading service we are rolling out:
To start, I want to apologize to those of you who I haven’t emailed back (yet). Whenever someone emails me, I always try to respond within 24 hours. I pride myself on that. I don’t mind answering questions but this week has been hectic for me. Just remember, I do respond to all emails and I look forward to chatting with all of you in the future.
The new trading service is for everybody to enjoy and will offer directional and non-directional trades. Once you are a subscriber, you will get emails AND alerts (as needed) regarding new trades and current trades. This information will also be published in the members area which you will have exclusive access to.
I will give clear entry points, exit points, profit and loss targets for all trades. And at times I will enter trades. When I do, I will provide full disclosure. You have seen how I write trades up in the blog and the emails will be just like that. In other words, I won’t leave you hanging. You also know I talk about all of my trades, winners AND losers. I won’t be right all of the time but I won’t be scared to admit it either. My track record from the blog is 75% winners out of 250 trades.
Once you sign-up, any money you pay will go towards the purchase of any of the mentoring courses we have here. In other words, if you buy a year membership to the trading service for a 30% discount off the $97 monthly rate, that can be applied towards any of these mentoring courses at any time. So if you are with us for a few months and you want to get a course, the money that you have paid will go towards the purchase. You also get the classroom training twice a week so you can get a feel for things before buying the course.
We have an options course, a stock trading course, an e-mini course and this fall we will have a Forex course. Once you are a lifetime student, you will have access to all future videos and training classes for that course. However, you will not have access to the new trading service unless you are a subscriber. Some people just want the trade picks which is fine but our goal is to teach YOU how to find your own trades.
We started the trading service to make it easier for you to join our mentoring program. Instead of paying a one-time fee to join our program, we have spread it out in different payments to make it affordable for everyone. This way you can give us a try before choosing which course you want. It really is the best of both worlds.
If you are not interested in becoming a student, then we would still like to have you sign up for the trading service. My track record from the blog will be posted on the new site and you will see tons of triple-digit winning trades. You will also see trades that made some of you over 2,500%! Even if you just sign-up for a month, there’s a chance you can make back all of your money for the subscription and then some. And you get to use your subscription costs as a credit! Wow.
The last thing I want to talk about are some of the changes going on. The most important one is that John Ondercin is no longer with us. From my understanding, John offered “free” trade picks to his students. The “free” trades were part of his mentoring program and not ours. There is where some confusion comes in. Unfortunately, we cannot offer “free” picks.
In closing, I want to thank all of you who have been reading the blog. It has been a great pleasure to be able to talk and teach you about the market and that won’t change. In fact, the blog may even throw out a “free” trade every now and then. The Dendreon (DNDN, $24.90, up $0.83) trade was a “free” one and that stock moved from $4 to $24. I put a lot of you in the April, May, and August call options and many of you did very well.
There will be another Dendreon trade in the future and other exciting trades that I will profile. Many of you are scared to buy options because of the huge rally we have had. What you have to remember though, if there is a correction, there will be opportunities to buy put options which is the same thing on betting on a higher market. There is always a trade and that is what we want to teach you. For those of you reading this for the first time, here are the prices once again:
The rates are this.
1 month – $97
3 month – $261 or $87 per month (10% off)
6 month – $462 or $77 per month (20% off)
1 year – $804 or $67 per month (30% off)
If you are seriously interested in the service, please send me an email with “1 month”, “3 month”, “6 month” or “1 year” in the subject line. For those of you that already have emailed me, I should have the subscription link within the next 24 hours and I will email you back as soon as I get it. We will be up and rolling here soon and I thank you for your patience. I also encourage you to sign up fast so that you don’t miss what is happening with the current trades.
I am excited about this opportunity to finally be able to teach you the litttle tricks I have learned from trading options. Many of you have asked how I “find” trades and I will be showing you how in the future. There are so many things I have been wanting to talk about in the blog but couldn’t and I can’t wait to show you how to examine an option trade.
Rick Rouse
Rick@OptionsMentoring.com
Tags: Dish Network, EchoStar, options trading service, TiVo
Posted in Earnings, Hot Stocks, Market Analysis, Rick's Account, Sectors, Watch Lists | No Comments »
|
|
|  | | | |
Market Set To Open Higher
Wednesday, December 9th, 2009
9:00am (EST)
The market had a lousy Tuesday and it was one of them days where you just knew we were going to stay in the red. Futures were pointing towards a crummy open and the bulls did not do a good job of holding the Dow above 10,300. We have talked a lot about support and resistance levels lately and while they aren’t exact they help us stay focused.
The Dow finished the day with a 104 point loss to close at 10,285 but we aren’t THAT worried about…yet. The “zones” we have been going through still favor the bulls but we might get one foot ready for the back door if we fall below Dow 10,000. That being said, we still think a “blow the top off the roof” type rally could be in the cards.
The S&P 500 fell 11 points and closed at 1,091. We still have support at 1,067 but if that level fails it could crack the seal for further leakage. If the bathroom line is full and you’ve had a bunch of beers this is how 1,067 is going to feel for us…
From the “Where have you been department”:
Every now and then have we will find a stock that looks really good for a option trade and one of the first things we look for is volume. Most of you know we don’t buy stocks because they take too much capital and the returns from options simply dwarf the returns you get from stocks. Remember, a 5% move in a stock can mean a 100% return in the right option which is why we play the game.
If a stock has low “daily volume” then it means the options are probably thinly traded as well. When we do option trades we try to pick stocks that have a lot of volume because the bid and ask on the options are usually between 5-10 cents and the options are liquid. We also like to pick stocks that are volatile so that we can play them both ways. Call options on the way up, and put options on the way down.
One stock we were/ are bullish on is AthenaHealth (ATHN, $44.96, down $1.10) which hit a high of $47.75 last Friday. Here were our thoughts from July 20th (quotes from that day):
ATHN Could Challenge New High
AthenaHealth (ATHN, $38.03, up $1.64) could see some action as the healthcare reform bill is heating up. The options aren’t as liquid as other stocks…the August 40 calls (QJNHH, $1.55, up $0.55) have only traded 10 contracts.
The September 40 calls (QJNIH, $1.95, up $0.60) have traded about 50 contracts but because of the low volume we may crowd this trade if people start piling in. That could be a good thing as well.
AthenaHealth’s CEO, Jonathan Bush, has made the TV rounds and he is worth listening to. I love his insights on the HealthCare sector but the option pits just don’t have the volume. Let’s see where these things end up in a month or two but because of the low volume, I’m staying away. The stock might be the better buy if you are looking for some quick profits. The 52-week high is $39.29… (END)
Aeropostale (ARO, $31.06, up $0.86) got upgraded to “Buy” yesterday with a long-term price target of $45. The stock made it to a high of $31.50 and held its gains for most of the session. If the company would not have scared the BeJesus out of Wall Street when they announced earnings last week, the stock would be above $35 by now…
As we head to press, Dow futures are up 30 to 10,301 while the Nasdaq 100 futures are higher by 9 points to 1,777. The S&P futures are showing a 4 point gain to 1,094.
Although the market slid, we did pretty well with our trades yesterday. Current subscribers, check the Members Area for the current trade updates this morning.
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, Hot Stocks, Mergers and Acquisitions, Rick's Account, Strategies | Comments Off