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Friday, August 31st, 2012
9:00am (EST)
The market closed right at support like we figured heading into today’s big event. We are pretty sure Ben Bernanke checked yesterday’s closes on the indexes so he is well aware what his carefully chosen words could mean for the market.
The Dow dropped 107 points, or 0.8%, to end at right at 13,000. The blue-chips traded in the red all session long and dipped to a low of 12,978. Today’s action could produce a 200-point swing on the Dow which would be the next wave of support for the bears (12,800) or a rebound back to resistance for the bulls (13,200).
The S&P 500 fell 11 points, or 0.8%, to settle at 1,399.48. The index traded to a low of 1,397 and could face a quick test to 1,375 on continued weakness after failing to hold the 1,400 level. The bulls could easily reclaim 1,410 or even 1,425 on bullish Bernanke comments.
The Nasdaq declined 32 points, or 1%, to finish at 3,048. Tech was unable to hold the 3,050 level and could test 3,025-3,000 on a continued pullback. A run back to 3,100 could be in the mix if the bulls get some good news.
The Russell 2000 closed at 808, down 9 points, or 1.1%, while the S&P Volatility Index ($VIX, 17.73, up 0.67) finished above 17.50.
Futures are showing a bullish open and look like this: Dow (+113); S&P 500 (+12); Nasdaq 100 (+27). Bernanke is no E.F. Hutton but everyone will be listening starting at 10am.
We have added several new possible trade candidates to our Watch List which could be opened once we get a good feel on what might happen. Subscribers, check the Members Area for the details and be on the lookout for New Trades or possible Trade Alerts if we need to take any action before our midday updateWe have added several new possible trade candidates to our Watch List which could be opened once we get a good feel on what might happen. Subscribers, check the Members Area for the details and be on the lookout for New Trades or possible Trade Alerts if we need to take any action before our midday update.
Tags: Bernanke Jackson Hole speech, best options newsletter, call options trading, VIX index
Posted in Market Analysis, Market Commentary, Sectors, VIX, Watch Lists | Comments Off
Wednesday, August 29th, 2012
12:10pm (EST)
It’s been another boring day on Wall Street but an exciting one for our portfolio. As the tight trading range continues, we will have to entertain ourselves with earnings and economic news until Big Ben speaks on Friday.
Joy Global (JOY, $50.78, down $2.29) is down 4% after reporting earnings that missed Wall Street’s expectations. The company reported a profit of $194 million, or $1.82 a share, on revenue of $1.39 billion. The suit-and-ties were looking for $1.88 a share on $1.42 billion in sales. The company also lowered its outlook for the rest of the year.
We talk about gold and silver from time to time and this month both metals have surged to possible new breakout levels. Gold did a great job in holding the $1,550 level all summer and has broken through its downtrend line from 2011 as it pushes $1,700 an ounce. This could be a false breakout but if support holds there could be a run to $1,800 coming. Watch the $1,650 level for a possible reversal signal and a move below $1,600 again would be bearish. Gold is currently down $11 to $1,658 an O.
Here is the chart for silver which has made a strong recovery off the $26 lows which has served as solid support. As you can see from the 2-tear chart, a move to $34 appears to be in the cards over the near-term but the pullback in February is also reminding us silver could be topping. Silver is currently down 15 cents to $30.73.
We have a lot more stuff to talk about but we are more interested in our option trades so we will leave it there for now.
The Dow is up 4 points to 13,107 while the S&P 500 is higher by a point to 1,410. The Nasdaq is lower by a half-point to 3,076.
Our subscribers locked-in huge profits this morning on our current WellPoint (WLP, $61.90, up $4.51) call option trade which is showing a gain of nearly 250%. We also have another trade that is pushing an 80% profit as well. Although we have targeted a 100% return for this blue-chip trade, we also want to lock-in HALF profits on our Caterpillar (CAT, $84.73, down $1.28) put options as shares have slipped below $85.
Subscribers, check the Members Area for the updates.
Tags: Gold prices, silver prices
Posted in Gold, Sectors | Comments Off
Wednesday, March 28th, 2012
9:00am (EST)
“Although this week is historically bearish, we could see some “window-dressing” by the fund managers which means they will be buying stocks early in the week. We still feel the market is close to peaking but we wouldn’t be surprised to see one last run at our near-term targets (Dow 13,500; S&P 1,425-1,450; Nasdaq 3,250; Russell 850) if there is a rush to buy this week.
We could also see a trading range this week before we get the surge in April which is typically one of the best months of the year for the market. Over the past decade, the indexes have gained 2%, on average, in April and if support holds this week, there is a good chance history repeats itself. However, we aren’t too bullish on 1Q earnings which will start to come in during the second week of April.” (3/25 Weekly Wrap and Monday morning outlook)
So far the market is following our road map for the week following Monday’s big surge. There was a little follow through on Tuesday as some of the large-cap stocks like International Business Machines (IBM, $207.18, down $0.59), Home Depot (HD, $50.04, down $0.09), Walt Disney (DIS, $44.15, down $0.23) hit new 52-week highs before pulling back as the follow through rally fizzled late in the day.
The Dow gained 44 points, or 0.3%, to close at 13,197. The blue-chips traded to a high of 13,265 but closed below the 13,200 level which is becoming the new favorite playground for the bulls and bears this week. Dow component, Pfizer (PFE, $22.50, up $0.34) managed to hit a new 52-week high of $22.80 but it wasn’t enough to keep the index out of the red.
The S&P 500 slipped 4 points, or 0.3%, to end at 1,412. The index traded to a high of 1,419 at the open, its loftiest level since May 2008, and fell just short of kissing our near-term target of 1,425.
The Nasdaq dipped 2 points, or 0.1% to settle at 3,120. Tech traded to a high of 3,134 late in the day but went out near its low by the closing bell. Apple (AAPL, $614.48, up $7.50) tried to keep the index in the green and did its part after setting a fresh all-time high of $616- and change. The Apple March 610 calls (AAPL120330C00610000, $7.75, up $2.65) opened at $4.65 before adding 50% for the day. It’s been years since we have played options on Apple but now that the stock trades WEEKLY options, we have found a cheaper way to play the stock.
Futures are favoring the bears this morning as we head to press and look like this: Dow (+35); S&P 500 (+4); Nasdaq (+8). Subscribers, check the Members Area for the updates as we have moved a couple of Hard Stops up to protect profits.
Tags: AAPL, hard stop, IBM, option hard stop, Walt Disney stock
Posted in Hot Stocks, Market Analysis, Sectors | Comments Off
Tuesday, November 29th, 2011
12:20pm (EST)
Most of you aren’t shocked by today’s headlines that AMR (AMR, $0.35, down $1.27), the parent company of American Airlines, has filed for Chapter 11 bankruptcy after blaming higher fuel costs and its failure to win a labor deal with its pilots. The company said it currently has assets of $25 billion while its liabilities are approaching $30 billion. With only $4 billion in cash, AMR felt it would be best to reorganize now and the Chapter 11 filing won’t affect flights during the bankruptcy process.
Airlines stocks have never been a great long-term investment, unless you short them, but there are times when you can trade them. The industry has never been able to flip a profit since being deregulated in the 1970’s so trade this sector with caution.
Although 3Q earnings season is winding down, there are still a few notable companies that will be reporting over the next few weeks. Tiffany & Company (TIF, $67.45, down $6.17) beat Wall Street’s estimates after reporting a profit of $90 million, or $0.70 a share, versus $55 million, or $0.43 a share, in the year earlier period. Revenue came in at $822 million. Analysts were expecting $0.61 a share on sales of $804 million.
Going forward, the company said it expects earnings of $1.48-$1.58 for the current quarter but the suit-and-ties were looking for $1.63, on average. Tiffany pointed the finger at Europe for the lowered expectations, which was no surprise, but either way, shares are down 8%.
As far as the market, the bulls are making continued progress after getting a better-than-expected Consumer Confidence number. The November reading of 56 was a big jump from October’s print of 40.9 and much higher than the forecast of 44. Elsewhere, the S&P Case Shiller Index fell 0.6% and missed expectations for no change.
The European markets are now closed for the day as the region’s top brass will meet behind closed doors tonight. They will be trying to come up with a better solution for their current debt crisis so the news over the next few days will be market moving.
The bulls have done a great job in pushing the indexes forward as they have broken through our near-term resistance targets.
The Dow is up 95 points to 11,617 while the S&P 500 is higher by 9 points to 1,202. The Nasdaq however, is struggling a bit and was last seen at 2,528, up a point.
We have 2 NEW TRADES we are releasing today that we are expecting to return 100%+ on each so we have to roll. Subscribers, check the Members Area for the updates and the new option recommendations.
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 Earnings, Economic News, Sectors | 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
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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
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Market at Support, Bernanke on Deck
Friday, August 31st, 2012
9:00am (EST)
The market closed right at support like we figured heading into today’s big event. We are pretty sure Ben Bernanke checked yesterday’s closes on the indexes so he is well aware what his carefully chosen words could mean for the market.
The Dow dropped 107 points, or 0.8%, to end at right at 13,000. The blue-chips traded in the red all session long and dipped to a low of 12,978. Today’s action could produce a 200-point swing on the Dow which would be the next wave of support for the bears (12,800) or a rebound back to resistance for the bulls (13,200).
The S&P 500 fell 11 points, or 0.8%, to settle at 1,399.48. The index traded to a low of 1,397 and could face a quick test to 1,375 on continued weakness after failing to hold the 1,400 level. The bulls could easily reclaim 1,410 or even 1,425 on bullish Bernanke comments.
The Nasdaq declined 32 points, or 1%, to finish at 3,048. Tech was unable to hold the 3,050 level and could test 3,025-3,000 on a continued pullback. A run back to 3,100 could be in the mix if the bulls get some good news.
The Russell 2000 closed at 808, down 9 points, or 1.1%, while the S&P Volatility Index ($VIX, 17.73, up 0.67) finished above 17.50.
Futures are showing a bullish open and look like this: Dow (+113); S&P 500 (+12); Nasdaq 100 (+27). Bernanke is no E.F. Hutton but everyone will be listening starting at 10am.
We have added several new possible trade candidates to our Watch List which could be opened once we get a good feel on what might happen. Subscribers, check the Members Area for the details and be on the lookout for New Trades or possible Trade Alerts if we need to take any action before our midday updateWe have added several new possible trade candidates to our Watch List which could be opened once we get a good feel on what might happen. Subscribers, check the Members Area for the details and be on the lookout for New Trades or possible Trade Alerts if we need to take any action before our midday update.
Tags: Bernanke Jackson Hole speech, best options newsletter, call options trading, VIX index
Posted in Market Analysis, Market Commentary, Sectors, VIX, Watch Lists | Comments Off