|
|
|
|
|
 |
|
|
 |
Tuesday, May 10th, 2011
9:00am (EST)
The bulls passed a key test on Friday and Monday as they got wins on both days following yesterday’s pop. The market was flat for much of the morning session although commodities were rebounding following last week’s selloff. Oil, gold and silver all traded higher despite an early rally in the dollar which eventually closed lower for the day. There was a little activity in the M&A sector and Energy stocks were strong which provided enough leadership to keep the bears at bay.
Oil fell below $100 last week but rallied over 5% to close at $102.50 a barrel. Meanwhile, gas prices have hit $4 a gallon, on average in the U.S., and are approaching levels from a few years ago.
Gold had dropped below $1,500 last Friday but finished above this level at $1,503 an ounce. Silver surged 5% to close over $37 an ounce.
Nvidia (NVDA, $19.75, up $0.43) reached into its coffers and flashed $367 million in front of privately held Icera’s face to get a deal done. It was a great acquisition for the company as they may a bigger push into the 3G and 4G mobile market. The deal is expected to close within a month and should start to payoff in the back half of 2012.
Despite the lack of economic news and major earnings announcements, the Dow drifted higher to finish with a gain of 46 points to 12,684. The index traded to a high of 12,722 with Alcoa (AA, $17.53, up $0.38) leading the way with a 2% pop.
The S&P 500 added 6 points and closed at 1,346 but ran into the 1,350 roadblock once again. The index reached an intraday high of 1,349.44 and was just enough to keep the technical picture blurry for another day. We mentioned 1,350 as a key battle ground for the push back towards 1,375-1,400 or the breakdown to 1,325-1,300.
The Nasdaq managed a 15 point advance and settled at 2,843. We mentioned in our Monday morning update to watch for 2,850 which is exactly where the bulls backed off. Tech has shown some signs of breaking out but the bulls are having trouble with this area on their push to 3,000.
In M&A news this morning, Microsoft (MSFT, $25.83, down $0.04) has made a pitch to buy Skype for $8.5 billion in cash. It is the largest deal ever for Microsoft in its attempt to keep up with Apple and Google but we think they overpaid.
eBay (EBAY, $33.12, up $0.40) paid $2.6 billion for Skype back in 2005 and sold a majority of its stake for $1.9 billion in cash in a leveraged buyout. However, the company still owns 30% of Skype which it listed on its books for $620 million. With Microsoft’s bid, that stake has just ballooned to $2 billion which is pushing shares of eBay near its 52-week highs this morning.
Futures are pointing towards a strong start this morning. Dow futures are higher by 45 points; S&P futures are up 6 points; Nasdaq futures are up a dozen. Subscribers, check the Members Area for the trade updates.
Tags: AA, call options, eBay, high beta stocks, Hot stocks, momentum options, Momentum stocks, MSFT, NASDAQ: EBAY, NVDA, NYSE: AA, option tips, options trading course, Skype, stock market options, strangle option trades, weekly options
Posted in Hot Stocks, Market Commentary, Mergers and Acquisitions | Comments Off
Tuesday, April 12th, 2011
9:05am (EST)
Monday’s action followed last week’s script where the bulls started the session pushing resistance only to fade by the end of the day. The bears have slowly chipped away at support and yesterday’s action favored their camp, but they too, are lacking momentum despite having the headlines in their favor.
There was nervousness and excitement ahead of the start of earnings season as trading was choppy on reports Japan would have to raise their nuclear warning and on news that the International Monetary Fund (IMF) cut their estimates for U.S. economic growth.
The IMF waited until gas was nearly $4 a gallon but said that higher gas prices could slow the pace of the U.S. economy. Wall Street has been worried about the effects of higher oil and food costs on corporate profits so we expected to see a “sell the news” event once word got out.
The Dow did manage a 1 point gain to settle at 12,381 but traded to a high of 12,444. The blue-chips touched a low of 12,352 which has been solid support but a break below this level could lead to a test back down to 12,200-12,000 for the bears. Near-term resistance has been hard to clear at 12,500-12,600 for the bulls.
The S&P 500 slipped 4 points and closed at 1,324 which was slightly below our 1,325 downside target. There could be further weakness down to 1,300 while the bulls focus on getting back to 1,334 and above.
The Nasdaq fell 9 points to finish at 2,771 after falling to 2,760 in late day trading. Tech held 2,750 but we will be watching this level going forward. There is further risk down to 2,650 if broken while 2,800 remains near-term resistance.
Yesterday’s technical breakdown pushed both the S&P and Nasdaq below their respective 10-day moving averages. This was the first time since mid-March that both indexes failed their 10-day MA’s and bears watching.
Of course, the big news after the bell was Alcoa’s (AA, $17.77, down $0.15) first-quarter earnings which came in mixed. After an initial pop to $18-and change in after-hours trading, shares fell 3% after the company reported sales that came in below expectations.
The company earned $308 million, or $0.28 a share, versus a loss of $201 million, or $0.20 a share in the year ago quarter. Revenue rose over 20%, to $5.96 billion from $4.89 billion, helped by a 7% pop in aluminum prices.
Analysts were expecting profits of $0.27 a share on revenue of $6.08 billion.
Shares of Alcoa are trading at $16.98 in pre-market action, down 79 cents, or 4%.
As far as futures, they are pointing towards a lower open; Dow (-51) S&P 500 (-7), Nasdaq 100 (-10). Subscribers, check the Members Area for the updates.
Tags: AA, Alcoa's earnings, call option trades, chicken trades, momentum options, Momentum stocks, options trading course, put options, stock market options, stocks that trade weekly options, strangle option trades, weekly options
Posted in Earnings, Market Analysis | Comments Off
Friday, April 1st, 2011
1:35pm (EST)
Lots of good happenings today, folks.
We had a little trouble sleeping last night in anticipation of this morning’s nonfarm payrolls numbers. Futures were up overnight by about 0.2% and we had a pretty good feeling this morning that the bulls would push the tippy-top of resistance. The headlines for today’s unemployment report will be debated but we could care less. All we care about is price action and we said to stay long and strong.
The Dow is up 77 points to 12,396 and has kissed 12,416. The February and 52-week high is 12,423.
The S&P is higher by 9 points 1,335 while the Nasdaq is showing a 16 point pop and is at 2,797 but has touched 2,802.
The rally up to resistance is a strong indication the bulls will probably push our next set of targets for the market and we will go over them this weekend. We will also be doing a video for our course members who have purchased our trading manual, How to Trade Options on Momentum Stocks, either this weekend or next.
For those of you who have been in our “mentoring” program, these videos are designed to help you find your own option trades and to understand where the market could be headed over the short and long-term. We also cover possible trades, different option strategies and some chart work.
The start of 1Q earnings season is just around the corner and it is one of the best times to look for trades. Each week in our Weekly Wrap we highlight the companies that we think will move 5%-10% and we show you how to find call or put option trades to take advantage of the possible price swings in our videos.
Alcoa (AA, $17.57, down $0.09) will announce earnings on April 11 which ”officially” starts the season so we have all of next week to start getting ready for our trade setups. We currently have Alcoa on our Watch List as we feel shares could push $19-$20 on a good announcement.
The cost of our trading manual and video courses have been low because we wanted to give everyone the opportunity to get the options manual at an incredible price and for those of you who have supported us through the years. This weekend, the price is going up and we won’t be offering anymore deals as we start to promote the course more aggressively.
Currently, you can get our option course at no charge (shipping included) if you subscribe to a 1-year membership to our Weekly or Daily newsletter. Again, this will be our last weekend offering this promotion.
We are also going to cover WEEKLY options in our next video. We recommended our first trade with these types of options on Monday. We recommended the Potash (POT, $60.77, up $1.84) April 60 calls (POT110401C00060000, $0.71, up $0.50) at 33 cents and closed the trade yesterday for a small profit.
We were a little nervous that the $60 level would be tough to crack so we decided to get out of the trade and try again next week. As you can see, these options are up over 200% today and had traded down to 10 cents on Wednesday. Today they have traded up to 94 cents.
The reason we went with this trade and closed it yesterday is because it was part of our PLAN. Before we got into the trade we said to ourselves it would be a play on Mosaic’s (MOS, $81.13, up $2.38) earnings (which blew away Wall Street’s estimates yesterday). We thought Potash would easily break $60 if Mosaic popped 5%-10% but they didn’t. We also knew if Mosaic would have moved this much, Potash would have followed and we would have been out of the trade before Friday and the jobs report.
In any event, we blew it, to a degree, because we closed the trade a day early but the more important thing is that we followed our plan. However, there are over 50 stocks that trade Weekly options and we will cover that list in our video. You can bet we will hit a big trade like this one, soon.
We have a lot to cover in our Members Area, including a NEW TRADE, so we have to roll but we wanted to make you aware of our offer. We will be back Sunday night with the Weekly Wrap which has become a big hit with covered call investors. These trades are designed to make 5%-10% every month or two which adds up over a year.
Have a good weekend everyone and we expect the rally to continue into next week with new highs on the horizon.
Tags: AA, Alcoa Earnings, MOS, Mosaic, NYSE: AA, POT, Potash
Posted in Option Trades, Weekly Wrap | Comments Off
Tuesday, January 11th, 2011
9:00am (EST)
The market ended mixed on Monday as the bulls made an incredible effort to square things up with the bears but fell just short before the closing bell. Tech was strong and managed to finish in the green but the Dow and S&P 500 extended their losing streaks to three-straight sessions.
The Dow was looking at a triple-digit loss shortly after the open but gained some of it back to only finish down 37 points, to 11,637. The index traded to a low of 11,573 before bouncing back. We are still looking for the index to run towards 12,000 with support coming in at 11,500.
The S&P 500 slipped 2 points and settled at 1,269. We were looking for the index to hold 1,270 but support is strong at 1,250-1,260. We believe the index can still chase 3,000 but we are watching support at 1,250.
The Nasdaq was down over 20 points at one point but managed to close with a 4 point pop to settle 2,707. We were glad to see the index hold the 2,700 level but there is strong support at 2,550-2,500. We are still looking for the Nasdaq to test 3,000.
Turning to earnings, Alcoa (AA, $16.49, up $0.07) reported a profit of $258 million, or $0.24 a share, versus $277 million, or $0.28 a share in the year ago period. Revenue checked in at $5.65 billion, up from $5.4 billion a year ago. The suit-and-ties were looking for a profit of $0.19 a share on revenue of $5.7 billion.
We mentioned yesterday shares had surged nearly 20% over the last few weeks and this was a classic buy-the-rumor sell-the news event. Alcoa also gave a rosy outlook but there was some nervousness when they said they face some sales “headwinds” with China as the country tries to curb inflation.
Shares were down slightly last night in extended trading, falling $0.28, or 1.7%, to $16.21. There is strong support at $15 but Alcoa could bounce back today and challenge its 52-week high of $17.60, down the road, if $16 holds.
And who said stock picking was a lost art? Our option trades got a nice pop yesterday as Tech held strong. We have profiled quite a few “under-the-radar” stocks that have flourished but they are starting to get noticed. When a stock moves from $27 to $32 in a month or from $12 to $16+ in 6 weeks, they get noticed. Good for us we got our subscribers in before the crowd and while these stocks have gained 20%-25% the options have returned triple-digit profits using less capital.
This, folks, is the beauty of options.
As we head to press, futures are up: Dow futures (+57), S&P 500 (+7), Nasdaq 100 (+12). We have a lot to cover inside our Members Area so let’s go check the updates.
Tags: AA, call options, momentum options, Momentum stocks, NYSE: AA
Posted in Earnings, Market Analysis | Comments Off
Monday, January 10th, 2011
12:35pm (EST)
The market opened lower on the negative headlines from overseas, which we covered this morning, and the momentum to the downside was strong as the Dow headed towards a triple digit loss shortly after the bell. The index has traded to a low of 11,573 so it didn’t quite hit triple-figures.
We have bounced off the lows but some investors seem to be taking profits ahead of the earnings season which kicks off tonight. Alcoa’s (AA, $16.48, up $0.06) earnings report after the close today will “officially” be the start of 4Q earnings season and Wall Street is looking for a profit of $0.19 a share on revenue of $5.7 billion, on average. The consensus range is for Alcoa to earn $0.16-$0.30 on $5.5-$6.1 billion for revenue so there is a chance the company surprises or disappoints.
Alcoa has posted better-than-expected results for the past two quarters, beating both earnings and revenue estimates. The 52-week high is $17.60 and shares were strong all last week heading into today’s report. We pointed out in our latest video that the company would be announcing today and a call option trade would have worked well last week. For our trading manual, How to Trade Options on Momentum Stocks, we show you how to play earnings but we will probably sit Alcoa’s out. With a recent 20+% pop in the stock, we feel the easy money has already been made.
One group having a rough day is the Educational sector which is getting hammered after Strayer Education (STRA, $118.17, down $35.07) said winter enrollment is off by 20%. We have been warning you to stay away from this sector for years (unless you are shorting it), especially Apollo Group (APOL, $35.89, down $2.09) because of the shady shenanigans they use to enroll people. The entire sector is a joke and the hammer is about to fall as the sector’s debt begins to swell on unpaid student loans.
As we head to press, the Dow is down 44 points to 11,630 and we are looking for 11,600 to hold. There is further support at 11,500 but we doubt things get that crazy today.
The S&P 500 is off by 4 points to 1,267 and has traded to a low of 1,262. After breaking out past 1,250-1,260 last week, this zone should act as support.
The Nasdaq is showing a decline of 5 points to 2,698 and has dipped below 2,700. There is further support at 2,650 but Tech still looks strong.
We have a ton of information to cover this afternoon in our Members Area as one of our trades was stopped out. We had already closed half of the recommendation to protect profits but the other half continued to surge before falling back today. Still, we can’t complain. Our subscribers banked over 180% on the trade.
We will be back Tuesday morning with a full update.
Tags: AA, APOL, call options, momentum options, Momentum stocks, NASDAQ: APOL, NASDAQ: STRA, STRA
Posted in Earnings, Hot Stocks, Market Analysis | Comments Off
|
|
|  | | | |
Get RSS Feed
Microsoft (MSFT) Buys Skype, eBay (EBAY) Up
Tuesday, May 10th, 2011
9:00am (EST)
The bulls passed a key test on Friday and Monday as they got wins on both days following yesterday’s pop. The market was flat for much of the morning session although commodities were rebounding following last week’s selloff. Oil, gold and silver all traded higher despite an early rally in the dollar which eventually closed lower for the day. There was a little activity in the M&A sector and Energy stocks were strong which provided enough leadership to keep the bears at bay.
Oil fell below $100 last week but rallied over 5% to close at $102.50 a barrel. Meanwhile, gas prices have hit $4 a gallon, on average in the U.S., and are approaching levels from a few years ago.
Gold had dropped below $1,500 last Friday but finished above this level at $1,503 an ounce. Silver surged 5% to close over $37 an ounce.
Nvidia (NVDA, $19.75, up $0.43) reached into its coffers and flashed $367 million in front of privately held Icera’s face to get a deal done. It was a great acquisition for the company as they may a bigger push into the 3G and 4G mobile market. The deal is expected to close within a month and should start to payoff in the back half of 2012.
Despite the lack of economic news and major earnings announcements, the Dow drifted higher to finish with a gain of 46 points to 12,684. The index traded to a high of 12,722 with Alcoa (AA, $17.53, up $0.38) leading the way with a 2% pop.
The S&P 500 added 6 points and closed at 1,346 but ran into the 1,350 roadblock once again. The index reached an intraday high of 1,349.44 and was just enough to keep the technical picture blurry for another day. We mentioned 1,350 as a key battle ground for the push back towards 1,375-1,400 or the breakdown to 1,325-1,300.
The Nasdaq managed a 15 point advance and settled at 2,843. We mentioned in our Monday morning update to watch for 2,850 which is exactly where the bulls backed off. Tech has shown some signs of breaking out but the bulls are having trouble with this area on their push to 3,000.
In M&A news this morning, Microsoft (MSFT, $25.83, down $0.04) has made a pitch to buy Skype for $8.5 billion in cash. It is the largest deal ever for Microsoft in its attempt to keep up with Apple and Google but we think they overpaid.
eBay (EBAY, $33.12, up $0.40) paid $2.6 billion for Skype back in 2005 and sold a majority of its stake for $1.9 billion in cash in a leveraged buyout. However, the company still owns 30% of Skype which it listed on its books for $620 million. With Microsoft’s bid, that stake has just ballooned to $2 billion which is pushing shares of eBay near its 52-week highs this morning.
Futures are pointing towards a strong start this morning. Dow futures are higher by 45 points; S&P futures are up 6 points; Nasdaq futures are up a dozen. Subscribers, check the Members Area for the trade updates.
Tags: AA, call options, eBay, high beta stocks, Hot stocks, momentum options, Momentum stocks, MSFT, NASDAQ: EBAY, NVDA, NYSE: AA, option tips, options trading course, Skype, stock market options, strangle option trades, weekly options
Posted in Hot Stocks, Market Commentary, Mergers and Acquisitions | Comments Off