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Tuesday, July 20th, 2010
1:00pm (EST)
Futures were already pointing towards a sharply lower open this morning after a number of “disappointing” earnings announcements, but the Dow is holding three fingers up as it struggles to stay afloat above the 10,000 level.
It’s been all about the revenue numbers, and we mentioned this as the one key element that could hold any rallies down or keep us in this tight trading range that seems to have lasted longer than unwanted company.
The Dow is currently down 86 points, or 0.9%, to 10,068 while the S&P 500 is down by 6 points, or 0.6%, to 1,065. The Nasdaq is getting hit the hardest but has bounced off its lows. The Tech-heavy index is down 22 points, or 1%, and was last seen at 2,176.
The key levels we were watching are 1,050 for the S&P and 10,000 for the Dow. And wouldn’t you know it. The Dow touched a low of 10,007 while the S&P 500 kissed 1,056. For the Nasdaq, we have been looking for 2,150 to hold and it has traded to a low of 2,159.
It’s sometimes scary to be so accurate, but this market has been in a trading range that feels like a bad tattoo for all to see. The bottom line is it has been predictable and a trading hell.
However, if these levels are taken out then we could see 9,800; 1,020, then 2,050, respectively, for the indexes.
The bulls have done a good job of bouncing off the lows but the test will come going into the close. The main event after the bell will be Apple’s (AAPL, $247.13, up $1.55) earnings, and it will likely be a market moving event in the morning. For the bulls’ sake, they better hope Apple can beat on revenues AND say something special in their conference call (a stock split?).
The company has routinely made stock-splits in the past but has been reluctant to do so during this barrage of new product introductions over the past 18 months. A 5-for-1 split would get shares back to $50 and more affordable for the small investor. It won’t change the company’s market cap so somebody tell Jobs to get on with it so we can trade options on the stock. We normally don’t trade options on triple-digit stocks because of the premiums. However, if Apple misses Wall Street’s estimates, then shares could easily sink 10%-15%.
We have some good updates for our subscribers in the Members Area so let’s get to it. We will be back at 9am in the morning with the news, and we can’t wait!
Tags: AAPL, Apple, Apple stock split, Apple's earnings, call options, how to trade options, momentum options trading, Momentum stocks, option picks, option stock picks, options alerts, options newsletter, options track record, put options, stock options trading, volatile options
Posted in Apple, Company Commentary, Earnings, Market Analysis, Market Commentary | Comments Off
Wednesday, June 23rd, 2010
1:05pm (EST)
The bulls got some more bad news this morning and after a positive start the market quickly reversed course after a terrible housing number derailed any momentum the bulls were trying to gather.
Sales of new homes fell off a cliff, tanking 33% to 300,000 last month as potential buyers put on the brakes after the government tax incentives expired. It was the worst number ever posted. Wall Street was expecting a number of 410,000.
As a result, the Dow quickly dropped to a low of 10,227, or 65 points, but has recovered somewhat as the index is currently down 19 points, or 0.2%, to 10,274.
The S&P is still having trouble with the 1,100 level and has traded to a high of 1,096 but is currently down 7 points to 1,088. The Nasdaq is off by 14 points and is at 2,247.
Adobe Systems (ADBE, $30.70, down $2.06) is down 7% despite reporting better-than-expected earnings. The company reported a profit of $149 million, or $0.28 a share, versus $126 million, or $0.24 a share, in the year earlier period. Revenue came in at $943 million versus Wall Street’s expectations of $906 million.
Adobe’s Flash technology has been banned by Apple (AAPL, $270.54, down $3.31) and is not used in the iPad or any other Apple devices. Flash is used for Web videos and other content but this did not seem to soften demand for Adobe’s latest products. However, don’t be surprised if Adobe continues to fall towards its 52-week low of $26.
It feels like the bulls are walking on eggshells. In about an hour or so we will get the Federal Reserve’s latest assessment of the economy. It is expected the central bank will keep interest rates at current levels following the conclusion of its two-day meeting.
The Fed wants to keep rates low to help with a recovery, but the numbers we are seeing from housing and jobs suggest there will be no change in the policy anytime soon.
Tags: AAPL, ADBE, Adobe Systems, Apple, momentum options trading, option picks, options alerts, stock options trading
Posted in Apple, Company Commentary, Market Analysis, Market Commentary | Comments Off
Monday, June 7th, 2010
1:10pm (EST)
The bulls tried to rally the market at the open but after a brief stay in positive territory the major indexes are mixed. The euro fell to a low of $1.188 before bouncing back to $1.192 which helped stabilize the overseas market but the trend is still bearish and isn’t going to change anytime soon.
We are watching the $1.180 level for the euro which is where the currency ended its first day of trading back in January 1999. The 10-year average for the euro against the dollar is $1.20 and we wouldn’t be surprised if $1.15 is taken out.
Biotech is making a lot of noise today with mixed results but we are watching shares of Dendreon (DNDN, $38.26, down $2.58) which are down 6% today. Investors seemed disappointed when the company’s CEO said they had no plans to partner with someone to produce Provenge faster. He said they have a few more plants coming on board to manufacture the drug and that they are the experts on Provenge with plenty of support to move the company forward.
Dendreon has spent nearly $1 billion over the past 15 years to bring Provenge to the market so they have a game plan in place. In fact, we can’t blame them for doing it their way and their pipeline could yield other cancer cures. If shares fall back to $32 then we would seriously think about actually buying the stock but there may also be a chance to buy some longer-term call options.
Apple (AAPL, $256.27, up $0.30) was trading lower but has turned around. The company is unveiling its 4G iPhone during its annual software developer’s conference in San Francisco today. There is a lot of chatter on what new features have been added and we are hearing a higher-resolution screen, improved battery life, a cooler camera and the ability to multitask.
 AAPL 15-minute chart The bad news from all of this is that AT&T (T, $24.58, up $0.41) has eliminated its unlimited monthly data plans for new users of the iPhone and iPad. If you haven’t been with AT&T then you will have to choose between two data plans with monthly usage limits and pay more for extra use. There has been talk that Apple will partner with other carriers so AT&T could be taking a big risk trying to squeeze out more revenue.
As we head to press, The Dow is trading higher by 20 points and is at 9,952 while the S&P 500 is up 2 to 1,067. The Nasdaq is showing a 7 point loss and was last seen at 2,211.
We have a lot to cover with our current trades and there are a few others on our Watch List that are making some nice moves today. Current subscribers, check the Members Area for the updates as we expect any rally to fade.
Tags: AAPL, Apple, AT&T, Dendreon, dndn, momentum options trading, option picks, options alerts, stock options trading, T
Posted in Apple, BioTech, Company Commentary | Comments Off
Thursday, May 27th, 2010
9:00am (EST)
The bulls put on a good show for much of yesterday’s session, but the lack of follow-through has been apparent for a few weeks now. Despite some robust economic news, the bears were able to erase all of the gains their counterparts had made and scored a huge win after the euro fell in late trading.
We mentioned yesterday in our 1pm update we didn’t think the rally would hold, and when word spread that China was reviewing its holdings of European bonds, well, things turned south. Folks, if China starts losing faith in the euro and starts selling some of its Euro bond holdings then we could see new lows for the currency which is already at a 4-year bottom.
As a result, the Dow gave back a triple-digit gain of 135 points to finish Wednesday at 9,974, a loss of 69 points, or 0.7%. The index had only closed below 10,000 once this year which was back on February 8th when it closed at 9,908. Since then, it has traded below that psychological level a number of times but has managed to close above it. Not yesterday.
The S&P 500 fell a half-dozen points, or 0.6%, to settle at 1,067 while the Nasdaq gave back 15 points, or 0.7%, to finish at 2,195. It was also the first time since mid-February that Tech has closed beneath the 2,200 level. This is the exact target we told you to watch for and yesterday’s close confirmed our beliefs that the Nasdaq will take out the 2,000 level.
On a positive note, we thought we would roll out the red carpet for Apple (AAPL, $244.11, down $1.11) this morning after the company passed Microsoft (MSFT, $25.01, down $1.06) as the #1 “Tech” company as far as market cap.
This is a rather important event, but even more glaring is the hidden message Microsoft’s stock price is telling us. Shares have folded like a cheap lawn chair since last week after basing in the $28-$31 area since mid-February. The next level of support for the stock is at $23 and if that is broken then Microsoft could be headed to $20.
Apollo Group (APOL, $53.40, down $1.66) and Moody’s (MCO, $20.88, down $0.36) are on the move this morning and were two recent trades that we recommended.
We took a 16% hit on Apollo after the parameters of the trade were broken but we have been warning our subscribers to stay away from this dog for years. Justice might not have been served on our recommended option trade, but the 52-week low of $52.20 looks like it will fall today.
We didn’t like the volatility when shares shot up to $60 last Thursday on some bogus rumor so we got our subscribers out. However, we should have listened to our gut as the stock looks poised to fall below $50 today.
Moody’s is another joke of a company that we have been all over like grass on dirt. Our subscribers took advantage of the commentary inside the Members Area and were able to turn a put option trade into an 80% winner. We were telling readers to take “half’ position profits in this choppy market, and we ran out of halves as we closed this trade last Tuesday. Shares are poised to sink below $20 this morning and we have said this stock was headed to the teens.
We have been talking about the “faded rallies,” and as we head to press this morning futures are showing a huge open. It’s a busy Thursday, but the Dow futures are up a whopping 154 points to 10,075 this morning which means we are going to have a HUGE open. The Dow futures were up over 200 points but gave a little back after jobless claims came in higher than expected.
We have loaded up our Watch List to take advantage of another faded rally this morning.
Tags: AAPL, APOL, Apollo Group, Apple, MCO, Microsoft, Moody's, MSFT, option picks, option signals, options alerts, stock options trading
Posted in Company Commentary, Market Analysis, Market Commentary | Comments Off
Wednesday, November 25th, 2009
9:00am (EST)
To quote a famous football coach of the Green Bay Packers back in the day…
“What the hell is going on around here?”…
We did a big write-up on A123 Systems (AONE, $17.09, up $2.56) yesterday at 12:45pm when the stock was at $14.75 and shortly after 1pm the stock started soaring. There was no specific news so we are not sure of why the shares surged 17% after we profiled the company.
We did NOT list any call options but if you looked up the stock quote shortly after our update then please email us and say you were able to get into the December 17.50 calls (ZKQLW, $0.95, up $0.80) at lower prices.
Folks, these call options OPENED at 20 cents and traded to a low of 15 cents before ZOOMING over 500% yesterday! The option activity was brisk as nearly 5,000 contracts traded hands. Incredible.
We wish we could take credit for the trade and maybe it was our loyal readers who started to take positions but again, we didn’t list these options as a trade. The only “catalyst” out there could be the news that U.S. electric sports car maker Tesla Motors plans to go public soon.
In any event, we were thisclose to hitting a homerun this week but keep an eye on these call options. We still don’t know where they will end up but consider it a free trade if it does well from here (sly grin). If the stock falls back to $14 then maybe we ”strangle” it with an option trade to capture the volatility for some nice profits.
We have been trying to catch A123 but the price action is hard to predict given the shares have only been trading for a few months. The company’s stock climbed to nearly $20 on the first day of trading (September 24th), a 45% increase from its IPO price of $14. Two weeks later, it made a high of $28.20.
These are the types of stocks we LOVE to trade but we have to be careful with the swings.
Breaking economic news…
Weekly Jobless claims dropped 35,000 for the week ending 11/21 to 466,000, October personal income was up 0.2% and personal spending was up 0.7%. One negative was the durable goods order which came in at -0.6%.
Futures were already higher before the rash of economic news and held up strong following the reports. Dow futures are currently up 63 points to 10,468 while the S&P 500 futures are up 7 to 1,110. Nasdaq 100 futures are up 10 1,796.
We do profile a NEW TRADE this morning and we like its potential for a double. The trade is a play on the housing sector. Current subscribers, please check the Members Area NOW for the trade updates as well…
Tags: A123 Systems, American International Group, Apple, momentum stock option trading, Moody’s, Netflix, option trading online, option trading picks, options mentoring, options newsletters, options track record, support and resistance levels, triple-digit option trades
Posted in Company Commentary, Hot Stocks, Market Analysis, Option Trades | Comments Off
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Will Apple (AAPL) Split After The Bell?
Tuesday, July 20th, 2010
1:00pm (EST)
Futures were already pointing towards a sharply lower open this morning after a number of “disappointing” earnings announcements, but the Dow is holding three fingers up as it struggles to stay afloat above the 10,000 level.
It’s been all about the revenue numbers, and we mentioned this as the one key element that could hold any rallies down or keep us in this tight trading range that seems to have lasted longer than unwanted company.
The Dow is currently down 86 points, or 0.9%, to 10,068 while the S&P 500 is down by 6 points, or 0.6%, to 1,065. The Nasdaq is getting hit the hardest but has bounced off its lows. The Tech-heavy index is down 22 points, or 1%, and was last seen at 2,176.
The key levels we were watching are 1,050 for the S&P and 10,000 for the Dow. And wouldn’t you know it. The Dow touched a low of 10,007 while the S&P 500 kissed 1,056. For the Nasdaq, we have been looking for 2,150 to hold and it has traded to a low of 2,159.
It’s sometimes scary to be so accurate, but this market has been in a trading range that feels like a bad tattoo for all to see. The bottom line is it has been predictable and a trading hell.
However, if these levels are taken out then we could see 9,800; 1,020, then 2,050, respectively, for the indexes.
The bulls have done a good job of bouncing off the lows but the test will come going into the close. The main event after the bell will be Apple’s (AAPL, $247.13, up $1.55) earnings, and it will likely be a market moving event in the morning. For the bulls’ sake, they better hope Apple can beat on revenues AND say something special in their conference call (a stock split?).
The company has routinely made stock-splits in the past but has been reluctant to do so during this barrage of new product introductions over the past 18 months. A 5-for-1 split would get shares back to $50 and more affordable for the small investor. It won’t change the company’s market cap so somebody tell Jobs to get on with it so we can trade options on the stock. We normally don’t trade options on triple-digit stocks because of the premiums. However, if Apple misses Wall Street’s estimates, then shares could easily sink 10%-15%.
We have some good updates for our subscribers in the Members Area so let’s get to it. We will be back at 9am in the morning with the news, and we can’t wait!
Tags: AAPL, Apple, Apple stock split, Apple's earnings, call options, how to trade options, momentum options trading, Momentum stocks, option picks, option stock picks, options alerts, options newsletter, options track record, put options, stock options trading, volatile options
Posted in Apple, Company Commentary, Earnings, Market Analysis, Market Commentary | Comments Off