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Tuesday, April 6th, 2010
9:05am (EST)
The bulls pushed hard for Dow 11,000 on Monday and it sure looked like they had the momentum to get there.
After touching a new 18-month high of 10,988 early, the Dow took a breather before ending the day with a 47 point gain, or 0.4%, to settle at 10,973. The S&P 500 added 9 points, or 0.8%, to finish at 1,187 while the Nasdaq jumped 27 points, or 1.1%, and closed at 2,429.
There are few catalysts on the calendar that are likely to sway trading in the coming days as companies prepare to begin releasing first-quarter earnings next week. Alcoa (AA, $14.73, up $0.03) will officially kick-off Q1 earnings season next Tuesday.
The Federal Reserve will release the minutes from its recent interest rate-setting committee meeting today. We doubt there will be any surprises as the Fed kept its key rate at historic lows during the meeting to continue its easy money policy to help generate economic growth.
As far as specific stocks, watch TiVo (TIVO, $16.86, up $0.02) today. The 52-week high is $17.98 and shares are up to $17.70 in pre-market trading on no news.
Dendreon (DNDN, $38.19, up $1.17) set a new 52-week high yesterday and it appears the next stop will be $40. For those of you who have been with us awhile, many of you know the story as we have been covering this stock exclusively for the past few years. Check out our archives or type “Dendreon” in our search box on the website to read some of our past articles.
In fact, we were about the only newsletter who said Dendreon would be a blockbuster stock when it was under $5 a share a couple of years ago. Circle May 1, 2010 on your calendar. That is when the company expects its prostate cancer drug, Provenge, to gain FDA approval.
If so, this stock will easily see $50+.
As we head to press, futures are pointing towards a slightly lower open this morning. Dow futures are down 34 points to 10,875 while the S&P 500 futures are off by 5 to 1,177. The Nasdaq 100 futures are off by 6 and are at 1,967.
Our Members Area is packed full of recent trades and we have added several new plays to our Watch List. As we look to close out some trades and get into others, we still believe the trend is higher.
Tags: AA, Alcoa, Dendreon, dndn, option picks, option signals, options alerts, stock options trading, TiVo
Posted in Company Commentary, Earnings, Market Analysis | Comments Off
Monday, February 22nd, 2010
9:00am (EST)
Signs of a strengthening U.S. economy helped push the market sharply higher last week. The Dow, Nasdaq, and S&P 500 all posted its best weekly performance since early November after a string of strong earnings and economic reports helped the bulls regain momentum.
Ahead of the opening bell, Dow futures are up 31 points to 10,409. The S&P 500 futures are higher by 4 to 1,110, while Nasdaq 100 index futures are showing a 7 point pop and are at 1,826.
Here is a look at the today’s earnings calendar (quotes are from Friday’s close):
Monday: Autodesk (ADSK, $25.99, up $0.07), Campbell Soup (CPB, $33.93, up $0.08), Dominos Pizza (DPZ, $12.28, up $0.03), Dendreon (DNDN, $32.36, up $0.35), Fannie Mae (FNM, $1.02, flat), Healthcare Realty Trust (HR, $20.84, up $0.04), M&F Worldwide (MFW, $33.87, down $0.07), NetEase.com (NTES, $37.75, down $0.38), Nordstrom (JWN, $35.70, up $0.68), PrePaid Legal (PPD, $42.59, up $0.05) and Sears Holdings (SHLD, $95.04, up $0.64).
Dendreon is up to $33.20 in pre-market trading and has been on our Watch List for the past few weeks. We haven’t pulled the trigger on a trade just yet but it looks like the stock is entering a new bullish channel.
We do profile a NEW TRADE this morning. Current subscribers, check the Members Area for the updates.
Tags: Dendreon, dndn, option picks, option signals, options alerts, stock options trading
Posted in Company Commentary, Earnings | Comments Off
Thursday, January 7th, 2010
9:00am (EST)
It is amazing the price swings stocks and options can go through. The best part about being an option trader is that there is always a trade out there. With so many sectors and ways to use options, the possibilities are endless as sectors get hold or cold and investors rotate money around. That is all there is to it, folks.
The key of course is figuring out where the money is going before the rest of the crowd…
We knew the start of 2010 would be a make or break month for the market and after a big pop on Monday, we have been flat for two days. The Dow finished Wednesday with a 2 point gain and closed at 10,573 while the S&P 500 added 1 point to settle at 1,137. The Nasdaq finished with a 7 point decline and went to bed at 2,301.
Despite the “lack of action” in the overall market there are several stocks making new highs and interesting stories developing in others. We keep a lot of notes and sometimes we find trades that look good on paper but don’t start off quite the way we would like.
For instance, we profiled a U.S Steel (X, $60.40, up $2.47) option trade back on September 28, 2009 when the stock was at $46 and when of our first sentences were “There are conflicting reports on just how strong demand is for steel but August showed steel output actually increased.”
We were trying to get a jump on an option trade because we felt U.S. Steel would set new highs by January 2010. However, we knew the road would be rocky.
The trade was slightly profitable but we shut it down because of Goldman Sachs came out and downgraded the sector the very next day. U.S. Steel was pushing $47. Here is what we told our subscribers in our Members Area:
“Folks, we got bit by the Goldman Sachs whammy as they downgraded the steel sector on Monday. I did not see the news until late in the afternoon. It was just a few weeks ago Goldman loved U.S. Steel and had a price target of $50 for the stock which was hit last week several times. It seems although production was up like I had mentioned, prices are falling.
I am normally not this quick to pull the trigger on a trade but Goldman’s words carry weight and that could send the stock back under $45. As such, raise the stop and lower the exit target. We may not reach $3 and if you can get out with a small gain or break even, CLOSE the trade. If the call options get cheaper, we may revisit the story.” (END)
A week later the stock was at $40 so we made the right call by getting out of the trade. It got even worse for U.S. Steel as the stock dropped to a low of $33 by the first week of November.
At the time, we profiled the January 55 calls (XAK, $5.85, up $2.30) which were at $2.55 but soared a whopping 70% yesterday as the stock set a new 52-week high. The options were probably under 50 cents and left for dead back in November but as you can see, options can and do go on wild price swings over the life of their expiration.
Steel got hot, then cold, and now it’s white hot again. Wall Street will take us out of some great trades from time to time but if you know how the system works then you can use it to you advantage. By that we mean sectors are always falling in and out of favor with the Street and the analyst’s upgrades and downgrades do move them. Sometimes these ratings help your trades and sometimes they don’t. We may have missed a double on our option trade but it just proves our “thesis” was right on.
Another stock waking up from the dead is JDS Uniphase (JDSU, $8.92, up $0.43) which also set a 52-week high yesterday. The company makes communications equipment and testing instruments, as well as optical components for machines such as photocopiers and scanners.
Ten years ago this stock would hit hit triple-digits and split like clockwork. Well, we don’t think it will hit triple-digits anytime soon but we do see double-digits. We are looking at a possible option trade for JDSU this morning but we want to do some more research before jumping in.
We already have quite a few open trades in our 2010 portfolio that are doing well but we don’t want to lose sight of a possible good trade…
A couple of drug stock making some noise this morning…Vivus (VVUS, $9.23, down $0.09) is up nearly 7% in pre-market trading to $9.90 and Dendreon (DNDN, $29.41, up $1.27) is over $30 again.
Dendreon’s 52-week high is $30.42 which has been hit twice meaning the “double-top” that has formed over the past six-months could be broken. The stock has traded between $25-$30 since April, after exploding from $4, and is due another breakout.
We have been mentioning the drug candidates for Vivus and we said this stock could hit double-digits quickly based on its strong pipeline. That could happen today.
Retailers will also be on the move as retail sales came in better-than-expected.
As we head to press, Dow futures are lower by 22 points to 10,494. Current subscribers, check the Members Area for today’s important trade updates.
Tags: alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, chicken option trades, Covered Calls, Dendreon, financial, financial investment, funds, future option trading, futures trading, gold investing, guide to investment, guide to options, guide to options trading, hedge fund, hedge funds, how to invest, income, index funds, index options, invest, invest money, investing for dummies, investing market, investment, investment advisor, investment management, investment services, investment strategy, investments, JDS Uniphase, journal Wall Street, momentum stock option trading, mutual investing, new Wall Street, on Wall Street, online option trading, online trading system, option call, option exchange, option investment, option price, option selling, option trade, option trade picks, option trading online, options, options blog, options expiration, options mentoring, options newsletters, options track record, options trade, options trading, options trading strategies, private equity, put option trading, Rick Rouse, software options, stock, stock exchange, stock investment, stock market, stock market options, stock option trade pick service, stock option trading, stock price, stock quotes, stock share, stock trading, straddle option trades, strangle option trades, strategies options, support and resistance levels, the Wall Street, trading, trading option, trading options, triple-digit option trades, U.S. Steel, Vivus, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Hot Stocks, Market Analysis, Market Commentary, Oil, Option Trades, Sectors, Trading Tips | Comments Off
Monday, November 30th, 2009
1:00pm (EST)
It’s been another battle today as both bulls and bears struggle to gain momentum. The Dow opened with a slight loss and traded to a low of 10,273 before bouncing back and touching a high of 10,364. As Wall Street gets ready for the 2nd half of today’s action, the Dow is currently down 30 points to 10,280.
The market got a lift after the November Chicago PMI came in at 56.1, which was better than the 53 estimate that had been expected and is up from the 54.2 number we got last month. It looks like business activity in the U.S. Midwest is picking up.
As far as specific stocks we are following today…
Dendreon (DNDN, $27.33, up $0.09), which is frequently mentioned here at MomentumOptionsTrading.com, is getting a little bump today on rumors that AstraZeneca (AZN, $44.59, down $0.70) is looking at acquiring the company for $40 a share. We have been following this stock for nearly three years now and we have repeatedly said that we think Dendreon is a takeover candidate.
We have also mentioned the market potential of the company’s Provenge drug could be as high as $2.5 billion. The company will also host an Investor Conference on Tuesday from London. Hmmm…it’s too early to draw conclusions but the CEO himself has said they are looking to partner with someone overseas.
Other water-cooler talk we are hearing…Illumina (ILMN, $28.56, down $0.06) could be on Johnson & Johnson’s (JNJ, $62.57, down $0.32) list as an acquisition target. There are rumblings that JNJ could offer up to $38 a share for the company. Illumina has been a potential takeover target for months now and there are several firms on Wall Street who believe the same thing.
It looks like we missed the big move in American International Group (AIG, $29.30, down $4.00) this morning. We have a history with this company as well. In July, we profiled two bearish trades in AIG that made our subscribers 70% and 130%, respectively, on put options. We have been hesitant to go back to the well because of the volatility and the fact that the stock had been making new highs. In August the stock traded to a high of $55.
We had noticed the consolidation in the $35 area recently but today’s break below $30 has our attention. Today’s 12% drop in the shares have been a windfall for option traders. We think there could be further weakness and we take a look at some put options in the Members Area that are up a whopping 360% today!
Tags: American International Group, AstraZeneca, Dendreon, Illumina, momentum stock option trading, 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, Market Analysis, Trading Tips, Watch Lists | Comments Off
Monday, October 12th, 2009
12:40pm (EST)
The market is moving higher today as the Dow now stands 100 points away from 10,000. Currently, the index is up 37 to 9,901 and traded as high as 9,931 earlier this morning. Trading has been fairly light due to the Columbus Day holiday and the bond markets are closed. There are no major economic reports today so the bulls could make their run in the afternoon.
Exxon Mobil (XOM, $70.25, up $0.98) has busted through $70 and I had mentioned that we missed a trade when the stock traded to a low of $66 last Monday. I listed the November 70 calls (XOMKN, $1.85, up $0.35) outside of the Members Area because they were up 40% that day and I didn’t like the entry price of $1.50.
Since it was sort of a “Free Trade”, I thought I would expand my thoughts on the subject. There is resistance at $71-$72 for the stock and if you got in at $1.50, set stops there. If Exxon can muster up some momentum then shares have a shot at $73-$74 where further resistance comes into play. If the stock is at $73 by November 20th, the November 70′s are worth at least $3; at $74 they are worth $4…
One of our favorite Biotech’s is getting a pop today. It looks like Dendreon (DNDN, $29.38, up $1.90) could be on the move again. On the last day of August, we profiled a Dendreon trade that returned subscribers 100% in a little over two weeks. In March, Dendreon made the move from $5 to $25 and some subscribers made 10x that.
Dendreon will submit its application for Provenge to the FDA in November but today’s jump comes on news that the company added two new directors to its board.
One of them is chief executive of Roche’s Genentech unit and the other is a former Eli Lilly (LLY, $33.88, up $0.10) manufacturing executive. I don’t think we get in today but I’m looking at the option chain to see which ones could benefit the most if a buyout offer is coming…
Speaking of noise, Abercrombie & Fitch (ANF, $35.97, up $1.15) has continued its rebound and is setting up nice for us.
I will be back in the morning with the trade updates and possibly some new gems. Let’s hope the bulls continue to push.
Tags: Abercrombie & Fitch, Dendreon, Eli Lilly, Exxon Mobil, momentum trading, options blog, options mentoring, options track record, Roche
Posted in Company Commentary, Earnings, Hot Stocks, Market Analysis, Mergers and Acquisitions, Oil, Option Trades, Sectors, Strategies | Comments Off
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Futures point Towards Slow Start
Tuesday, April 6th, 2010
9:05am (EST)
The bulls pushed hard for Dow 11,000 on Monday and it sure looked like they had the momentum to get there.
After touching a new 18-month high of 10,988 early, the Dow took a breather before ending the day with a 47 point gain, or 0.4%, to settle at 10,973. The S&P 500 added 9 points, or 0.8%, to finish at 1,187 while the Nasdaq jumped 27 points, or 1.1%, and closed at 2,429.
There are few catalysts on the calendar that are likely to sway trading in the coming days as companies prepare to begin releasing first-quarter earnings next week. Alcoa (AA, $14.73, up $0.03) will officially kick-off Q1 earnings season next Tuesday.
The Federal Reserve will release the minutes from its recent interest rate-setting committee meeting today. We doubt there will be any surprises as the Fed kept its key rate at historic lows during the meeting to continue its easy money policy to help generate economic growth.
As far as specific stocks, watch TiVo (TIVO, $16.86, up $0.02) today. The 52-week high is $17.98 and shares are up to $17.70 in pre-market trading on no news.
Dendreon (DNDN, $38.19, up $1.17) set a new 52-week high yesterday and it appears the next stop will be $40. For those of you who have been with us awhile, many of you know the story as we have been covering this stock exclusively for the past few years. Check out our archives or type “Dendreon” in our search box on the website to read some of our past articles.
In fact, we were about the only newsletter who said Dendreon would be a blockbuster stock when it was under $5 a share a couple of years ago. Circle May 1, 2010 on your calendar. That is when the company expects its prostate cancer drug, Provenge, to gain FDA approval.
If so, this stock will easily see $50+.
As we head to press, futures are pointing towards a slightly lower open this morning. Dow futures are down 34 points to 10,875 while the S&P 500 futures are off by 5 to 1,177. The Nasdaq 100 futures are off by 6 and are at 1,967.
Our Members Area is packed full of recent trades and we have added several new plays to our Watch List. As we look to close out some trades and get into others, we still believe the trend is higher.
Tags: AA, Alcoa, Dendreon, dndn, option picks, option signals, options alerts, stock options trading, TiVo
Posted in Company Commentary, Earnings, Market Analysis | Comments Off