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Friday, June 10th, 2011
9:00am (EST)
After 6-straight losing sessions, the bounce the bulls have been looking for finally occurred on Thursday. Despite not-so-impressive economic news, the market looked strong throughout much of the day as the bulls pushed support but the rally seemed to fade by the closing bell as the bears didn’t want things to get too far out of hand.
The Dow was up triple-digits intraday, to 12,183 (+135) and eventually settled with a gain of 75 points to finish at 12,124. We mentioned past support at 12,200 might keep a lid on the rally which is now resistance going into today’s action. There is further upside to 12,350 if cleared but it will be imperative the bulls hold 12,000 today if there is downside action.
The S&P added 9 points to finish at 1,289 after kissing a high of 1,294. The index will need to clear 1,295 and then 1,300 to get the momentum back on the bulls’ side. If yesterday’s gains fail to hold, there is risk is down to 1,275 and then 1,250.
The Nasdaq lagged but still ended the day nearly 10 points higher and closed at 2,684. Tech traded to a peak of 2,696.69 but never really challenged the 2,700 level which is where we said the bulls need to finish at this week. If they fail to string back-to-back winning sessions, there is downside pressure to 2,650-2,625 for today and next week.
We have some earnings we are going to profile today, one this morning and one this afternoon.
After the close last night, RealD (RLD, $24.67, up $0.80) surprised Wall Street (and us) by posting a profit versus expectations for a loss.
The company said it earned $4.5 million, or $0.08 a share, compared to a loss of $20.9 million, or $0.85 a share, in the year-ago period. Revenue came in at $58.5 million, up from of $55.4 million.
Analysts were looking for RealD to post a loss of $0.15 a share for the quarter on revenue of $52 million. Shares were up over $26 after the initial results were released minutes after the closing bell but fell once the company’s conference call got underway an hour later.
After questioning some of the “softer” 3D openings, the company’s CEO spooked analysts by saying 3D is still in the “early innings” and that film debuts would be “all over the place” when asked about box-office sales.
The stock finished last night’s extended session at $22.30, down $1.77. This morning shares are trading at $21-and change in pre-market action.
We would somewhat disagree that 3D is in the early stages because it’s been in the consumers face for a few years now. We aren’t sure when the novelty wears off but we would bet a $50 that it will once the cinemas try to increase ticket prices which are already insane.
Don’t get us wrong, we love the technology, and we have loved Imax (IMAX, $33.16, down $1.86) since we recommended the stock to our readers when shares were under $3. Now that the stock is up 1,000% and has been a solid 10-bagger since we brought you the story, we would close half and set tight stops at $30 on the other half just to be safe.
The bulls are once again behind the 8-ball this morning as futures are pointing towards a slightly lower open. Dow futures are down 39 points to 12,005 while the S&P futures are lower by 5 points to 1,277. Nasdaq futures are off by 6 points to 2,243.
We may be taking profits on one of our trades this morning which could DOUBLE once we open. Subscribers, check the Members Area for the trade updates.
Tags: call options, high beta stocks, Hot stocks, Imax, momentum options, Momentum stocks, option tips, options, options mentoring, options trading course, RLD, stock market options, weekly options
Posted in Earnings, Hot Stocks, Market Commentary | Comments Off
Friday, May 27th, 2011
12:40pm (EST)
The market is moving higher after getting better-than-expected economic news this morning. The first report came out before the bell as Personal Income rose 0.4% during the month of April which matched expectations while Personal spending rose 0.4% versus expectations for a 0.5% pop.
The final Consumer Sentiment Survey for May from the University of Michigan came in at 74.3, up from the 72.4 in April. On average, the suit-and-ties had expected the number to remain unchanged. One Negative Nancy, Pending Home Sales for April were fell 11.6% from the prior month versus a forecast for a decline of 1.4%.
The Dow started the week at 12,512 and is up 73 points to 12,475. A close above 12,500 would be bullish for next week.
The S&P began Monday’s session at 1,333 and is back to even with its 7 points gain. We would love to see a close above 1,335 heading into next week.
The Nasdaq was at 2,803 at the beginning of the week and is up 18 points to 2,800. This is the level we are looking for the bulls to seal the deal at and if the bulls win the week, Tech could lead the way higher next week.
We will be doing our monthly video with our next Weekly Wrap this weekend and we will be showing you all of the WEEKLY options that trade. These options are cheap, inexpensive ways to play the market’s volatile swings but you have to be right on the direction of the stock or an index in a way shorter amount of time, usually 5 days or less.
There are weekly options that are already listed for next week and out so you can use two or three week options if you want. There are only about 50 stocks that you can trade WEEKLY options on and we go over the list.
There is also a “safer” way of using these options by making them straddle or strangle trades. Although it lowers you chances of a greater return it also offsets the risks of playing options without insurance. We will cover a few of these trades as well in our video.
We are also going to show you some LEAP options on stocks that could be ripe for big moves down the road. We are going to show you how to position yourself 6 months to a year out so that you don’t have to worry about the daily swings of the market.
The Weekly Wrap is for our subscribers who like to buy stocks AND options. As option traders, it is hard to get away from the action because we want triple-digit profits, fast. But there are other ways to build wealth. And quickly, too.
For instance, we recommended Netflix (NFLX, $263.58, down $0.17) options in 2009 when the stock was at $55 and said then shares would easily be in the triple-digits. Or how about our ground-breaking coverage on Dendreon (DNDN, $42.25, up $0.34) when shares were under $5 a few years ago? At one point, the trade was a 10-bagger having reached nearly $50 a share. At current levels, Dendreon is on its way back to new highs.
We have also profiled shares of Imax (IMAX, $36.75, up $0.87) at under $3 and it, too, has become a 10-bagger in just a few short years.
We have also profiled dozens of other companies that have either doubled or tripled in price: Boston Beer (SAM, $83.80, up $1.53), Diamond Foods (DMND, $75.61, up $1.28), and SodaStream International (SODA, $57.59, up $1.08) are just a few other stocks we have profiled at much lower levels. All of our original articles can be archived by typing in the ticker symbol in our Search Box to the left on our website so you can see where we have been all over these names.
Our point is, this is one of the reasons we started the Weekly Wrap. Our goal is to find momentum stocks or ones that are stuck in trading ranges to use options with. This strategy can be powerful if played just right but you don’t want to be “called away” if shares are moving higher. Although your profits can become limited because you may have to sell your stock at a certain price even though it’s higher in the market, the premiums you receive also reduce your cost basis.
Of course, this requires a lot of chart work but that is why you have us. We told our subscribers to buy some of these stocks when they we in the single-digits but because we are an options newsletter we can’t officially count them as recommendations. By having the Weekly Wrap we can also take credit for our stock-picking gems and grow our subscribers’ portfolios in the same process.
We heard a story the other day where one fund manager has held Microsoft (MSFT, $24.76, up $0.09) shares for his clients for 10 years, yet, the stock has been dead money. The company has been under pressure to boot its CEO but he isn’t going anywhere anytime soon.
In the meantime, shares have been stuck between $20-$25 or $25-$30 for a decade and this fund manager could have been writing covered calls to juice his clients’ returns. If he had then he wouldn’t be taking heat.
We are running a deal through the end of the month that allows you to get our options trading manual, How to Trade Options on Momentum Stocks, at no charge by ordering a 1-year membership to our Weekly Wrap. You can read all about our training course and videos by clicking on the link above.
Our 2011 Weekly Wrap portfolio is off to a great start in our first official year of launching and we hope to have you on board for our new batch of winning trades over the next 6 months.
This offer won’t last long folks and we are running low on current copies. Once we reprint, there will be no more special deals. The option trading manual lists for $895, but again, it is included with your 1-year subscription to our Weekly Wrap which is cheaper. We have done this deal because we really want to make you a better trader. Most “options courses” sell for 5 times more but that is a lot of money that can be used for trading and we know that. This is why we are offering this special deal on one of the best courses out there on options.
We hope you will join us over the weekend and we will be back Sunday night (or Monday afternoon) with our Weekly Wrap and video update. The market is closed on Monday so enjoy the holiday. For those of you who just subscribe to the Daily, we will see you Tuesday morning. Have a great weekend everyone and get ready to trade next week! We have a feeling we are going to be active.
Special Note: Subscribers, we have a NEW TRADE for today to play next week’s possible bounce. Please check the Members Area now for the updates.
Tags: call options, DMND, dndn, high beta stocks, Hot stocks, Imax, momentum options, Momentum stocks, NFLX, option tips, options, options mentoring, options trading course, stock market options, weekly options
Posted in Market Analysis, Market Commentary, Weekly Wrap | Comments Off
Sunday, March 20th, 2011
8:45pm (EST)
1. Market Summary
2. General Electric – A Covered Call Play?
3. IMAX Corporation (IMAX) – Stuck in a Trading Range
4. Earnings
5. Weekly Wrap Portfolio Update
6. Week Ahead
= = = = = = = = = = = = = = =
1. Market Summary
To read more on where this market is headed and our latest thoughts on oil, the tensions in Libya, where General Electric (GE) is headed, and our comments on Imax (IMAX) click here.
Tags: call option, GE Stock quote, how to trade options, Imax, momentum options trading, Momentum stocks, NYSE: GE, NYSE: IMAX, option picks, option stock picks, options alerts, options newsletter, options track record, put option, volatile options
Posted in Weekly Wrap | Comments Off
Thursday, February 24th, 2011
9:00am (EST)
The world hates change, but it is the only thing that has brought progress – C. Kettering
Our Tuesday morning headline read “Market Faces Key Pivot Points” and we used this headline to try and keep everyone’s emotions in check.
If you recall, we had expected a market pullback during February expiration week but that changed when the S&P broke 1,325 on Friday, February 11.
To make a long story short, we were winding down trades that had been recommended since January and February (and in 2010) after a continued bull run that started in mid-September 2010.
From October to the end of 2010, we closed 13 out of 17 winning trades and we said in November that the uptrend or breakout could last until April. So far for 2011, we have closed 16 out of 18 winners. In other words, over the past 5 months we have recommended 29 out of 35 winners for an 80+% success rate. Some of our triple-digit winners have included gains of 141%, 170%, 114%, 182%, 150% (twice), 125% and plenty of high double-digit gains.
As we closed older positions, we started to plan our next “batch” of trades that have expiration dates in May, June, July and August because we are still bullish for the year but we are also eying downside opportunities as well.
It is hard enough to predict when market pullbacks can and will occur in bull markets but we have been using the charts to help take our emotions out of trading. In fact, when others were selling, we recommended call options because we knew our upper end targets were within reach. Although it is eerie how this has all played out, we did NOT factor in geopolitical events and charts can feel useless when there is volatility in the market.
The S&P 500 came within spitting distance of hitting 1,350 while the Nasdaq tugged on 2,850′s cape last Friday. The Dow actually traded thru our 12,350 target.
The market has obviously backed off these levels but this has been a “healthy” cleansing for the bulls that should refresh them if they plan to continue their run higher.
We recommended some protection from silver 3 weeks ago which hit a triple-digit return for us yesterday while we went longer-term on our other options trades. Investors seem to flock to gold and silver when the markets look like they are in trouble. Plus we told you the metals held their 200-day moving average and could be heading up back up when we recommended the trade.
On Monday night we prepared for the storm after seeing the futures weaken over the weekend and with the Libya turmoil heating up. We said support was at 12,200 and then 12,000 for the Dow “with multiple layers beneath”. The index touched a low of 12,063 yesterday before finishing at 12,105, down 107 points.
For the S&P 500 we said to watch for 1,325 and then 1,300 to hold. The index touched a low of 1,299.55 before closing at 1,307, down 8 ticks.
The Nasdaq touched a low of 2,705 on Wednesday which was just above our 2,700 support line. On Tuesday the index closed at 2,755 after we said 2,750 should hold. The index finished at 2,722 on Wednesday, down 33 points, and right in between our zone.
We don’t mention this to be a hot dog but to calm your fear of pullbacks during bull markets, or what to look for during a trend change.
We do, however, have to realize this could be a trend change but there are still several more layers of support the bears will have to crack for us to throw in the towel.
If the market does continue lower, then the next waves of support for the indexes are:
Dow 11,800; S&P 500 1,275; and Nasdaq 2,650. If these levels are breached and we end Friday on a weak note then the market really could be in trouble.
We have added a few put options that we profiled in our trading video from Monday night although they weren’t official trades of course. We showed our members how to play the market if it were to head lower and we showed them some March puts that have easily doubled since Tuesday’s open.
We don’t like to “day trade” options during a trend but we may have to if the volatility continues to pick up. This means there could be possible trading alerts outside our normal updates at 9am and 1pm.
Futures are pointing towards a lower open this morning but have come off their worst levels after a better jobless claims number: Dow (-18), S&P 500 (-4), Nasdaq 100 (-5). Subscribers, check the Members Area for the updates.
Tags: best option trader, best trading signals, call options, chicken trade, Covered Calls, financial options advice, Imax, momentum options, Momentum stocks, option mentoring, option quotes, option signals, Option Trades, option trading, options broker, options newsletter, options prices, put options, stock broker, stock price, stock quotes, strangle option trade, winning option trades
Posted in Market Analysis, Market Commentary | Comments Off
Wednesday, February 23rd, 2011
1:00pm (EST)
The bulls acted as if they wanted to take the market higher this morning but the bears are still a little hungry following yesterday’s big sell-off. Desert is always good after a big meal, if you have room, and that appears to be the case as the bears continue to push towards our near-term support targets.
The drift lower has accelerated and comes after a better-than-expected Existing Home Sales number. The National Association of Realtors reported sales of previously occupied homes rose slightly last month to a seasonally adjusted annual rate of 5.36 million. This represented nearly a 3% increase from 5.22 million in December but a lot of the action came from the foreclosure market which represented nearly 40% of sales in January. Wow. This shows a lot of people are sitting on cash as all-cash transactions accounted for over 30% of home sales. Normally, all-cash sales are about 10%.
As far as the geopolitical scene, Greece is seeing a little uprising today and Libya continues to play its wild card on oil. However, it is a weak card as the country only accounts for 2% of the world’s oil supply and can easily be covered.
Despite the chaos, we remain calm as we have a few trades that have done well on the slide. Other recommendations are longer-term options into April, May and July. We have expected this pullback and remember our thoughts from Monday morning.
Thursday is a big day for earnings so we could see some strength if earnings and forecasts come in above expectations:
Before the bell: Foster Wheeler (FWLT, $35.17, down $1.09), General Motors (GM, $35.34, down $0.43), Imax (IMAX, $27.15, down $0.30) and Safeway (SWY, $21.98, down $0.30).
After the bell: Applied Materials (AMAT, $15.82, up $0.16), DreamWorks Animation SKG (DWA, $28.28, up $0.28), First Solar (FSLR, $161.81, down $2.29), Gap (GPS, $22.41, down $0.29) and Salesforce.com (CRM, $133.64, down $3.11).
The bears are closing in on our downside targets so the close should be interesting and one we will be watching. Oil is nearing $100 a barrel which is also causing some concern and is weighing on the bulls. As we head to press, the Dow is lower by 90 points to 12,122 while the S&P is off by 11 points to 1,304. The Nasdaq is down 44 points to 2,712.
We are looking for Dow 12,000; S&P 1,300; and Nasdaq 2,700 to hold. Subscribers check for the updates in the Members Area. We are locking in profits on some trades by closing half positions and we have raised some stops on other positions that are profitable.
Tags: best option trader, best trading signals, call options, chicken trade, Covered Calls, financial options advice, fslr, GM earnings, Imax, momentum options, Momentum stocks, NASDAQ: CRM, option mentoring, option quotes, option signals, Option Trades, option trading, options broker, options newsletter, options prices, put options, stock broker, stock price, stock quotes, strangle option trade, winning option trades
Posted in Market Analysis, Market Commentary | Comments Off
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No Lucky Seven for Bears
Friday, June 10th, 2011
9:00am (EST)
After 6-straight losing sessions, the bounce the bulls have been looking for finally occurred on Thursday. Despite not-so-impressive economic news, the market looked strong throughout much of the day as the bulls pushed support but the rally seemed to fade by the closing bell as the bears didn’t want things to get too far out of hand.
The Dow was up triple-digits intraday, to 12,183 (+135) and eventually settled with a gain of 75 points to finish at 12,124. We mentioned past support at 12,200 might keep a lid on the rally which is now resistance going into today’s action. There is further upside to 12,350 if cleared but it will be imperative the bulls hold 12,000 today if there is downside action.
The S&P added 9 points to finish at 1,289 after kissing a high of 1,294. The index will need to clear 1,295 and then 1,300 to get the momentum back on the bulls’ side. If yesterday’s gains fail to hold, there is risk is down to 1,275 and then 1,250.
The Nasdaq lagged but still ended the day nearly 10 points higher and closed at 2,684. Tech traded to a peak of 2,696.69 but never really challenged the 2,700 level which is where we said the bulls need to finish at this week. If they fail to string back-to-back winning sessions, there is downside pressure to 2,650-2,625 for today and next week.
We have some earnings we are going to profile today, one this morning and one this afternoon.
After the close last night, RealD (RLD, $24.67, up $0.80) surprised Wall Street (and us) by posting a profit versus expectations for a loss.
The company said it earned $4.5 million, or $0.08 a share, compared to a loss of $20.9 million, or $0.85 a share, in the year-ago period. Revenue came in at $58.5 million, up from of $55.4 million.
Analysts were looking for RealD to post a loss of $0.15 a share for the quarter on revenue of $52 million. Shares were up over $26 after the initial results were released minutes after the closing bell but fell once the company’s conference call got underway an hour later.
After questioning some of the “softer” 3D openings, the company’s CEO spooked analysts by saying 3D is still in the “early innings” and that film debuts would be “all over the place” when asked about box-office sales.
The stock finished last night’s extended session at $22.30, down $1.77. This morning shares are trading at $21-and change in pre-market action.
We would somewhat disagree that 3D is in the early stages because it’s been in the consumers face for a few years now. We aren’t sure when the novelty wears off but we would bet a $50 that it will once the cinemas try to increase ticket prices which are already insane.
Don’t get us wrong, we love the technology, and we have loved Imax (IMAX, $33.16, down $1.86) since we recommended the stock to our readers when shares were under $3. Now that the stock is up 1,000% and has been a solid 10-bagger since we brought you the story, we would close half and set tight stops at $30 on the other half just to be safe.
The bulls are once again behind the 8-ball this morning as futures are pointing towards a slightly lower open. Dow futures are down 39 points to 12,005 while the S&P futures are lower by 5 points to 1,277. Nasdaq futures are off by 6 points to 2,243.
We may be taking profits on one of our trades this morning which could DOUBLE once we open. Subscribers, check the Members Area for the trade updates.
Tags: call options, high beta stocks, Hot stocks, Imax, momentum options, Momentum stocks, option tips, options, options mentoring, options trading course, RLD, stock market options, weekly options
Posted in Earnings, Hot Stocks, Market Commentary | Comments Off