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Friday, March 23rd, 2012
1:25pm (EST)
The bears could get a big win this week if the current action holds of worsens as we head into the second half and last day of trading. The market continues to flash mixed signals as Tech is weak while the blue-chips are higher. We have seen a lot of “sector” rotation during the current bull market run and we would like to see one last surge to our near-term targets but it is hard to call at this point.
April is normally a “bullish” month for the market and even we are starting to feel like a top is in. The bulls have been awfully good to us for the past 4 months but at some point a pullback would be healthy. We could see a dip next week and then one last surge in April before we eventually get a 5%-10% correction and then again we might not.
We still have a slew of open call options but one of our triple-digit winners has been stopped out. We have closed our Clean Energy Fuels (CLNE, $22.75, down $0.52) call option trade for a 110% return after our Hard Stop was hit on the other half. We are 100% sure we will be back at some point in 2012 to trade this name again. We have also profiled the stock in our Weekly Wrap as a covered call trade that recently made our subscribers 27% as well.
We wrote a call option on Clean Energy Fuels back in November when shares were at $11.47 and we were “called-away” when shares closed at $14.03 in January. We were hoping shares would have stayed under the January 14 strike price we sold and when they didn’t, we decided to take the directional call option trade for our Daily newsletter that just made us triple-digits. The momentum in the stock was clear as day.
As you can see, there are numerous and safer way to use options to take advantage of long and short-term moves in a stock. Clean Energy recently hit a 52-week high of $24.75 on Wednesday and shares are simply filling in some gaps following the strong moves it has made.
As far as our other option trades, we have moved some Hard Stops up to lock in even bigger gains should the market retreat further. Again, we are expecting a choppy few weeks as the market figures out its next move and we are at the point where things could go either way.
The good news is we were able to close 2 more winning trades this week which brings our current 2012 Track Record to 54-11 which is an 83% winning percentage. Needless to say, we have been on a roll and you should come join us for the action (and profits!).
As we head to press, the Dow is up 44 points to 13,091 while the S&P is up 4 points to 1,397. The Nasdaq is lower by 3 points to 3,060.
Subscribers, check the Members Area for the updates and pay close attention to our hard stops as there are some adjustments.
We will be back Sunday night with our Weekly Wrap so until then, have a great weekend everyone!
Tags: call option trading, Clean Energy call options, CLNE, index options, strike price meaning
Posted in Hot Stocks, Market Commentary | Comments Off
Tuesday, January 19th, 2010
9:10am(EST)
Futures are mixed as we head towards the opening bell this morning. Dow futures are lower by 20, S&P 500 futures are off by 2 while the Nasdaq futures are up 4 points.
There was plenty of action in E*Trade Financial (ETFC, $1.84, up $0.11) last Friday as over 60 million shares traded hands. There was a report that the company is in “advanced” talks regarding a sale.
It’s hard to get excited about a company who once dominated the online brokerage industry and a share price at less than $2. From 1998 through 1999 this was one of the highest of flying stocks as two-for-one splits were common and shares made new highs daily.
There has been a lot of speculation as to who might buy the troubled brokerage firm but E*Trade has brand awareness which should account for some kind of premium. TD Ameritrade (AMTD, $18.32, up $0.10) and Charles Schwab (SCHW, $19.00, down $0.18) have been in the mix as possible acquirers of E*Trade but we really don’t see an option trade with this one.
Option volume was brisk and the stock already trades like one. However, we are avoiding options on stocks that trade under $5.00 because of the risk. That still didn’t stop traders from placing huge bets on the February 2 calls (EUSBF, $0.12, up $0.07) which opened at 4 cents and returned 200% by the closing bell. Over 10,000 contracts traded.
The April 2 calls (EUSDF, $0.20, up $0.05) traded 3,000 contracts after opening at 14 cents. Considering this has been an ongoing rumor for some time and the fact that it would be safer to buy the stock, these two call options could expire worthless if no bid comes. Stay away…
We have updated the Members Area for our current trades and there a few trades we are watching this morning. If we see something, we will send out an alert.
Tags: alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, Charles Schwab, chicken option trades, Covered Calls, E*Trade Financial buyout rumors, 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, 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 picks, option price, option selling, option trade, option trade picks, option trading online, options, options alerts, options blog, options expiration, options mentoring, options newsletters, options signals, 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, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Market Analysis, Market Commentary | Comments Off
Monday, January 18th, 2010
8:00pm (EST)
It was a tough Friday for the bulls as the market suffered its worst decline for 2010 despite some solid earnings reports.
The Dow fell 100 points for the day, erasing all of its gains for the week to close at 10,609. The index reached a high of 10,767 and came thisclose to hitting our target of 10,800 which we set in August 2009. For the week, the Dow lost 9 points…
The Nasdaq fell 1.2%, or 29 points, to close at 2,288. The index had already blown past our target of 2,275, and for the week, the Tech-heavy index fell 30 points after touching a high of 2,326.
The S&P 500 fell 12 points, or 1.1%, and settled at 1,136. We had set a target of 1,175 in August and the index reached a high of 1,150 this past week.
Folks, we mention all of this for a reason (not to toot the horn) because it defines some of our trading strategies. We have done well for our subscribers with the bull market rally that started in March 2009 and at some point the market will correct. It may be 5%, 10%, or even 20% but no one knows when that will be. When that happens there will be a time to buy put options and we saw some things on Friday that has made us cautious but it will take more than a 100 point drop to get any real “fear” in the bulls.
We knew coming into the week there was the possibility of the market heading higher and we where there heading into Friday. The two companies that we were counting on to take us past our target levels were Intel (INTC, $20.80, down $0.68) and JPMorgan Chase (JPM, $43.68, down $1.01).
Both companies reported incredible earnings…Intel posted its highest gross profit margins ever, at 65% and JPMorgan earned a $3.3 billion profit in its latest quarter. The fact that these two market heavyweights blew past Wall Street’s numbers and we could not get a nice rally was very discouraging for the most part.
We still think there’s a chance of a decent pop over the next few weeks as the heart of earnings season will get underway starting on Tuesday but a lot will depend on this week’s action.
Here is a look at the earnings calendar (quotes are from Friday’s close):
Tuesday: (Before the bell) Citigroup (C, $3.42, down $0.09), Fastenal (FAST, $45.86, down $0.44), Parker Hannifin (PH, $58.56, down $0.23), Precision Castparts (PCP, $113.75, down $1.59), TD Ameritrade Holding (AMTD, $18.32, up $0.10).
(After the bell) Cree (CREE, $54.01, down $3.84), CSX (CSX, $50.04, down $0.51), International Business Machines (IBM, $131.78, down $0.53), NuVasive (NUVA, $30.68, down $0.28), Tessco Technologies (TESS, $17.51, up $0.25).
Wednesday: (Before the bell) Bank of America (BAC, $16.26, down $0.56), Brinker International (EAT, $15.18, down $0.27), Coach (COH, $36.79, down $0.71), Jefferies Group (JEF, $25.48, down $0.34), M&T Bank (MTB, $73.16, down $2.18), Manpower (MAN, $57.06, down $1.88), U.S. Bancorp (USB, $24.62, down $0.71), Wells Fargo (WFC, $28.08, down $0.91).
(After the bell) Dr Reddy’s Laboratories (RDY, $26.98, down $0.14), eBay (EBAY, $22.47, down $0.41), F5 Networks (FFIV, $51.39, down $0.75), Kinder Morgan Energy Partners (KMP, $63.45, down $0.38), Seagate Technology (STX, $17.77, down $0.57), Starbucks (SBUX, $23.27, down $0.28).
Thursday: (Before the bell) Charles Schwab (SCHW, $19.00, down $0.18), Fairchild Semiconductor (FCS, $8.77, down $0.45), Freeport McMoRan Copper & Gold (FCX, $84.30, down $0.78), Goldman Sachs (GS, $165.21, down $3.32), Morgan Stanley (MS, $30.38, down $0.82), PNC Financial Services Group (PNC, $56.68, down $1.16), Southwest Airlines (LUV, $11.28, down $0.18), United HealthGroup (UNH, $33.75, up $0.43), Xerox (XRX, $8.84, down $0.05).
(After the bell) Capital One Financial (COF, $41.13, down $0.54), Deckers Outdoor (DECK, $108.72, down $0.37), Google (GOOG, $580.00, down $9.85), Intuitive Surgical (ISRG, $308.58, up $0.58).
Friday: BB&T (BBT, $27.76, down $0.76), Exelon (EXC, $48.60, down $48.60, down $0.48), General Electric (GE, $16.44, down $0.26), Harley-Davidson (HOG, $25.08, down $0.65), Johnson Controls (JCI, $29.31, down $0.53), Kimerbly-Clark (KMB, $62.22, down $0.80), McDonalds (MCD, $62.28, down $0.37), Schlumberger (SLB, $70.83, down $0.46).
As you can see, some of the bigger names will be eBay, IBM, General Electric, Goldman, Google and the Financial stocks. It is hard to say how the financials will trade over the near-term as Obama is trying to get as much as $120 billion from them as a fee or tax.
Economic news: Building Permits, PPI, and Housing Starts on Wednesday and Crude Inventories; Thursday Wall Street gets numbers on Initial Claims, Leading Indicators, and the Philly Fed.
We will be back in the morning with the trade updates and a fresh outlook. We have updated the 2010 portfolio in the Members Area and hope to have a short video that will be ready on Tuesday as well.
As we head to press, Dow futures are up 32, Nasdaq futures are higher by 10 while the S&P 500 futures are getting a 4 point bump.
Tags: alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, chicken option trades, Covered Calls, financial investment, funds, future option trading, futures trading, gold investing, hedge fund, hedge funds, how to invest, index funds, index options, invest, investing for dummies, investing market, investment, investment advisor, investment management, investment services, investment strategy, investments, 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 picks, option price, option selling, option trade, option trade picks, option trading online, options, options alerts, options blog, options expiration, options mentoring, options newsletters, options signals, 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, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Earnings, Economic News, Financial Stocks, Market Analysis, Market Commentary, Weekly Wrap | Comments Off
Friday, January 15th, 2010
9:00am (EST)
Intel (INTC, $21.48, up $0.52) blew past Wall Street’s forecast after the bell yesterday and reported some impressive numbers.
The company said it earned a profit of $2.3 billion, or $0.40/ share versus $234 million, or $0.04, in the year earlier period. Revenue climbed nearly 30% to $10.6 billion as Intel posted its highest gross profit margins ever, at 65%. Amazing.
The market finished higher on Thursday as the Dow closed with a 30 point gain at 10,710. The S&P 500 added 3 points and settled at 1,148 while the Nasdaq edged up 9 to 2,310.
For those of you who have been following us since the summer, we set targets for the market back in August that are about to be hit. Last Sunday we had this to say:
“The Dow added 11 points on Friday and 190 for the week to close at 10,618. Our near-term target remains 10,800 and this could be the week we take it down.
The S&P 500 gained 3 points to close at 1,145 and for the week the index added 30. In August, we set our target at 1,175 so we are within spitting distance…
As far as the Nasdaq, we clearly saw the strength in Tech back in the summer and set a year-end 2009 target of 2,275 for the index. That level was taken out before Christmas. On Friday, the Nasdaq displayed its muscle once again and had the biggest percentage gain as it added 17 points to close at 2,317.
We remain bullish and our portfolio has consisted of mainly call options since March 2009. We have added put options as “insurance” along the way but we still feel like the market moves higher from here. Of course, once our targets are hit that could all change but the beauty of getting a pulse on the market is that it allows you to change accordingly.
If and when we reach those aforementioned targets, we either, continue higher, stay flat, or retreat to lower levels. The cards to figuring out the next six months on where the market could be headed are being dealt right now. A lot of investors and traders will be ready to pay the ”big blind” this week as 4Q corporate earnings start to come in. We will go over this more on Monday morning.” (END)
Folks, it is important to know where the market is headed because once it gets in a groove, trading becomes easier. If and when we reach Dow 10,800 and 1,175 for the S&P we honestly don’t know what happens next. However, our gut is telling us the market continues higher but we have to wait for the clues to confirm our thesis.
Nobody knows what the market will do from day-to-day but overall the information is out there. There are times when trading options can get choppy but they key is not to “over trade” your accounts.
We talk about this in our Welcome Guide which is at the top of the Members Area page. Obviously, everyone wants to score the big trade but this gig is like all others…you have to grind it out. And you can’t blow up a $2,000 account by buying 10 or 20 contracts with your first trade. Try limiting your portfolio to 3%-5% per trade. In other words, if you buy 10 contracts for each of our trades then you should have a $20,000 account. If you have $10,000 then trade 5 contracts.
Our trades target $500-$2,000 if you are doing 10 contracts as we profile options anywhere from 50 cents to $2.00. Obviously, if you are new to trading or you are starting small then go slow and paper trade with us for a while. And remember, any money you trade options with should be considered “aggressive” and this type of trading is not for everyone.
Options are the most lucrative way to grow a trading account and remember everyone’s results will be different based on your own expectations and risk levels. Also, you will have winning and losing streaks but the goal is to make a 100% return on each trade. This allows you the luxury of having 2 losing trades at 50% if all things are equal. They key is to hit the 400%, 800% and 2,000% trades which we have.
Our documented track records show we have over a 70% winning percentage for the past couple of years so keep this in mind if you join us for a month and start off with a negative trade. For 2010 our track record shows we have closed trades for gains of 13%, 90%, 119%, and 150%. We still have open trades and once we get a few more closed we will start posting the 2010 track record at the end of the month.
This week has been pretty volatile due to options expiration and today is not historically a good one for the Dow. The index has traded lower on 9 of the last 11 January option cycles with some major hits of 1%-2% lower.
As we head to press, Dow futures are down 25; S&P 500 futures are lower by 4; Nasdaq futures down 4.5.
Tags: alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, chicken option trades, Covered Calls, financial investment, funds, future option trading, futures trading, gold investing, hedge fund, hedge funds, how to invest, index funds, index options, invest, investing for dummies, investing market, investment, investment advisor, investment management, investment services, investment strategy, investments, 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 picks, option price, option selling, option trade, option trade picks, option trading online, options, options alerts, options blog, options expiration, options mentoring, options newsletters, options signals, 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, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Earnings, Market Analysis, Market Commentary, Money Management, Stock Earnings, Strategies, Trading Psychology, Trading Tips | Comments Off
Thursday, January 14th, 2010
1:45pm (EST)
All eyes will be on Intel (INTC, $21.30, up $0.34) after the bell. Wall Street expects $0.30 a share and revenue is expected to rise to $10.2 billion from $8.2 billion last year.
Economic News…For retail sales, Wall Street was expecting an increase of 0.5%, weaker than November’s 1.3% increase. We came in worse than expected…retail sales for December decreased 0.3%.
For weekly jobless claims, Wall Street had penciled 430,000 new claims, off slightly from last week’s 434,000. We totaled 444,000. The latest tally marked a week-over-week increase of 10,000. Meanwhile, continuing claims retreated to 4.6 million from an upwardly revised 4.8 million.
As we head to press, the Dow is up 21 points to 10,702. As far as our current trades, they have been updated in the Members Area. We will be back in the morning with a full update.
Tags: alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, chicken option trades, Covered Calls, 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, 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 picks, option price, option selling, option trade, option trade picks, option trading online, options, options alerts, options blog, options expiration, options mentoring, options newsletters, options signals, 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, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Earnings, Economic News | Comments Off
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Market Mixed Following Bearish Week
Friday, March 23rd, 2012
1:25pm (EST)
The bears could get a big win this week if the current action holds of worsens as we head into the second half and last day of trading. The market continues to flash mixed signals as Tech is weak while the blue-chips are higher. We have seen a lot of “sector” rotation during the current bull market run and we would like to see one last surge to our near-term targets but it is hard to call at this point.
April is normally a “bullish” month for the market and even we are starting to feel like a top is in. The bulls have been awfully good to us for the past 4 months but at some point a pullback would be healthy. We could see a dip next week and then one last surge in April before we eventually get a 5%-10% correction and then again we might not.
We still have a slew of open call options but one of our triple-digit winners has been stopped out. We have closed our Clean Energy Fuels (CLNE, $22.75, down $0.52) call option trade for a 110% return after our Hard Stop was hit on the other half. We are 100% sure we will be back at some point in 2012 to trade this name again. We have also profiled the stock in our Weekly Wrap as a covered call trade that recently made our subscribers 27% as well.
We wrote a call option on Clean Energy Fuels back in November when shares were at $11.47 and we were “called-away” when shares closed at $14.03 in January. We were hoping shares would have stayed under the January 14 strike price we sold and when they didn’t, we decided to take the directional call option trade for our Daily newsletter that just made us triple-digits. The momentum in the stock was clear as day.
As you can see, there are numerous and safer way to use options to take advantage of long and short-term moves in a stock. Clean Energy recently hit a 52-week high of $24.75 on Wednesday and shares are simply filling in some gaps following the strong moves it has made.
As far as our other option trades, we have moved some Hard Stops up to lock in even bigger gains should the market retreat further. Again, we are expecting a choppy few weeks as the market figures out its next move and we are at the point where things could go either way.
The good news is we were able to close 2 more winning trades this week which brings our current 2012 Track Record to 54-11 which is an 83% winning percentage. Needless to say, we have been on a roll and you should come join us for the action (and profits!).
As we head to press, the Dow is up 44 points to 13,091 while the S&P is up 4 points to 1,397. The Nasdaq is lower by 3 points to 3,060.
Subscribers, check the Members Area for the updates and pay close attention to our hard stops as there are some adjustments.
We will be back Sunday night with our Weekly Wrap so until then, have a great weekend everyone!
Tags: call option trading, Clean Energy call options, CLNE, index options, strike price meaning
Posted in Hot Stocks, Market Commentary | Comments Off