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Wednesday, April 20th, 2011
8:50am (EST)
The bulls recovered from Monday’s haymaker and rebounded to push the market higher on Tuesday. Believe it or not, there were a couple of decent housing reports released before the bell which helped futures firm up and led to a solid open. The bulls cruised until halftime which is when the bears showed up but their stay was brief as the bulls powered forward and pushed the market to new highs before the close.
The Dow added 65 points, or 0.5%, to finish at 12,266 while the S&P gained 7 points, or 0.6%, and ended at 1,312. The Nasdaq popped nearly 10 points, or 0.3%, and settled at 2,744.
There was a lot riding on last night’s and this morning’s earnings so let’s cover some of the highlights:
Yahoo (YHOO, $16.12, down $0.22), Intel (INTC, $19.86, up $0.24), Juniper Networks (JNPR, $38.47, up $0.21) and Wynn Resorts (WYNN, $138.93, down $1.57) beat estimates after Tuesday’s close. It was good to see some of the old Tech leaders come in with solid reports and all 4 stocks are up in pre-market action.
We have been following Wynn Resorts for a few weeks now as shares continue to set new 52-week highs and we like the company’s recent deal with PokerStars.com. Our wonderful government shut down U.S. online poker sites on Friday, but we think there is too much money to be made for it not to be legal.
Wynn will be a major player and teamed up with PokerStars to push legislation forward but this was obviously a blow to the hundreds of thousands of Americans who have their money locked up in online poker accounts. For years these sites have said it was legal to play and have allowed deposits but Uncle Sam wants his piece of the pie too.
This litigation will take months (or longer) to resolve but we like Wynn for its long-term prospects as well. They are our favorite when it comes to Casino stocks but playing options on Wynn can be expensive. We recently profiled some September call options on Wynn inside our Members Area but we missed the trade because we were hoping to get better prices. Instead, we didn’t get our entry price and the options have nearly doubled.
Elsewhere, Cree (CREE, $40.81, down $0.26) shares were down 6% in after-hours last night and touched a low of $38.10. The company reported quarterly profits fell nearly 60% to $18.9 million, or $0.17 a share, down from $44.6 million, or $0.41 a share, in the year period.
Excluding items, Cree would have earned $0.27 a share while Wall Street had penciled in $0.30 a share. Revenue came in at $219 million versus last year’s figure of $234 million, and also below the $221 million the suit-and-ties had penciled in.
Futures are pointing towards a massive rally at the open. Dow futures are up 148 points to 12,374 while the S&P 500 futures are higher by 18 points to 1,327. Nasdaq futures are advancing 30 points to 2,341.
We have a lot to cover in our Members Area so let’s get to it.
Tags: call options, CREE, high beta stocks, Hot stocks, INTC, JNPR, momentum options, Momentum stocks, option tips, options trading course, stock market options, strangle option trades, weekly options, WYNN, YHOO
Posted in Earnings, Hot Stocks | Comments Off
Friday, January 14th, 2011
8:50am (EST)
The market took a breather on Thursday after some disappointing jobless claims numbers but held support following Wednesday’s big pop. The bulls did rather well in holding their ground but Fed Chairman, Ben Bernanke, kept a lid on any comeback after saying the unemployment rate is not going to fall significantly anytime soon. Despite his predictions of 3%-4% economic expansion in 2011, Big Ben warned it wouldn’t be enough to make a meaningful dent in the 9.6% unemployment rate.
On that note, the Dow slipped 24 points to close at 11,731 with Merck (MRK, $34.69, down $2.46) being the biggest decliner of the blue-chip index. Shares fell nearly 7% after the company said it would discontinue trials for its anti-clotting drug, Vorapaxar, and accounted for nearly 19 points of the 24 point Dow decline. The Dow is up 57 points for the week and if the bulls hold 11,674, the index will stretch its winning streak to 7 straight.
The S&P 500 darted in-and-out of positive territory for much of the session before finishing with a 2 point loss to settle at 1,283. The bulls can make it 6 weeks in-a-row if they hold 1,271.
The Nasdaq also fell 2 points to finish at 2,735 after trading to a high of 2,742 intra-day. Of course, the big news this morning was Intel’s (INTC, $21.29, down $0.01) earnings announcement after the close yesterday.
The company reported a profit of $3.4 billion, or $0.59 a share, up from $2.3 billion, or $0.40, in the year-earlier period. Revenue jumped over 8% to $11.5 billion. Wall Street was looking for $0.53 a share on sales of $11.4 billion. Intel reported gross margins of nearly 68% and also raised guidance for the current quarter.
Heading into the open, shares are up 20 cents to $21.49.
Elsewhere, JPMorgan Chase (JPM, $44.45, down $0.26) reported earnings of $4.8 billion, or $1.12 a share, up from $3.3 billion, or $0.74 a share, in the year ago quarter. Wall Street was looking for $1 a share. Revenue checked in at $26 billion versus expectations for $24 billion.
As we head to press, Dow futures are down 43 points while the S&P 500 futures are lower by 5 points. The Nasdaq 100 futures are off by 2 points.
We have a lot to cover in our Members Area this morning as a number of our trades have exploded this week. We have updated all positions with new stops to lock in profits on some of our triple-digit winners.
Tags: call options, INTC, momentum options, Momentum stocks, mrk, NYSE: INTC, NYSE: JPM, option signals
Posted in Earnings, Market Commentary | Comments Off
Tuesday, October 12th, 2010
1:10pm (EST)
The bulls appear a little nervous ahead the release of the Fed minutes from September’s meeting which should be out in a little over an hour. Futures were pointing towards a lower open from the start as word spread that China will start forcing banks to hold more reserves after making similar moves to curb lending earlier this year to avoid speculative bubbles.
Wall Street will be looking for clues about the Fed widely expected plans to further stimulate the economy through bond purchases, or quantitative easing (QE2), and when it might happen. Treasury prices continue to rise in anticipation the Fed will start buying government bonds to “get things going” but investor’s want specifics.
The Fed, or really Ben Bernanke’s comments from August, hinted in the brief statement it released after the meeting last month that it was prepared to help jump-start the stagnant economy, though it provided few details about its plans. This led to a huge September rally that has taken the market near the top end of its recent trading range and just below the April highs.
The big news after the bell will be lntel (INTC, $19.61, up $0.05), which reports 3Q earnings after the bell. The company is expected to report earnings of $0.50 a share on revenue of $11 billion after lowering the expectation bar in August.
A year ago, for Q3, the company posted a profit of $0.35 a share on revenue of $10.2 billion and in its most recent quarter, Intel posted earnings of $0.51 a share on $10.8 billion in sales. In fact, it was the company’s “best quarter ever” so they will need to at least match expectations or beat by a penny to have any hope of impressing Wall Street.
There were a slew of analyst downgrades after Intel lowered expectations for the current quarter with most of the ratings being changed from a “Buy” to a “Hold”. There are currently over 30 analysts who rate the stock a Buy, and nearly 20 others with a Hold rating. There are 3 “Sell” ratings on the stock.
One thing is for certain, we should start to see volatility pick up from here on out.
As we head to press, the Dow is currently down 38 points to 10,972 while the S&P is off 2 points to 1,163. The Nasdaq is holding steady and is actually showing a gain of 4 points to 2,406. We have added a couple of new trades to our Watch List and we should be starting NEW positions over the next few days so stay locked and loaded.
We also have an IMPORTANT trade update that requires action today so subscribers please check the Members Area for the specifics.
Tags: Fed minutes, INTC, Intel earnings
Posted in Earnings, Trade Update | Comments Off
Friday, October 8th, 2010
1:35pm (EST)
Give the bulls credit. They are trying like hell to push this market though resistance.
Despite a nasty jobless claims report, 2 out of the 3 major indexes have pushed through our price targets as both the Dow and S&P 500 have cleared our fence. All we are waiting for is the Nasdaq, which seems to have a pants leg stuck in the barbwire, to confirm the jailbreak.
The Dow has broken 11,000 as the index has traded to a high of 11,016 and will need to close above this level to give the bulls a clear victory this week. The index is currently up 56 points and is a smidge over 11K at 11,009.
The S&P 500 has busted through 1,160 and is up 6 points to 1,164 and looks to be headed towards 1,175 and possibly 1,200.
However, the Nasdaq is at 2,399, up 16 points but just cleared 2,400, earlier, as we were heading to press.
Here were our thoughts yesterday:
“There is a feeling that the release of Friday’s monthly employment report will sway the market one way or the other but we think 3Q earnings will likely set the stage for where the market is headed over the short-term. We also have an uneasy feeling with the world currency debasing race that is currently going on and the parabolic moves gold, copper and silver are making is mind-blowing but we believe there could be some surprises, good and bad, that will dramatically impact the market over the next 3 weeks.”
Well, so far so good. It’s easy to be bullish in a market like this and while we would turn bullish (short-term) if the 3 major indexes CLOSED above our price targets, we are also aware that it will be vital to carry some kind of put option protection going forward.
It’s hard for investors to remember the bad times when the good times are so good right now, but, it was only 2 years ago this week that the Dow dropped 18% in a week. In other words, the index fell nearly 1,900 points in five days.
There is a saying that “history repeats itself” and often times in the market or in certain stocks, a pattern or history is repeated. We aren’t saying history will repeat itself…all we are saying is in this environment, strangles and straddles option trades will be your BEST FRIEND.
The strategies involve the purchase of both a call and put option which allows you security as long as the market is volatile. Check. We have that folks. In other words, you don’t have to know which way a stock or the market is going to have to move. You want volatility and huge price swings. Check.
This weekend there will be a number of important events taking place concerning the world’s currency and the market will be closed Monday.
Next week, Intel (INTC, $19.51, up $0.11) will report earnings on Tuesday (after the bell) along with Fastenal (FAST, $54.64, up $1.94). FAST which will report BEFORE the bell and the 52-week high is $56.65. If the bulls are still dancing and the two companies get “A’’’s on their earnings report cards, then look for Dow 11,300; Nasdaq 2,500; and S&P 1,200 over the near-term.
If some unexpected news or event happens over the weekend, or if Intel MISSES Wall Street’s estimates, then the market could retreat back into the 4-month long trading range, or worse.
Either way, we think 3Q earnings season will be intense and loaded with some GREAT opportunities to make some money on both call AND put options. We plan on using a combination of both (strangles and straddles) but we will also be playing some directional trades straight up.
Remember, we teach these kind of option strategies in our new trading manual “How to Trade Options on Momentum Stocks” which is available NOW with a FREE 1-month membership included (a $129 value).
We will be releasing our first video this weekend for those of you have ordered our course. Details will be emailed to you and we plan to cover the upcoming earnings season and how to find trades, as well as an overview on strangles and straddle option strategies which are covered in our option manual.
Have a great weekend everyone and get ready for some action over the next 3 weeks!
Tags: explain the concept of options, INTC, Intel, momentum options trading, option picks, option trading blog, option trading course, option trading courses, straddle option trades, strangle option trades, triple-digit options returns
Posted in Earnings, Market Analysis, Market Commentary | Comments Off
Monday, August 30th, 2010
12:45pm (EST)
It’s been a slow day of trading although the bears took an early stab at stocks and pushed the market lower at the open. The bulls have battled back somewhat but they didn’t seem too inspired despite a flurry of merger and acquisition (M&A) news today. The lack of follow-through from Friday’s big push isn’t a good sign to start the week and the bulls will face major resistance levels if they do mount a rally today.
In corporate news, Intel (INTC, $18.07, down $0.30) said it was buying Infineon Technologies AG’s wireless-solutions business for nearly $1.4 billion in cash. This wasn’t a huge deal for Intel, which warned of lower revenue growth for the current quarter, but it was a smart one. The deal with Infineon will bolster Intel’s internet business and allow the company to offer a full range of wireless options, including 3G, Wi-Fi and Wi-Max.
3M (MMM, $80.29, down $0.71) stepped-up to the plate and offered Cogent (COGT, $10.72, up $1.81) $10.50 a share to do a deal. Shares are up 20% and Wall Street is valuing the marriage at $1 billion. 3M is in love with Cogent’s toys which capture electronic fingerprint and palm print images that can then be used to encode prints into searchable files. This allow cross-referencing and companies or agencies can then compare a set of prints to a database.
And finally, in a deal that looks like the ante may have to be raised, Genzyme (GENZ, $70.10, up $2.48) is up 4% after rejecting Sanofi-Aventis (SNY, $29.03, up $0.11) proposal to acquire them for $69 a share in cash. Genzyme has an impressive drug in its pipeline and could be holding out for $80-$85 a share. They think they have something special with Campath, a multiple sclerosis drug that is in the experimental stages, and Genzyme wants a bigger premium to account for potential sales.
As we head to press, the Dow is down 68 points, or 0.7%, and is at 10,082. We mentioned in our Weekly Wrap that resistance would come in at 10,200 and the low for the day has been 10,071.
The S&P is lower by 7 points, or 0.7%, and is at 1,057. The index continues to have trouble with the 1,070 level and a break below 1,040 will not be good for the bulls. The S&P has traded to a low of 1,056 today.
The Nasdaq is once again leading the way to the downside as the index is off by 16 points, or 0.8%, to 2,137. Tech has traded to a high of 2,154 and the 2,150 level continues to act as strong resistance. Support is at 2,100 and then 2,050.
We have updated all of our current trades and we have spent much of the morning looking for new trades this week. There are a few we like, but we want to do more research before adding them to our Watch List which is already exploding with possible plays were are eyeballing. Subscribers, check the Members Area for the updates.
Tags: 3M, GENZ, INTC, option picks, SNY, stock options trading
Posted in Market Commentary, Mergers and Acquisitions | Comments Off
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Intel (INTC) Impresses, JPMorgan (JPM) Beats Estimates
Friday, January 14th, 2011
8:50am (EST)
The market took a breather on Thursday after some disappointing jobless claims numbers but held support following Wednesday’s big pop. The bulls did rather well in holding their ground but Fed Chairman, Ben Bernanke, kept a lid on any comeback after saying the unemployment rate is not going to fall significantly anytime soon. Despite his predictions of 3%-4% economic expansion in 2011, Big Ben warned it wouldn’t be enough to make a meaningful dent in the 9.6% unemployment rate.
On that note, the Dow slipped 24 points to close at 11,731 with Merck (MRK, $34.69, down $2.46) being the biggest decliner of the blue-chip index. Shares fell nearly 7% after the company said it would discontinue trials for its anti-clotting drug, Vorapaxar, and accounted for nearly 19 points of the 24 point Dow decline. The Dow is up 57 points for the week and if the bulls hold 11,674, the index will stretch its winning streak to 7 straight.
The S&P 500 darted in-and-out of positive territory for much of the session before finishing with a 2 point loss to settle at 1,283. The bulls can make it 6 weeks in-a-row if they hold 1,271.
The Nasdaq also fell 2 points to finish at 2,735 after trading to a high of 2,742 intra-day. Of course, the big news this morning was Intel’s (INTC, $21.29, down $0.01) earnings announcement after the close yesterday.
The company reported a profit of $3.4 billion, or $0.59 a share, up from $2.3 billion, or $0.40, in the year-earlier period. Revenue jumped over 8% to $11.5 billion. Wall Street was looking for $0.53 a share on sales of $11.4 billion. Intel reported gross margins of nearly 68% and also raised guidance for the current quarter.
Heading into the open, shares are up 20 cents to $21.49.
Elsewhere, JPMorgan Chase (JPM, $44.45, down $0.26) reported earnings of $4.8 billion, or $1.12 a share, up from $3.3 billion, or $0.74 a share, in the year ago quarter. Wall Street was looking for $1 a share. Revenue checked in at $26 billion versus expectations for $24 billion.
As we head to press, Dow futures are down 43 points while the S&P 500 futures are lower by 5 points. The Nasdaq 100 futures are off by 2 points.
We have a lot to cover in our Members Area this morning as a number of our trades have exploded this week. We have updated all positions with new stops to lock in profits on some of our triple-digit winners.
Tags: call options, INTC, momentum options, Momentum stocks, mrk, NYSE: INTC, NYSE: JPM, option signals
Posted in Earnings, Market Commentary | Comments Off