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Wednesday, May 23rd, 2012
9:00am (EST)
Yesterday’s market action reminded us of Saturday’s Preakness horse race as the bears “had another” to claim the photo-finish win. The bulls led the entire session as the Dow and S&P were looking to make it back-to-back wins for the first time since late April but the bears won the race as the closing bell sounded.
The Dow slipped 2 points, or 0.01%, to finish at 12,502. The blue-chips tested 12,600 like we said they would but had trouble clearing this level as they attempt to make a run at 12,800. Yesterday’s low was 12,447 but the close above 12,500 was positive.
The S&P was up less than a point and settled at 1,316 after reaching a peak of 1,328. The move above 1,325 could be a clue that 1,350 is still in play but we are waiting for 1,334 to print as confirmation.
The Nasdaq fell 8 points, or 0.3%, to close at 2,839. Tech kissed a high of 2,867 before fading down to 2,823. The close above 2,825 was encouraging but resistance at 2,850 needs to be cleared as confirmation for a possible run back to 2,900.
Side Chart Notes: The Russell 2000 fell 5 points to end at 759 while the S&P Volatility Index closed just under the 22.50 level at 22.48, up 0.47.
Facebook (FB, $31, down $3.03) continued its freefall while its CEO enjoys the honeymoon, literally. Word has it that Mark and his longtime gal tied the knot, which is cool, and well deserved, but the timing seemed a little weird to us.
Most CEO’s don’t plan on getting married the day after their company goes public but a $20 billion bankroll sure makes the places and things you can do seem unimaginable. Good for Mr. and Mrs. Zuck but shares are starting to suck and were down another 9% yesterday.
The only reason we brought you this story, because we are tired of typing the name, is because the options should be listing in a week or so for Facebook. The premiums on the call and put options will be expensive and we might have to get creative but we plan on dabbling in them once they list.
Futures are showing a nasty open this morning after being weak for much of the night. Dow futures are down 95 points to 12,381 while the S&P 500 futures are lower by 11 points to 1,303. The Nasdaq futures are declining 21 points to 2,514.
Subscribers, check the Members Area for the updates.
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Futures, Market Analysis, Market Commentary, VIX | Comments Off
Thursday, May 3rd, 2012
1:20pm (EST)
The market has traded in a tight range all week but with today’s losses, the bears are now winning the week. Economic news has been mixed with jobless claims coming in better-than-expected.
Initial Claims fell 27,000 to 365,000 versus expectations for a print of 379,000. Continuing Claims fell 53,000 to 3.27 million compared to a forecast for 3.3 million claims. Non-farm Productivity decreased 0.5% in the first quarter which was better than calls for a 0.6% decline while Unit Labor Costs were up 2.0% versus expectations for an increase of 2.7%.
Futures got a pop on the news and were up before the open but started to slide as we headed to press this morning. After a flat open, the bears got some good news as the ISM Service Report came in at 53.5 which was below the suit-and-ties forecast for a reading of 55.3.
While we too are focused on Friday, we did take a victory lap around the office as we nailed our biggest trade of the year so far. Two weeks ago we recommended a put option trade on Green Mountain Coffee Roasters (GMCR, $26.27, down $23.25) that we felt had a really good chance of doubling. That was an understatement.
We have been following the company for years and when we first profiled the trade, we talked about the last two times the company had reported earnings. Here is the chart work we showed our subscribers on why we felt this would be a homerun trade as we had a good feeling the company would miss expectations this time around.
The chart work from this morning showed a drop to $25 was possible and today’s low has been $24.40. We recommended the May 35 puts (GMCR120519P00035000, $8.25, up $7.85) at 85 cents on April 17th and they have traded to a high of $10.60 today.
Shares did trade above $30 for about a minute so we closed the trade as we stuck to our trading plan. Although we left a little on the table, our near-term target has been hit and the options expire in two weeks.
We were able to turn $850 into $5,750 for a 576% gain but some of our subscribers have gotten out at higher prices. Awesome!
This was our second big earnings trade in less than a week that has made us some monster profits. Last week, we closed a Deckers Outdoor (DECK, $54.08, down $0.93) put option trade for a 180% win!
The good news is we could have two more trades that could be just as powerful. One more this week, one next week.
As we head to press, the Dow is down 40 points to 13,228 while the S&P is off 7 points to 1,395. The Nasdaq is lower by 26 points to 3,033.
Subscribers, check the Members Area for the updates and get ready for Friday!
Tags: DECK, Deckers Outdoor, Green Mountain Coffee Roasters (GMCR), momentum options, Momentum stocks
Posted in Earnings, Hot Stocks, Market Analysis, Market Commentary | Comments Off
Wednesday, May 2nd, 2012
2:00pm (EST)
The market is mixed as we head into the final few hours of trading. The bears got a nice jump at the bell following worse-than-expected data from the ADP Employment Change report which showed only 119,000 private-sector jobs were added in April. Wall Street was looking for a print of at least 170,000 job additions.
Elsewhere, Factory Orders also were slightly ahead of expectations, coming in at 1.5% for March, versus expectations for a 1.6% drop.
Thursday is a heavy day for the market as the Challenger Jobs Cuts will set the tone and comes out at 7:30am (EST). Initial and Continuing Claims are due out an hour before the bell along with the latest Productivity and Unit Labor Costs numbers. At 10am, the ISM Services report is due out.
Earnings for Thursday include: Bebe Stores (BEBE, $8.46, up $0.52), First Solar (FSLR, $18.09, down $0.33), General Motors (GM, $22.93, down $0.38), Liquidity Services (LQDT, $55.49, up $2.52), MGM Resorts (MGM, $13.73, up $0.44), Public Storage (PSA, $145.27, up $0.23) and Trimble Navigation (TRMB, $54,15, up $0.20).
As we head to press, here is how we look.
The Dow is down 24 points to 13,255 while the S&P is lower by 5 points to 1,400. The Nasdaq is up 4 points to 3,054.
Some of our current trades are doing well today so let’s go check on them as well.
Subscribers, check the Members Area for the updates.
Tags: Challenger Jobs Cuts, MGM, MGM Resorts earnings, momentum options, Momentum stocks
Posted in Earnings, Economic News, Market Commentary | Comments Off
Friday, April 27th, 2012
1:15pm (EST)
Spain got downgraded 2 notches last night which weighed on futures but they were up before the open this morning as the bulls are stretching resistance.
The Dow came into the week at 13,029; the S&P 500 1,378; the Nasdaq 3,000. If resistance holds, it appears the market could be in an extended 4-week trading range as the bulls and bears continue to battle to establish the next TREND.
Despite the bullish week, we were able to close put options on LinkedIn (LNKD, $106.22, up $0.98) for a gain of nearly 70% and 33% on a bearish S&P Spiders (SPY, $140.34, up $0.18) option trade. Today, we closed a huge winner as our Deckers Outdoor (DECK, $51.90, down $17.56) May 50 puts (DECK120519P00050000, $1.50, up $1.30) returned our subscribers 180%! We were out at $1.40 after getting in at 50 cents and the puts have traded to a high of $1.80 today.
The beauty of options is that this trade was down 60% as we headed into earnings last night but we did our research and knew the company would disappoint Wall Street with their quarterly numbers. Although we may have hit the register a little early, it’s hard to feel bad with a return of 180%. Plus, some of the current trades are showing strong gains so we expect to be busy next week.
This brings our Track Record for 2012 to 75-18 which is an 80% win rate.
As we head to press, the Dow is up 35 points to 13,150 while the S&P 500 is higher by 2 points to 1,401. The Nasdaq is advancing 10 points to 3,060.
We would love to see a close below Dow 13,200; S&P 1,400; and Nasdaq 3,050, obviously, which we said should hold as resistance.
As we do our chart work over the weekend, we will try to find the clues that will give us the next possible trend direction and there is one more trading day for April. May is normally a bearish month and the problems from overseas still loom. We have called for this back test to the top but we are still positioned for a downside move.
We will look at some call options over the weekend in case there is a breakout but our last 13 CLOSED trade recommendations have been put options. We made a side note in early April for our 2012 portfolio and marked it “Trend Change?” as we noticed we were starting to recommend put options after going heavy on call options all year long.
So far, the break below the uptrend line has been rewarding as our subscribers have closed 2 triple-digit winners, another 3 trades that have returned 70% and another trade for a 50% return. The rest of the trades range in profit from 12% to 33% so the register has been ringing all month long despite a 4-week trading range.
We have started establishing our next “batch” of trades and if we are right about the market’s next move, we could have many more triple-digit winners.
If you are not in the game, we continue to tell investors this is one of the BEST environments we have seen in a couple of years to trade options. For those of you who haven’t signed up with us, hop on the bus, Gus!
We have action to take on 2 more trades before we roll so let’s go check the Members Area.
We will be back Sunday night with the Weekly Wrap so until then, have a great weekend everyone!
Tags: DECK put options, LNKD put o[tions, market trend change, Momentum stocks
Posted in Market Analysis, Market Commentary, Trade Update, Trading Tips | Comments Off
Thursday, April 26th, 2012
9:00am
The bulls got back-to-back wins, technically, as the market moved higher on Wednesday following the good news from Apple (AAPL, $610, up $49.72) which lifted Tech more than 2% for the session. Like a broken record, the Fed did its part by making no changes to interest rates and saying it will do what is necessary to keep the economy afloat.
Ben Bernanke did not waver in his words with the press and said the Fed “would not hesitate” to launch another bond buying program to lower borrowing costs, if needed. The market got another shot in the arm on those words and finished near its highs for the day.
The Dow gained 89 points, or 0.7%, to close at 13,090. The blue-chips reached a high of 13,105 but never really came close to challenging the 13,200 level which has been strong resistance in recent weeks.
The S&P 500 advanced 19 points, or 1.4%, to settle at 1,390. The index traded up to 1,391 but also fell short of challenging resistance at 1,400. If the bulls cannot clear this level by Friday’s close, the trend is still lower.
The Nasdaq soared 68 points, or 2.3%, to end at 3,029. Tech reached a peak of 3,031 but the Apple (AAPL, $610.62, up $50.34) news wasn’t enough to get past 3,050. We were looking for a finish below 3,025 and anything below 3,000 by Friday’s close would be beautiful going into next week.
We knew there was a good chance the bulls would make a run at resistance but we feel like they just don’t have enough reinforcements to get past resistance.
We have added some new candidates to our Watch List and hopefully we get some pin action today, meaning, we hope to ring the register. We have a couple of trades that are doing really well and the May options still have 3 weeks before they expire. However, we need to take profits when we can as we start getting to our next batch of trades.
We also said we are starting to look at some Juicy June options because we believe the market could be entering one of the best times of the year to trade. We have had an incredible first 4 months as our 2012 Track Record is showing some of the most powerful option trading returns in the business. We are 74-18 to start the year for an 80% win rate, including an American Express call option trade that returned 475% during March’s Madness in just 16 days.
The next 3 months could be just as good.
As we head to press, futures look like this: Dow (-27); S&P 500 (-4), Nasdaq 100 (-5).
Tags: Ben Bernanke, Fed, Momentum stocks, nasdaq support levels, options trading, powerful option trading returns, top option trading returns
Posted in Market Analysis | Comments Off
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Bears Have Another, Facebook (FB) Getting Zuckerberged
Wednesday, May 23rd, 2012
9:00am (EST)
Yesterday’s market action reminded us of Saturday’s Preakness horse race as the bears “had another” to claim the photo-finish win. The bulls led the entire session as the Dow and S&P were looking to make it back-to-back wins for the first time since late April but the bears won the race as the closing bell sounded.
The Dow slipped 2 points, or 0.01%, to finish at 12,502. The blue-chips tested 12,600 like we said they would but had trouble clearing this level as they attempt to make a run at 12,800. Yesterday’s low was 12,447 but the close above 12,500 was positive.
The S&P was up less than a point and settled at 1,316 after reaching a peak of 1,328. The move above 1,325 could be a clue that 1,350 is still in play but we are waiting for 1,334 to print as confirmation.
The Nasdaq fell 8 points, or 0.3%, to close at 2,839. Tech kissed a high of 2,867 before fading down to 2,823. The close above 2,825 was encouraging but resistance at 2,850 needs to be cleared as confirmation for a possible run back to 2,900.
Side Chart Notes: The Russell 2000 fell 5 points to end at 759 while the S&P Volatility Index closed just under the 22.50 level at 22.48, up 0.47.
Facebook (FB, $31, down $3.03) continued its freefall while its CEO enjoys the honeymoon, literally. Word has it that Mark and his longtime gal tied the knot, which is cool, and well deserved, but the timing seemed a little weird to us.
Most CEO’s don’t plan on getting married the day after their company goes public but a $20 billion bankroll sure makes the places and things you can do seem unimaginable. Good for Mr. and Mrs. Zuck but shares are starting to suck and were down another 9% yesterday.
The only reason we brought you this story, because we are tired of typing the name, is because the options should be listing in a week or so for Facebook. The premiums on the call and put options will be expensive and we might have to get creative but we plan on dabbling in them once they list.
Futures are showing a nasty open this morning after being weak for much of the night. Dow futures are down 95 points to 12,381 while the S&P 500 futures are lower by 11 points to 1,303. The Nasdaq futures are declining 21 points to 2,514.
Subscribers, check the Members Area for the updates.
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Futures, Market Analysis, Market Commentary, VIX | Comments Off