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Tuesday, April 24th, 2012
1:25pm (EST)
The market is up going into the second half of trading but the major indexes are off their highs with Tech turning negative as we go to press.
Netflix (NFLX, $87.84, down $14) fell hard in last night’s after-hours session after the company reported earnings which carried over into today’s session. Shares are down 15% after Netflix reported a loss for the quarter of $4.58 million, or 8 cents a share, on revenue of $870 million. This was ahead of an expected loss of $866 million, or 27 cents a share, analysts had penciled in.
The problem with the report was the company’s streaming video forecast which came in at 500,000 subscribers, which was much lower than the 1.2 forecast.
The May 80 puts (NFLX120519P00080000, $2.00, flat) opened at $2.94 and traded up to $3 but the options are flat as the premiums deflated. We profiled these puts last week near a buck but we didn’t feel comfortable with the risk/ reward for the trade. Although it would have been a nice return, we decided to sit on the sidelines.
We would love to play Apple (AAPL, $572.98, down $14.46) which reports earnings after the close but the option premiums are also very expensive on this stock as well.
We mentioned Sunday night there were 44 Wall Street analysts who follow Apple and on average, they are looking for earnings of $10 a share, on revenue of $36.6 billion. The low estimate is $8.48 a share on revenue of $32.8 billion while the high numbers are $11.80 a share on $41.1 billion in sales.
Apple might have to do $12 a share and top $42 billion in revenue just to blow away whisper numbers or there could be a serious selloff. If they miss numbers, which we seriously doubt, Tech will get a major correction.
The whisper numbers are 33 million iPhones, 12 million iPads and 4 million Macs. Cash reserves could top $110 billion. The new iPad only had 2 weeks of sales in the March quarter and many consumers are holding out for the iPhone 5. This causes us a little concern but we will also be sitting this one out.
We have some action to take on our current trades so we have to roll. The Dow is up 84 points to 13,011 while the S&P is higher by 5 points to 1,372. The Nasdaq is down 10 points to 2,960. Subscribers, please read all trade instructions carefully and we will be back in the morning with our next update.
Tags: Apple put options, Apple's earnings announcement, momentum options, Momentum stocks, NFLX earnings
Posted in Earnings, Market Analysis, Trade Update | Comments Off
Wednesday, March 14th, 2012
12:10pm (EST)
The bulls charged higher this morning as the market extended its rally following yesterday’s good news on the banks.
We have been super busy today and we have even more profits to take. Another one of our trades is up 100% which makes 3 triple-digits winners in one-day and we have profits to take on a bullish Pepsico (PEP, $64.30, down $0.04) trade that is up over 60%.
We told you to get another wheelbarrow out in February and we may need another one as the profits continue to pour in for our subscribers.
As we head to press, the Dow is up 16 points to 13,193 while the S&P 500 is off by 2 points to 1,394. The Nasdaq is lower by a point to 3,038.
Subscribers, check the Members Area for the important updates and make sure you read the trade instructions carefully. It has been an incredible day and we will go over all of the details in the morning!
Tags: call option trading, Momentum stocks, PEP
Posted in Hot Stocks, Market Commentary, Option Trades, Strategies | Comments Off
Wednesday, February 22nd, 2012
1:00pm (EST)
The bulls are struggling with resistance once again as they have been unable to mount an attack following yesterday’s lackluster performance. Economic news will be light for the holiday shortened week and today’s housing numbers failed to provide a lift even though they came in better-than-expected.
Existing Home Sales for the month of January showed an increase of 4.3%, versus an expected pop of 1%. However, December’s growth rate was revised lower which helped the numbers.
Looking at earnings, Dell (DELL, $17.02, down $1.19) is down nearly 7% after missing Wall Street’s estimates by a penny. Hewlett-Packard (HPQ, $28.95, down $0.40) will report after the close along with Polypore International (PPO, $43.14, down $0.05).
One stock we are watching closely today is Vivus (VVUS, $10.55) which has been HALTED for pending news. The company is hoping to get the green light for its obesity drug, Qnexa, and is meeting with the suit-and-ties in Silver Spring, Maryland.
A FDA advisory panel will make a recommendation to the board on if the drug should be approved or not. This is not a final verdict, but today’s decision will carry a ton of weight (pun intended) on if the drug makes it to market.
Another possible event that could get the Nasdaq going is Apple’s (AAPL, $512.75, down $2.10) shareholder meeting on Thursday. If the company were to announce a “special dividend” or even better, they say they are buying Twitter, shares would likely continue their recent assault on 52-week highs. We will likely get the iPad3 update and maybe an iPhone5 tease but we would like to see them do something with the $100 billion they have in cash.
As far as the market, the Dow is down 39 points to 12,926 while the S&P 500 is off 5 points to 1,357. The Nasdaq is showing a loss of 15 points and was last seen at 2,933. As usual, we have a lot to cover in our Members Area so let’s get on it. Subscribers, check for the updates and we will see the rest of you Thursday AM.
Tags: call options, Dell, Momentum stocks, PPO
Posted in Earnings, Economic News, Market Analysis | Comments Off
Tuesday, January 31st, 2012
12:45pm (EST)
The bulls were making a push towards resistance on renewed optimism that a deal with Greek bondholders and euro zone officials could be reached but got stymied by worse-than-expected economic news. The headlines were “negative” due to the misses but the numbers were still pretty good for the most part despite what the talking heads are saying.
The Case/Shiller 20-City Home Price Index fell 3.7% in November while the Chicago Purchasing Managers report showed a reading of 60.2 versus expectations for a reading of 63. Meanwhile, Consumer Confidence came in at 61.1 versus a forecast for print of 68. These are solid numbers but the market isn’t seeing that way, yet.
As a result, the bears saw a little daylight to push support one last time. While there remains a ton of headline risk this week, we still need to be cautious of a pullback although we are hoping the bulls make one last push towards the 52-week highs.
We can afford to be a little aggressive due to our incredible month but we are taking smaller positions in case the bears crack a couple layers of support.
The Financial stocks have turned positive which is a good sign as the Financial Select Spiders (XLF, $14.15, up $0.05) are trying to hold support and make another push at resistance which is up ahead at $14.50.
As we head to press, the Dow is down 56 points to 12,597 while the S&P is off by 3 points to 1,309. The Nasdaq is lower by 7 points to 2,805.
We are adding 1 more NEW TRADE today so we have to roll.
Subscribers, please check the Members Area for the updates. Also, today is the last day to take advantage of our special offer to get the Daily and Weekly publications for one low price. We are also including our options trading manual, How to Trade Options on Momentum Stocks, at no charge. This package comes with bi-monthly videos that show you how to read charts and find trades.
We have set up a special tab on our subscription page where you will see both the Daily and the Weekly in a package deal that reads Annual Subscription to Daily and Weekly Wrap. You will not need a coupon for this deal and the savings are over 65%. The tab will be removed on Wednesday.
https://secure.momentumoptionstrading.com/amember/signup.php
Do the paperwork and we will send out our option trading course to you as soon as we get your order and provide you access to our videos right away.
We will be back in the morning with our next update.
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 Economic News, Financial Stocks, Market Analysis | Comments Off
Friday, January 27th, 2012
9:00am (EST)
The bulls made a run at the April/ May 2011 highs on Thursday and now the Wall Street pros and talking heads are calling for a pullback. Funny thing is, they have been calling for a correction all month. Economic news was decent and earnings once again came in above expectations but Wall Street was right, the market “pulled back” yesterday.
A bigger-than-expected jump in durable-goods orders, which came in at 3% versus expectations for a rise to 2%, was the good news. The semi-bad, unemployment edged-up as Initial Claims jumped 21,000 to 377,000. This is still below 400K and we said to watch this rise in January. If claims can stay below 400,000 in February, and maybe improve, then the bulls might still have some gas in the tank.
After 4 steps forward, housing took one step back as sales of new single-family homes fell for the first time in four months in December. This was expected in our books as homebuyers usually focus on the holidays in December if they didn’t rush to get into the new house by Christmas or knew the paperwork wouldn’t be finished in time.
If we can get some rebound numbers in February, which starts next Wednesday, then the rally might have further to run. It’s been a warm winter here on the Left Coast this year.
As far as the official numbers -
The Dow dropped a double-deuce (22 points), or 0.2%, to close at 12,734. The blue-chips reached a peak of 12,842, which triggered our 12,800 target we gave back in November, while the low was 12,695.
The S&P 500 slipped 8 points, or 0.6%, to settle at 1,318. The index kissed 1,333 but traded outside our 1,325-1,350 zone after touching a low of 1,313 with an hour to go in yesterday’s session.
The Nasdaq fell 13 points, or 0.5%, to finish at 2,805. Tech traded up to 2,834 and held our 2,800 target after kissing 2,794. We have said to watch 2,887 which is the 52-week high for the index and have mentioned a run to 3,000 could come on fluff.
The S&P Volatility Index (VIX, 18.57, up 0.26) traded down to 16.80 at the open and we have been saying for months the VIX was would move from the mid-30’s, down to 22.50, and then down to 15 on a continued run by the bulls. The “fluff’ should get the VIX down to 15 but we also realize the VIX could trade down to 12. For news subscribers, a declining VIX is bullish.
A few weeks ago we said to be prepared for a pullback in February which doesn’t start until next Wednesday and the first full week of February isn’t until next Monday. With ALL of the suit-and-ties, talking heads, and everyone else going on record this week and saying this week is the top, maybe the market ignores them until February officially starts.
This leaves a lot of room for a run past resistance and the “fluff” could give Wall Street fund managers fits because they are already underperforming the market. This could also get some money off the sidelines from individual investors. The market could also get some positive Greece news today or next week which could also extend a possible 4-week rally into next but the bulls have to hold their lead today which we will cover in the afternoon update.
Then again, the market could pull back but it will take a lot to change the TREND and we have support pegged.
We have closed 3 more winning call option trades this week for profits of 114%, 58% and 107%. We may close one or two more trades today and our 2012 CLOSED Track Record is now 16-1 for the Daily and 7-0 for the Weekly Wrap. Let’s keep the momentum going.
Futures are lower as we head to press and look like this: Dow (-55), S&P 500 (-6), Nasdaq (-7). 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, VIX, weekly options, what are options
Posted in Market Analysis, Market Commentary, Trade Update | Comments Off
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Market Flat After Push Higher
Wednesday, March 14th, 2012
12:10pm (EST)
The bulls charged higher this morning as the market extended its rally following yesterday’s good news on the banks.
We have been super busy today and we have even more profits to take. Another one of our trades is up 100% which makes 3 triple-digits winners in one-day and we have profits to take on a bullish Pepsico (PEP, $64.30, down $0.04) trade that is up over 60%.
We told you to get another wheelbarrow out in February and we may need another one as the profits continue to pour in for our subscribers.
As we head to press, the Dow is up 16 points to 13,193 while the S&P 500 is off by 2 points to 1,394. The Nasdaq is lower by a point to 3,038.
Subscribers, check the Members Area for the important updates and make sure you read the trade instructions carefully. It has been an incredible day and we will go over all of the details in the morning!
Tags: call option trading, Momentum stocks, PEP
Posted in Hot Stocks, Market Commentary, Option Trades, Strategies | Comments Off