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Monday, December 27th, 2010
9:10am (EST)
The bulls have been on a roll and here is where they are at:
The Dow added 14 points on Friday, or 0.1%, to finish at 11,573. For the week, the index added 82 points, or 0.7%, and broke through strong resistance at 11,500. We have been targeting the 11,600-11,700 area since the break over 11,400 which occurred at the beginning of December. There is a chance the Dow can test 12,000 in 2011 but first things, first. Support will come in at 11,350 with backup at 11,200.
The S&P 500 slipped 2 points, or 0.2%, to settle at 1,256. For the week, the index popped 13 points, or 1%, and powered past the 1,245-1,250 area which had been strong resistance. We are now looking for a run up to 1,275 by yearend with 1,300 in the cards if the rally continues into next year. Support is strong at 1,220-1,200 but we would like to see 1,250 hold for the week.
The Nasdaq gave up 6 points, or 0.2%, but added 23 points for the week, or 0.9%, and closed at 2,665. We have been mentioning the 2,660-2-665 area as strong resistance and we were watching for a break and close above 2,660, specifically, as confirmation for a chance at 3,000 for the index in 2011. The bulls made us proud here as the index finally cleared this level. Support will come in at 2,600-2,550 if the bears get motivated.
Here is the bigger picture:
The Dow started the year at 10,428 and is up 11%; the S&P was at 1,115 and is up 13%; the Nasdaq began 2010 at 2,269 and is currently showing a gain of 17% YTD. If the indexes can hold their gains this week, especially the Dow, then the market will be looking at double-digit gains for the year.
As we head to press, Dow futures are down 45 points; S&P 500 futures are lower by 5; Nasdaq 100 futures are off by 7 points. Subscribers, check the Members Area for the updates.
Tags: bear market, binary options, bull market, call option, how to trade options, Momentum stocks, option investments, option picks, option trading, options mentoring, options trading service, put option, stock market, stock market options
Posted in Market Analysis, Market Commentary | Comments Off
Thursday, December 23rd, 2010
1:00pm (EST)
The market is a little mixed as we head towards today’s close but the bulls are winning the week so here is what we are watching:
The Dow currently up 7 points to 11,565 and started the week at 11,491. Our yearend target is 11,600-11,700 for the index and it looks like we might nail it. We are looking for a bullish run up until next Friday which is usually a bearish day as it is the last trading day of the year. So, if we can get into this zone next week (or today), we think there will be a run up to 11,700 with a slight pullback to end the year.
The S&P 500 is down 2 points to 1,257 and started the week at 1,243. In mid-October, we said the index had a shot at 1,200 and this level was cleared during the first week of November. We then said to watch for 1,220 to be the next level the bulls take out and that happened by the first week of December. We then targeted 1,250 and we said if this level was broken then we have a shot at 1,275 by the end of the year. So far, so good.
The Nasdaq is currently down 4 points to 2,667 after starting the week at 2,642. We mentioned back in mid-October we were watching the 2,500 level for a confirmed breakout and this represented strong resistance. The bulls made it look easy as they blew past this level by the end of October. We then said we expect the index to trade up to 2,600-2,700 area which is where we have been since the first week of December. We also said if 2,660 were cleared then the bulls could push 3,000 in 2011.
Again, we are expecting a continued run by the bulls though next Thursday while the last Friday of the year has historically been bearish. However, we could see less selling pressure as investors hold onto their gains and delay paying capital gains taxes until 2012. Either way, the bulls are showing incredible momentum.
The market has been good to us and Santa has delivered a ton of incredible winning trades, early. We also have quite a few current trades which are up triple-digits and we are looking to carry some of those gains into 2011 while closing one out today. We couldn’t have asked for a better holiday for our subscribers as today’s closing trade represents a 112% return for our subscribers.
We are also probably going to add a few NEW positions to our current portfolio next week as we close out a few more winners and look ahead to 2011.
We are currently running a special deal where you can get our option trading manual, How to Trade Options on Momentum Stocks, for FREE if you subscribe to a 1-year membership to the Weekly.
We also said on Tuesday, if you purchase a 1-year membership to our DAILY newsletter, we will give you a FREE copy of the option trading manual which includes a copy of our Momentum Stocks Watch List. This manual breaks down dozens of sectors and over 600 stocks and makes it easy to start setting up your own Watch Lists. Your subscription will include all access to our ongoing training videos as well. We are not “advertising” this deal and it will only be good through the end of the 2010 so please hurry and take advantage of this offer.
We will be back on Sunday with the Weekly Wrap and we may have a NEW TRADE for the newsletter as we take a look at an exciting up and coming Biotech stock. Shares are currently at $15 but we expect a double to $30 for this gem in 2011. You can also take a look at all of our closed trades for 2010 to see the incredible run we have been on.
As we head towards the close, we would like to take this time to wish everyone a Happy Christmas and that we appreciate all of the cards and gifts that have been sent our way. See you next week and be safe!
Tags: bear market, binary options, bull market, call option, how to trade options, Momentum stocks, option investments, option picks, option trading, options mentoring, options trading service, put option, stock market, stock market options
Posted in Market Analysis, Market Commentary | Comments Off
Friday, December 17th, 2010
9:00am (EST)
The bulls took one more step towards breaking another layer of resistance on Thursday as they made a clean sweep of the major indexes. The action this week has been slow-and-steady as the bears lack any follow-through on negative headlines and seem content on giving up ground.
The Dow gained 42 points, or 0.4%, to close at 11,499 after trading up to 11,514. The index is up 89 points for the week as the bulls look for their third weekly win in-a-row. We are still looking for a run up to 11,600-11,700 while support is at 11,200-11,000.
The S&P 500 spurted higher by 7 points, or 0.6%, and finished at 1,242. The index continues to struggle at 1,245-1,250 but a break above here should easily carry the bulls to 1,275-1,300. Support remains at 1,220-1,200.
The Nasdaq jumped 20 points, or 0.8%, to settle at 2,637 after kissing a high of 2,639. Tech is encountering resistance at 2,640 but we are looking for a break above 2,660 as confirmation the bulls could push 3,000. Support is strong at 2,500-2,450.
After the bell last night, Research In Motion (RIMM, $59.24, up $0.06) reported some impressive numbers but shares were only slightly higher in extended trading last night (up 2%, to $60.50). The company reported a profit of $911 million, or $1.74 a share, compared to $628 million, or $1.10 a share, in the year ago period. Revenue surged 40% to $5.5 billion.
Wall Street was looking for earnings of $1.65 a share, on sales of $5.4 billion.
Going forward, RIMM projected earnings of $1.74-$1.80 a share on revenue of $5.5-$5.7 billion. The pencil-pushers were looking for $1.61 a share on sales of $5.46 billion.
In pre-market action, shares of RIMM are up $1.71, to $60.95.
Elsewhere, Visa (V, $67.19, down $9.75) and MasterCard (MA, $223.49, down $25.73) got pounded for losses or 13% and 10%, respectively, after the Federal Reserve proposed regulation for debit card interchange fees, which included a 12 cent cap on any fee for what the Fed deemed “Alternative 1”. Talk about being run over by the bus, the release of the document on the Fed’s website, blinded-sided the market but put option traders quick on their feet made a huge chunk of change in 2 hours.
The news hit the Street shortly after 2pm (EST) yesterday and the Visa December 70 puts (V101218P00070000, $3.20, up $2.98) zoomed 1,350% yesterday folks, after opening at 14 cents! Over 13,000 contracts traded hands. The Visa January 70 puts (V110122P00070000, $4.75, up $3.80) rocketed 400% on the news as 8,000 contracts swapped hands.
And wouldn’t you know it. We had been profiling a strangle option trade on Visa for months but it had stayed in a tight trading range – which we thought would continue into 2011 – and we watching it from afar. Shares had stayed in the $70’s for much of 2010 after a brief trip to $90 back in April, then a sell-off to the Disco era.
If traders continue to hammer these two stocks, we think we have found an even better candidate to ride their coattails on further weakness.
We have a lot to cover in the Members Area and as we head to press, futures are flat. Subscribers, check for the updates.
Tags: bear market, binary options, bull market, call option, how to trade options, Momentum stocks, NYSE:V, option investments, option picks, option trading, options mentoring, options trading service, put option, stock market, stock market options, V
Posted in Earnings, Hot Stocks | Comments Off
Thursday, December 16th, 2010
9:00am (EST)
The bulls took a few more baby steps at breaking through another layer of resistance on Wednesday but ran out of gas into the close as the market finished lower after spending much of the day in positive territory. There was a little progress made in the tax-break package that’s currently making its way through Congress as the proposed legislation cleared the Senate by a whopping approval of 81-19. The bill still has to make it through one more channel check as the Democrats try to get some sweeteners in the deal.
The Dow fell 19 points, or 0.2%, to finish at 11,457. The index managed to trade to a new 52-week high of 11,519 and we are targeting 11,600-11,700 as confirmation on a run to 12,000. Support is strong at 11,200-11,000.
The S&P 500 dropped 6 points, or 0.5%, and ended at 1,235. The index traded to a high of 1,244 but had its six-session winning streak snapped as we look for a break above 1,250. The bears are targeting 1,220 to get back in the game.
The Nasdaq gave back a little over 10 points, or 0.4%, and settled at 2,617. Tech appears to be trading sideways at the moment but did touch 2,643 and closed within our 2,600-2,700 range for the sixth straight session. We are looking for a break above 2,660, specifically, as a sign that the bulls might push 3,000 while support comes in at 2,500-2,450.
In stock news, BP (BP, $43.86, down $0.58) fell over 2% before recovering a little into the close after the U.S. government said it would sue the company (and others) for damages from the Gulf oil spill. The early estimates are as high as $20 billion in liabilities just from the Clean Water Act alone. Don’t forget about the $20 billion the government has already made BP put in a “fund” that is currently being used for claims.
The news came out shortly after lunch and the options pits exploded as shares traded to a low of $43.29. The BP December 43 puts (BP1011218P00043000, $0.21, up $0.12) opened at 6 cents and jumped over 133% for the day as nearly 10,000 contracts traded. The puts hit a high of 35 cents so some day traders did well by reacting to the news.
Of course, this is really old news because you knew the government was going to push a case to collect damages. In any event, if BP breaks below $40, we will be on an option trade faster than a pit bull on a pork chop as a test to $35 is most likely, according to the chart.
As we head to press, futures are showing a little strength this morning on better-than-expected economic news. We will cover the details in our afternoon update but it appears the bulls are going to push higher. Dow futures are up 7 points to 11,422 while the S&P 500 futures are higher by 2 points to 1,234. The Nasdaq 100 futures are showing an advance of 5 points to 2,206. Subscribers, check the Members Area for the latest trade updates.
Tags: bear market, binary options, BP, BP options, bull market, call option, how to trade options, Momentum stocks, option investments, option picks, option trading, options mentoring, options trading service, put option, stock market, stock market options
Posted in Company Commentary, Market Analysis | Comments Off
Wednesday, December 15th, 2010
1:10pm (EST)
The bulls are pushing the market higher after getting some better-than-expected economic news which has helped relieve some of the euro tensions from this morning. The Consumer Price Index for November increased 0.1% after a 0.2% increase in the prior month. It had been expected to increase 0.2% month-over-month. Core consumer prices for were up 0.1% after coming in flat two the previous three months. Meanwhile, the New York Empire manufacturing for November came in at 10.57, which was better than estimates for 3.0 that had been expected.
Although the market action is rather lackluster today, we are expecting a big move on Friday with December triple-witching. This has been a flat event for 2010, but historically, December is money with average gains of 2%. Triple-witching is when contracts for stock index futures, stock index options, and stock options all expire on the same day and it happens four times a year in March, June, September, and of course, December.
One stock we want to talk about today is the Boston Beer Company (SAM, $95.75, up $11.00) which is seeing a 13% pop in its shares. The company raised its 2010 yearend profit estimates and said earnings would be in the range of $3.30-$3.60 a share. Last month, Boston Beer forecast earnings of $2.85-$3.15 a share.
We have been watching this stock since early February when it was in the $40′s but the option pits just aren’t liquid enough for us to play them. However, we often mention “story stocks” on our site from time to time and this is one of them. In fact, here was an update on the company from May 4 (quotes are from that day):
“Another company we are watching is The Boston Beer Company (SAM, $58.63, up $1.62) which we have mentioned inside our Members Area a few times. Although we are not stock traders, these are shares we wished we would have picked up in the mid-$40’s back in February. We were looking at an option trade but there wasn’t enough liquidity for us to go long.” (END)
The average daily volume for the stock is just 75,000 shares which, like we said, makes it hard to trade options because of the bid/ask spreads which are usually jacked-up due to the lack of volume. However, the December 85 calls (SAM101218C00085000, $10.45, up $9.65) are up over 1,200% today but only 16 contracts have traded.
It’s pretty obvious shares want to test $100 on the “blue-sky” breakout but we are hoping for a 2-for-1 stock split, or 3-for-1, which would make shares cheaper for the average investor and possibly get more volume flowing into the stock and option chains.
We got to leave it there as we have a number of things to cover in our Members Area today. As we head to press, the Dow is up 7 points; the S&P is down 4; the Nasdaq is off 5 points.
We will be back in the morning but we are still seeing golden opportunities as we look out into 2011. If you are not a current subscriber, we urge you to consider this opportunity to get on board. Subscribers, check for the updates.
Tags: binary options, Boston Beer Company earnings, call option, how to trade options, NYSE: SAM, option investments, option picks, option trading, options mentoring, options trading service, put option, SAM, Sam Adams stock
Posted in Earnings, Hot Stocks | Comments Off
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Bulls Looking to End Year on High Note
Monday, December 27th, 2010
9:10am (EST)
The bulls have been on a roll and here is where they are at:
The Dow added 14 points on Friday, or 0.1%, to finish at 11,573. For the week, the index added 82 points, or 0.7%, and broke through strong resistance at 11,500. We have been targeting the 11,600-11,700 area since the break over 11,400 which occurred at the beginning of December. There is a chance the Dow can test 12,000 in 2011 but first things, first. Support will come in at 11,350 with backup at 11,200.
The S&P 500 slipped 2 points, or 0.2%, to settle at 1,256. For the week, the index popped 13 points, or 1%, and powered past the 1,245-1,250 area which had been strong resistance. We are now looking for a run up to 1,275 by yearend with 1,300 in the cards if the rally continues into next year. Support is strong at 1,220-1,200 but we would like to see 1,250 hold for the week.
The Nasdaq gave up 6 points, or 0.2%, but added 23 points for the week, or 0.9%, and closed at 2,665. We have been mentioning the 2,660-2-665 area as strong resistance and we were watching for a break and close above 2,660, specifically, as confirmation for a chance at 3,000 for the index in 2011. The bulls made us proud here as the index finally cleared this level. Support will come in at 2,600-2,550 if the bears get motivated.
Here is the bigger picture:
The Dow started the year at 10,428 and is up 11%; the S&P was at 1,115 and is up 13%; the Nasdaq began 2010 at 2,269 and is currently showing a gain of 17% YTD. If the indexes can hold their gains this week, especially the Dow, then the market will be looking at double-digit gains for the year.
As we head to press, Dow futures are down 45 points; S&P 500 futures are lower by 5; Nasdaq 100 futures are off by 7 points. Subscribers, check the Members Area for the updates.
Tags: bear market, binary options, bull market, call option, how to trade options, Momentum stocks, option investments, option picks, option trading, options mentoring, options trading service, put option, stock market, stock market options
Posted in Market Analysis, Market Commentary | Comments Off