9:05am (EST)
The futures are pointing towards another strong open this morning as the market looks to add-on to its fresh highs for the year. Dow futures are up 56 to 10,273, S&P 500 futures are up 7 to 1,099 while the Nasdaq 100 futures are up 15 to 1,788.
On Tuesday, the Dow closed at 10,246 and in Sunday’s Weekly Wrap we said the Dow could run up to 10,300-10,400 and that could easily be taken out this week if not today. We still think we are in a ”trading range” but it will really get interesting for the bulls if they are able to break through the resistance levels we talked about.
Gold continues to surge to new record highs…$1117/ ounce. We caught a little of that action with our Barrick Gold (ABX, $43.13, up $0.13) trade and the move in gold over the last few weeks has been astounding. It seems like yesterday we were under a $1,000/ an ounce…
Before we go this morning, we wanted to profile the Priceline.com (PCLN, $204.22, up $30.49) trade we posted in the Members Area last Friday. It has been a monster of a trade so far and it’s why we burn the midnight oil. Here is exactly how the trade appeared in the update (quotes are from LAST FRIDAY):
1:35pm (EST)
NEW TRADE!!!
Priceline.com (PCLN, $170.98, up $2.97)
Buy to OPEN PCLN November 200 calls (PNEKA, $1.10, up $0.05)
Set limit prices at $1.10-$1.15 to get in the trade but do not pay more than $1.25 for the calls.
The last time the company reported earnings the stock jumped from $130 to $150. We think Priceline.com is going to report strong Q3 results and a number of brokerage firms have recently raised their estimates and target prices.
This is an all-or-nothing trade as these calls will take a beating if the company misses earnings or the stock drops or even stays flat. We are going to need a HUGE move for the calls to make us a double but there is the chance we could get a 50% pop if the stock runs higher…” (END)
Folks, those same call options, the November 200 calls (PNEKA, $9.00, up $7.50) reached a high of $12 yesterday! That is nearly a 1,000% return if you were in at the bottom and out at the top.
Many of you wrote to us with great, funny and amazing results and we suggested leaving half positions open. The trade is pretty much over now as all we have to do now is manage the stop. Since we have already profiled the trade we thought we would share the update as well to give you a view on how we roll. This is exactly how the trade appears in our Members Area this morning:
Priceline.com (PCLN, $204.22, up $30.49)
November 200 calls (PNEKA, $9.00, up $7.50)
Entry Price: $1.10 (11/6/09)
Exit Target: $10.00 (closed half at $5.00 on 11/10/09)
Return: 536%
Stop Limit: $4, raise to $7.50
Action: Wow. Our jaws are still dropped…
We can’t tell you how excited we have been over the last 24 hours as many of you started writing to us at the start of yesterday’s opening bell. The huge returns some of you have banked on this trade have been fun to read. This was our biggest trade to date since we started MomentumOptionsTrading.com and it was our pleasure to bring it to you.
I wanted to take some time to explain how the return is set up. If you had bought 10 contracts it would have cost you $1,100. When our update went out yesterday the calls were at $5 when we said to close half. That gives you $2,500. The other 5 are worth $4,500 based on yesterday’s closing price. That gives you $7,000 off a $1,000 trade.
Now, as far as the stop limit. Wait to see where these calls open because we can possibly ride this one for further gains. The $7.50 stop limit can be put in place if the calls OPEN over that. If they open lower than $7.50 then you sell them at the open OR watch how they trade for a few minutes. Either way, don’t give back your gains if the call options continue to fall. The stock was up in after-hours last night but is currently down a buck in pre-market trading.
If you are a current subscriber, please check the Members Area for the rest of the trades. We will be back at 1:00pm with another market update…
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Intel/ AMD Kiss
Thursday, November 12th, 2009
12:50pm (EST)
Intel (INTC, $19.88, up $0.04) and Advanced Micro Devices (AMD, $6.51, up $1.19) have buried the hatchet after agreeing to end all outstanding legal disputes between the companies, including antitrust litigation and patent cross license disputes.
This was certainly a surprise and as you can see, investors think AMD benefited the most. And why wouldn’t they? Intel will also be reaching in its pocket to pay AMD $1.25 billion.
Intel was up over $20 earlier this morning but is pretty much flat while AMD is holding its 20% pop. Here is what the two companies had to say:
“While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development.”
Under terms of the agreement, AMD and Intel basically have a new 5-year cross license agreement deal and both parties will give up any claims of breach from the previous license agreement.
It would have been sweet to have gotten in the AMD November 5 calls (AMDKA, $1.50, up $1.09) YESTERDAY as they are up 265% today but don’t go chasing…
We were stopped out of our Wal-Mart (WMT, $53.57, up $0.60) trade this morning for a 17% profit but many of you wrote to say your returns were much better. Some of you made upwards of 50% which brings up a good point. We often get emails saying there is no way you can duplicate our portfolio results (which can be viewed anytime) but here is an example of where subscribers did make better returns.
It also happened with Priceline.com (PCLN, $199.77, up $2.97) as some of you made over 500%. So, see, it all depends on the market and what YOU feel comfortable with and what your exits and entries are.
Look, we are going to put you in a lot of good trades and everybody is going to have different results. Our goal is to make you money and you can never go broke by taking a profit. If you take profits you always have another trade and that is what we do. We trade and we don’t fall in love with a position.
The Dow is currently down 47 points to 10,243 as we head to press but we see some more trades on the horizon. Current subscribers, please check the Members Area for the update on Wal-Mart.
Tags: AMD, Intel, momentum options, MomentumOptionsTrading.com, option trading picks, options help, options mentoring, options track record, options trading, Priceline.com, trading options
Posted in Company Commentary, Earnings, Market Analysis, Mergers and Acquisitions, Option Trades | Comments Off