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Friday, May 4th, 2012
1:30pm (EST)
We stayed up late again last night to watch the overseas markets open this morning but futures were flat as a pancake which offered us few clues on how Wall Street would open this morning.
Of course, we have been telling our subscribers today’s Nonfarm Payrolls would be crummy and we actually predicted a print of 115,000 sitting around the office yesterday. Coming into the week, we were thinking anything under 125,000 would put a halt to the current rally that had pushed the major indexes right to resistance and we also talked about how the market has been in a 5-week trading range.
The Labor Department reported that 115,000 jobs were added in April which was the smallest gain in six months. If the bulls had gotten a number above 175,000 perhaps we would be seeing new market highs for the year. However, we knew there was a good chance the major indexes would fall back into the lower end of the trading range and we are hoping for much worse.
The talking heads will try to spin the Unemployment Rate which fell to 8.1% but the real number for unemployment in America is probably 15% or more. Either way, the news was bad and Wall Street seems shocked.
Not us. We have been warning our subscribers of a market pullback and possible correction as we have been loading up on put options since the beginning of April.
It’s been a sweet week despite the tight trading range we have been in for over a month as we have been able to close 3 more winning trades. Our current closed trade win streak is now at 16-straight which brings our 2012 Track Record to 76-18 year-to-date.
This is an incredible 80% win rate trading options and most “professional” traders would sell their soul to get 55% right trading stocks. Options are much harder to trade because they are time sensitive and by Wall Street standards and for options trading, a 55% win rate would actually be a great compliment. We try to do better than that as you can see.
The Dow is down 160 points to 13,046 while the S&P 500 is off 121 points to 1,370. The Nasdaq is lower by 59 points and is at 2,965.
There are two key elections are over the weekend concerning France and Greece. There are new radical parties that could win seats and this could lead to more uncertainty.
We hope so because our current put option trades are exploding today. We have to cut it short because we have listed Hard Stops on a few trades to protect profits.
We also have a NEW TRADE we are getting into as soon as we send this out.
If you are not a subscriber, email us and we will send you a copy. If you are a current subscriber, please check the Members Area for the fresh updates.
We will be back Sunday night with the Weekly Wrap and if you still don’t believe us that this is still one of the BEST times to be trading options, then please take a look at our 2012 Track record. Your jaw is going to drop after you see the profits we have been racking up.
Tags: best options newsletter, put option trading
Posted in Hot Stocks, Market Analysis, Market Commentary | Comments Off
Friday, April 20th, 2012
2:30pm (EST)
We normally don’t like to open new trades on a Friday but there is one stock on our Watch List that continues to look like a great short and shares have just fallen below $35. Our 6-12 month target for this overvalued, overrated stock is $20. This means we are buying put options.
Subscribers, check the Members Area for the NEW TRADE!
The market is coming down off its highs as the Nasdaq is up by only 2 points to 3,007 but have slipped in negative territory. We would love to see a final hour selloff!
Tags: put option trading
Posted in Trade Update | Comments Off
Tuesday, March 27th, 2012
1:05pm (EST)
The market has remained in a tight range following Monday’s surge as mixed economic news has helped both the bulls and bears today. Headlines from across the pond have been relatively quiet but we are expecting news from Spain could be a pain later in the week.
As far as the numbers here at home, the Case/Shiller Home Price Index fell 0.8% while the Consumer Confidence report came in at 70.2, versus expectations for a reading of 70. The Richmond Fed Manufacturing Index came in with a print of 7, versus expectations for a reading of 18.
As far as stocks, Apollo Group (APOL, $39.78, down $3.42), a stock we love to hate on, is down 8% despite beating Wall Street’s estimates. The company reported a profit of $0.58 a share on revenue of $970 million versus expectations for a profit of $0.38 a share on revenue of $933 million. Overall degreed enrollment at the company’s University of Phoenix “campus” fell 12% while new enrollments were up 1%. However, Apollo Group said new enrollments could fall double-digits percentage wise for the current quarter.
Shares rallied to $58 earlier this year and at the end of February they fell from $51 to $43. We have talked about the company’s shady enrollment practices in the past but shares seem to trade to the beat of a different drum. Perhaps Wall Street is finally seeing the light as a couple of analysts have downgraded the stock today.
Although we were on the sidelines, we wished we would have placed the April 40 puts (APOL120421P00042000, $2.55, up $0.70) on our Watch List. The options are up 70% and could move further on a continued slide in Apollo Group’s stock.
No worries. We still have some nice pin going for our current trades.
As we head to press, the Dow is up 2 points to 13,240 while the S&P 500 is higher by a point to 1,417. The Nasdaq is showing a gain of 6 points to 3,129. We have profits to take on one of our current trades as we are closing HALF positions. The options are up 30% in just one day and the trade could be getting crowded. Subscribers, check the Members Area for the updates.
Tags: APOL, Apollo Group, put option trading
Posted in Earnings, Economic News, Hot Stocks | Comments Off
Thursday, March 10th, 2011
9:00am (EST)
The market had a lackluster Wednesday as the bulls and bears battled to basically a draw. Both sides made advances into enemy territory but trading was tight with the bears scoring a light victory when the closing bell sounded.
The Dow slipped a point to close at 12,213 while the S&P 500 fell 2 points and settled at 1,320. The Nasdaq was off by 14 points and finished at 2,751.
Yesterday was the 2-year anniversary of the stock market lows which were caused by the financial crisis that rocked Wall Street and the world. The S&P 500 is the most widely followed index and the benchmark for fund managers has doubled from its 2009 low of 667.
The rally has been amazing to say the least and this three week pause makes since if you step back and look at the run the bulls have had. However, the flip side of that coin is that look at where the market was.
When the market is stuck in a trading range it’s hard not to be emotional because you want the trend you were in to continue. As option traders, trading ranges are the one thing that we don’t like to see because options are time sensitive. However, you can offset this by using longer-term options. In fact, you can purchase options up to 2 years out. This helps keeping your emotions in check and as long as the story doesn’t change for your positions then it is easy to sit tight.
We mentioned that we expected a dull to flat rest of the week and the action from yesterday’s session backed that theory up. We have also seen higher lows from Monday’s test of 1,300 for the S&P and to a degree, higher highs. However, we did get our first Friday-Monday consecutive down days this past week which was the first time this has happened since early January.
Although the lower closes weren’t that major, we mentioned this because it can sometimes give you clues on if a trend is changing.
The current uptrend during this 2-year bull run started in mid-September and there were a couple of times in November where the market had a lower Friday and a lower Monday, but again, the losses were small and another run to new highs followed.
March options expiration week is usually pretty bullish and we are planning for a rally but we know the headwinds will be strong. Oil will continue to move the market but we are hoping the Middle East tensions ease and the “Day of Rage” on Friday by Saudi Arabia turns out to me a minor demonstration.
Tech could rebound on Apple’s (AAPL, $352.47, down $3.29) new release of the iPad 2 and if the Financial sector can continue to show some strength then we might be working with something. However, if the turmoil worsens and oil moves near $110, and Apple iPad sales aren’t as strong, then next week could be our sign the market has peaked for a while.
Futures are lower as we head to press, Dow futures are off by 59 points to 12,115 while the S&P 500 futures are lower by 8 points to 1,307. The Nasdaq 100 futures are down 15 points to 2,295.
Tags: AAPL, call option trading, put option trading
Posted in Apple, Market Analysis | Comments Off
Tuesday, January 19th, 2010
9:10am(EST)
Futures are mixed as we head towards the opening bell this morning. Dow futures are lower by 20, S&P 500 futures are off by 2 while the Nasdaq futures are up 4 points.
There was plenty of action in E*Trade Financial (ETFC, $1.84, up $0.11) last Friday as over 60 million shares traded hands. There was a report that the company is in “advanced” talks regarding a sale.
It’s hard to get excited about a company who once dominated the online brokerage industry and a share price at less than $2. From 1998 through 1999 this was one of the highest of flying stocks as two-for-one splits were common and shares made new highs daily.
There has been a lot of speculation as to who might buy the troubled brokerage firm but E*Trade has brand awareness which should account for some kind of premium. TD Ameritrade (AMTD, $18.32, up $0.10) and Charles Schwab (SCHW, $19.00, down $0.18) have been in the mix as possible acquirers of E*Trade but we really don’t see an option trade with this one.
Option volume was brisk and the stock already trades like one. However, we are avoiding options on stocks that trade under $5.00 because of the risk. That still didn’t stop traders from placing huge bets on the February 2 calls (EUSBF, $0.12, up $0.07) which opened at 4 cents and returned 200% by the closing bell. Over 10,000 contracts traded.
The April 2 calls (EUSDF, $0.20, up $0.05) traded 3,000 contracts after opening at 14 cents. Considering this has been an ongoing rumor for some time and the fact that it would be safer to buy the stock, these two call options could expire worthless if no bid comes. Stay away…
We have updated the Members Area for our current trades and there a few trades we are watching this morning. If we see something, we will send out an alert.
Tags: alternative investments, asset management, blog Wall Street, buying call options, buying put options, call option trading, Charles Schwab, chicken option trades, Covered Calls, E*Trade Financial buyout rumors, financial, financial investment, funds, future option trading, futures trading, gold investing, guide to investment, guide to options, guide to options trading, hedge fund, hedge funds, how to invest, income, index funds, index options, invest, invest money, investing for dummies, investing market, investment, investment advisor, investment management, investment services, investment strategy, investments, journal Wall Street, momentum stock option trading, mutual investing, new Wall Street, on Wall Street, online option trading, online trading system, option call, option exchange, option investment, option picks, option price, option selling, option trade, option trade picks, option trading online, options, options alerts, options blog, options expiration, options mentoring, options newsletters, options signals, options track record, options trade, options trading, options trading strategies, private equity, put option trading, Rick Rouse, software options, stock, stock exchange, stock investment, stock market, stock market options, stock option trade pick service, stock option trading, stock price, stock quotes, stock share, stock trading, straddle option trades, strangle option trades, strategies options, support and resistance levels, the Wall Street, trading, trading option, trading options, triple-digit option trades, wall st, Wall Street, Wall Street article, Wall Street blog, Wall Street history, Wall Street online, wealth management
Posted in Company Commentary, Market Analysis, Market Commentary | Comments Off
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Market Tanks on Nonfarm Payrolls
Friday, May 4th, 2012
1:30pm (EST)
We stayed up late again last night to watch the overseas markets open this morning but futures were flat as a pancake which offered us few clues on how Wall Street would open this morning.
Of course, we have been telling our subscribers today’s Nonfarm Payrolls would be crummy and we actually predicted a print of 115,000 sitting around the office yesterday. Coming into the week, we were thinking anything under 125,000 would put a halt to the current rally that had pushed the major indexes right to resistance and we also talked about how the market has been in a 5-week trading range.
The Labor Department reported that 115,000 jobs were added in April which was the smallest gain in six months. If the bulls had gotten a number above 175,000 perhaps we would be seeing new market highs for the year. However, we knew there was a good chance the major indexes would fall back into the lower end of the trading range and we are hoping for much worse.
The talking heads will try to spin the Unemployment Rate which fell to 8.1% but the real number for unemployment in America is probably 15% or more. Either way, the news was bad and Wall Street seems shocked.
Not us. We have been warning our subscribers of a market pullback and possible correction as we have been loading up on put options since the beginning of April.
It’s been a sweet week despite the tight trading range we have been in for over a month as we have been able to close 3 more winning trades. Our current closed trade win streak is now at 16-straight which brings our 2012 Track Record to 76-18 year-to-date.
This is an incredible 80% win rate trading options and most “professional” traders would sell their soul to get 55% right trading stocks. Options are much harder to trade because they are time sensitive and by Wall Street standards and for options trading, a 55% win rate would actually be a great compliment. We try to do better than that as you can see.
The Dow is down 160 points to 13,046 while the S&P 500 is off 121 points to 1,370. The Nasdaq is lower by 59 points and is at 2,965.
There are two key elections are over the weekend concerning France and Greece. There are new radical parties that could win seats and this could lead to more uncertainty.
We hope so because our current put option trades are exploding today. We have to cut it short because we have listed Hard Stops on a few trades to protect profits.
We also have a NEW TRADE we are getting into as soon as we send this out.
If you are not a subscriber, email us and we will send you a copy. If you are a current subscriber, please check the Members Area for the fresh updates.
We will be back Sunday night with the Weekly Wrap and if you still don’t believe us that this is still one of the BEST times to be trading options, then please take a look at our 2012 Track record. Your jaw is going to drop after you see the profits we have been racking up.
Tags: best options newsletter, put option trading
Posted in Hot Stocks, Market Analysis, Market Commentary | Comments Off