ONE-TWENTY TWO: Trading Financial Markets
Since the year 2000, delivering a different narrative for students and fans of financial markets: stocks, options, currencies, Bitcoin, and more…
After falling as much as 15% this year, Goldcorp (GG), my favorite way to trade gold, has shot up 20%. The move through February was almost a straight line and the stock moved particularly strongly last week. *Chart created using TeleChart: While I sold the last of my trading positions in GG last week, this … Read more
Three and a half years ago, I concluded that options for Google (GOOG) should be sold, not bought, ahead of earnings. This advice seemed to generally apply ever since as GOOG tended to move just enough after earnings to devalue near-the-money calls AND puts. Friday’s 11% post-earnings pop was a rare, and impressive, exception to … Read more
Adobe Systems, Inc. (ADBE) was punished on Wednesday for an earnings report that produced guidance slightly below analyst expectations. The stock dropped as much as 26% after ADBE guided Q4 earnings to $0.48-0.54 EPS vs. $0.53 analyst consensus and Q4 revenues $950M to $1.0B vs. $1.03B analyst consensus (from briefing.com). The severity of the sell-off … Read more
With tongue reaching for the cheek last week, I declared the market both extremely undervalued and very overvalued, guessing that “as earnings season grinds on, I suspect the near-predictable pattern of post-earnings fades will finally wear thin, giving way to more bullish behavior.” I did not expect the turn to happen so clearly and dramatically … Read more
IMAX sold off almost 10% the day after heavy bullish trading on the stock’s options. This setback proved temporary as IMAX immediately turned around and set fresh 10-year highs on Monday. The chart below shows the recent action: *Chart created using TeleChart: The payoff on the calls has been tremendous so far. The March 15 … Read more
Interpreting the trading volume in options is typically difficult (I did an analysis in three parts last year). But I am most fascinated when a herd of speculators get caught leaning in the very wrong direction. This is what happened with IMAX. Schaeffer’s Research reported on heavy, bullish activity in the trading of IMAX options … Read more
At this point, everyone should be used to looking at charts of stocks and indices that look like they are topping out, many in climactic fashion (click here for a review of Caterpillar; click here for a review of Intel). Add healthcare stocks to the growing list. Specifically, the Health Care Select Sector SPDR ETF, … Read more
Over the past three days, the S&P 500 finally broke upward out of a five-week trading range (the NASDAQ has had a much more aggressive breakout). Well before this latest bullish move, many stocks and whole sectors soared higher in a “stealth” rally. Steel companies U.S. Steel (X) and Nucor (NUE) are two stocks in … Read more
I am always on the hunt for trading opportunities in solar stocks. For a third time, ReneSola (SOL) appears to be a long opportunity. My previous two attempts failed as I bought calls instead of shares. Purchasing shares instead of calls would have left me flat at this point. I am looking for a charmed … Read more
Soon after Google’s earnings I bought a November 570/580 call spread given that the year-over-year revenue growth rate finally seems to be turning around and revenue per employee looks ready to trend upward as well. I am finally getting around to explaining the move (as I promised to do) now that GOOG has reversed all … Read more