Market Summary (continued)
Expiration Friday, weak-ish economic data, three-day weekend, trade talks to continue in DC next week, ECB talking new QE, the notion the Fed is done hiking rates and reducing the balance sheet. Pretty much market nirvana, particularly for those areas that lagged for fear of trade and a slowing global economy. Heck, even for stocks tied to the domestic economy.
Futures posted a slow steady burn upside all pre-market, and stocks started upside, rallying for the first hour. A 4+ hour lateral stagnation (but no selling) then a sprint to the close the last half hour. That action fueled some strong gains and some not so strong gains. The spotlight focused on industrial stocks, financials, small caps. Even energy is showing signs of stirring. It was not techs or semiconductors, but those were hardly chopped liver.
SP500 29.87, +1.09%
NASDAQ 45.46, 0.61%
DJ30 443.86, 1.74%
NASDAQ 100 0.47%
VOLUME: NYSE -1%, NASDAQ +7%. Both exchanges posted average trade -- not blowout but solid enough ahead of a 3-day weekend.
ADVANCE/DECLINE: NYSE +3.5:1, NASDAQ +2.6:1.
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NVDA (NVIDIA Corp.)
Picked up positions ahead of the close and before the earnings Thursday. Bought April $155.00 calls for $11.40. NVDA beat and was up 13+ points afterhours. The gain was not as big when the market opened, but we sold for $15.10, banking 32%. Decent.
TREX (Trex Company, Inc.)
Picked up this position on 1/31 as the stock broke higher in a nice pattern. Stock at $69.51, March $70.00 strike calls for $4.50. A nice steady move higher into last week, hitting our target Tuesday. We sold half the stock for $77, banking 10+%. Sold half the options for $8.40, banking 85+%.
MU (Micron Technology, Inc.)
Bought MU on 1/24, buying stock at $36.69 and April $35.00 strike calls for $4.4. MU hit our target Thursday and we sold half the stock for $42.40, banking 15+%. Sold half the calls for $8.40, banking 90%.
CRM (salesforce.com, inc.)
Still had some February calls on a position taken at $144.17. Sold the last part Wednesday for $22.50 (bought at $8.80), banking 155%.
TECD (Tech Data Corporation)
Had some remaining February calls on this position taken at $81.40. Sold them Wednesday for $21.30 (bought at $5.10), banking over 300%.
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| 2) STOCK SPLIT REPORT |
Here's a pre-announcement play and our current analysis.
STATUS: Home-related stocks are showing new strength in this market, and HD is about as home-related as you can get. Friday the stock showed excellent strength, gapping through the 200 day SMA and rallying to close right at the session high. HD peaked in September, sold off into late December (nothing new there), forming an inverted head and shoulders from early November to late January. Nice breakout move Friday as it heads toward earnings a week from the Tuesday market reopening. We want to play a continued move higher toward the earnings with a target at the resistance from the summertime tops. That is a doable target ahead of earnings and lands a sold 80%ish gain on the call options.
Volume: 4.998M Avg Volume: 4.34M
BUY POINT: $192.64 Volume=4.8M Target=$203.96 Stop=$188.87
POSITION: HD APR 18 2019 190.00 C - (59 delta)
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CLF (Cliffs Natural Resources--$11.29; +0.04; optionable): Industrial metals
STATUS: CLF is a stock we should play more because it usually makes us money when it sets up. After peaking in September, a run that made us 15% on the stock and 150% on the options, CLF sold off in a steady drop to the late December lows. It has built back since, and the past week put in a nice flag test to the most recent move in its 5 month cup base. Yes, we should have been in earlier on this move, but if it can make us money now, we will take it. Testing back to the 10 day EMA in a nice flag, looking for a new break higher to enter for the next run. A move to the prior high lands 12.5% on the stock, but if industrial stocks are getting new money it can go higher. If not, we take a nice gain there. If it goes on by, of course we let it. A move to the target lands a 20%ish gain on the stock, 100+% on the options.
Volume: 11.678M Avg Volume: 11.423M
BUY POINT: $11.55 Volume=17M Target=$13.88 Stop=$10.78
POSITION: CLF APR 18 2019 11.00 C - (58 delta) &/or Stock
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LULU (Lululemon Athletica Inc.)
Our Success Trading Group members closed a winning trade on Lululemon Athletica Inc. (Ticker: LULU) this week when we traded in and out of LULU the same day. We have several stocks on our radar and are looking forward to trading next week..
Our Success Trading Group closed
7 years with 0 losses on our Main Trade Table. In fact, we closed 100% winning trades for the calendar years 2016, 2015, 2013, 2012, 2011, 2010 and 2009 (we still have 1 open position from 2017 (all others were winners) and 1 trade that we opened in 2014 was closed as a losing trade). All of these trades are posted on our Main Trade Table for your review during your free membership trial period.
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DKS - Dick's Sporting Goods Inc. is currently trading at $37.39. The March $37.00 Calls (DKS20190316C00037000) are trading at $2.20. That provides a return of about 5% if DKS is above $37.00 on expiration Friday in March.
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| The foregoing is commentary for informational purposes only. All statements and expressions are the opinions of Online Investment Services, LP., or Split Ventures, Ltd. This information is not meant to be a solicitation or recommendation to buy, sell, or hold securities. We are not licensed or registered in the securities industry. The information presented herein and on the related web site has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. The security portfolios of writers for this issue may, in some instances, include securities mentioned herein and on the related web site. Estimates, assumptions and other forward-looking information are subject to the limits of forecasting. Actual future developments may differ materially due to many factors. No one associated herewith receives compensation in any manner from any of the companies that are discussed in this newsletter or on the related websites.|
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