Market Summary (continued)
This time SP500 and DJ30 actually closed positive while the leading growth stocks and their primary indices (NASDAQ, RUTX) sold for a second session.
It was not a large cap NYSE surge nor was it a growth stock purge. Sure volume was huge, but that was due to an annual Russell adjustment. Perhaps it was the start of some new rotation, but the moves to end the week were not enough in themselves to show a change in investor tastes. The moves left several important stocks at near support after two downside sessions, making this coming week an important one for the growth areas, but more generally the direction the market takes from here.
SP500 5.12, 0.19%
NASDAQ -20.13, -0.26%
DJ30 119.19, 0.49%
NASDAQ -20.13, -0.26%
NASDAQ 100 -0.28%
VOLUME: NYSE +180%, NASDAQ +45%. Okay, cannot read much into this given the yearly Russell indexes 'adjustment.'
ADVANCE/DECLINE: NYSE +2:1, NASDAQ +1.2:1. The breadth shows Friday was more of a large cap event where the big names that led higher sold back for a second session while some NYSE large caps moved up and some new areas rebounded such as energy. Yes, there is some shifting in tastes ongoing. Again, that makes this coming week important directionally, and more specifically for particular groups, some up, some down, or perhaps more money comes in and the market finally moves up together.
I think that may be the key. While many Thursday and Friday talked of the market rolling over, of course they were myopically focused on just the stocks that moved higher. I think Thursday perhaps threw a curve: while growth stocks sold back from highs, other areas did not move higher, indeed continued sliding. That meant market rolling over.
Read "The Daily" Entire Weekend Summary
Watch Market Overview Video
Watch Technical Summary Video
Another good rally for growth into early Thursday provided more opportunity to take gain.
EXAS (EXACT Sciences Corporation)
A great breakout in late May, EXAS gave its first test the second week of July. As it came off the 10 day EMA test, we picked up some stock for $65.17 and some July $65.00 strike call options for $4.00. EXAS enjoyed a good move, not backtracking at all. We banked some gain on 6-19 as EXAS had tried higher but started to stall. After a good move that is a sign to bank some gain. We sold some stock for $69.77 and a 7% gain (so-so), sold some options for $6.3, banking 57% (decent).
ROKU (Roku, Inc.)
We saw ROKU making the turn back up in its base that formed after the peak in December 2017. It made us great money the first time so we wanted some on this base. Bought some stock 6/5 for $39.98 along with August $38.00 strike calls for $5.75. On 6-19 ROKU hit the initial target. We sold some stock for $46.15 and a 15% gain. Sold some of the options for $9.40, banking 63%.
FB (Facebook, Inc.)
Bought into FB August $185.00 strike call options on 5/23 for $10.75. FB had sold back, gapped lower and then reversed that day. We let FB work through a test in early June that held the 20 day EMA. After that it really picked up speed. Wednesday 6/20 it gapped higher in pretty much the euphoria day of the June move. We sold the calls for $20.15, banking 87%.
GALT (Galectin Therapeutic)
Bought into GALT at $4.76 as it broke out from a 5 month triangle. It worked laterally into early June, then took off upside. It was pretty much a straight shot so we let it work. On 6/20 we sold stock for $7.95, banking 67%.
GOOG (Alphabet Inc.)
We picked up some August $1135.00 call options at $47.00 on June 11 as GOOG jumped off a nice 1-2-3 test of the new break higher from late May. It was good timing as GOOG ran nicely higher into Wednesday last week. It punched a new high that day and started to reverse. We sold options for $72.40, banking 53%.
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Here's a leader play and our current analysis.
STATUS: APC gapped higher Friday and rallied on a very strong shot of volume -- a breakout, but was it due to rebalancing? The move took APC over the December 2017/January 2018 peak and out of the 19 month base. Impressive break. As APC continues we want to pick up the position with some stock and options. A move to the initial target lands 140%ish option gain, 15%ish stock gain.
Volume: 11.491M Avg Volume: 4.784M
BUY POINT: $74.41 Volume=5.2M Target=$84.97 Stop=$70.52
POSITION: APC AUG 17 2018 75.00 C - (50 delta) &/or Stock
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IQ (iQIYI--$36.29; -2.54; optionable): Chinese online video platform
EARNINGS: Earnings date not confirmed
STATUS: Exited the last part of the position Friday after IQ made us a very nice profit. Wanted to be cautious but also want to be in on a good stock when it makes its next move. So, we are looking at a new position if IQ can hold the 20 day EMA test and rebound. It likely will put in another day of testing and perhaps show a doji with tail that undercuts the 20 day EMA but then rebounds intraday. Then a good break higher off that is the entry.
Volume: 52.595M Avg Volume: 21.6M
BUY POINT: $38.14 Volume=35M Target=$45.89 Stop=$35.47
POSITION: IQ SEP 21 2018 40.00 C - (50 delta) &/or Stock
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HSY (The Hershey Company)
Our Success Trading Group members will be looking to enter new positions next week. We have many stocks on our radar including The Hershey Company (Ticker: HSY) and Axis Capital Holdings Ltd.(Ticker: AXS).
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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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WIRE - Encore Wire Corp. is currently trading at $50.25. The August $50.00 Calls (WIRE20180818C00050000) are trading at $2.30. That provides a return of about 6% if WIRE is above $50.00 on expiration Friday in August.
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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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