Market Summary (continued)
The week saw new highs or higher highs through Wednesday on all the indices followed by a modest test to end the week and the month. That leaves the indices set up quite well for a new upside move to start the new month.
Oh yes, the new month. September. The month most associated with losses. Well, in 2017 SP500 rallied 48 points (1.9%), NASDAQ 1%. Didn't tear the cover off the ball thanks to a late month dip, but hardly living up to September's unsavory reputation.
Of course, whenever the market rallies for as long as this one has and is punching out new highs, the worry is about market tops. Not without reason. The economy is strong with 4.2% Q2 GDP and the Atlanta Fed calling for 4.6% this quarter. Yet, the recent data has softened. I believe it is just a soft spot in the expansion, but of course the doom websites and authors are saying we are at a 2000 and 2007 type of top.
Some headlines today from those sites:
'The decoupling has never been greater'
'Once the bubbles pop, we're all broke'
Typical daily headlines. What most people do not know and what is bandied about by the global elite -- and even discussed by some great true economists such as Milton Friedman -- is the ultimate fix, the ultimate reset button, if it becomes necessary.
Read "The Daily" Entire Weekend Summary
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A break to new highs or higher highs on all indices pushed our positions to initial targets or beyond. That allowed us to take some nice gains.
AMZN (Amazon.com, Inc.)
Picked up this position 8/23 with some NOV $1905.00 calls for $112.40 as AMZN bounced off a near support test. Sold some 8/30 at $164.00, banking 45+%.
GRUB (GrubHub Inc.)
Picked up this position 8/2 for $127.77 along with some December $130.00 strike calls for $12.65. Hit the initial target 8/27 and sold some for $138.15 (8+%) and $18.40 (45%).
MYGN (Myriad Genetics, Inc.)
Bought this 7/19 for $43.72 and some NOV $44.00 calls for $4.80. The stock finally moved again just over a week back. Nice move, but then it stalled out and just drifted. Got tired of waiting, sold the stock for $49.45 (13%) and the options for $7.1 (48%).
NEPT (Neptune Technologies & Bioressources Inc.)
A stock play we picked up 8/21 at $3.31 and banked some gain 8/29 at $4.1, 23+%.
OMER (Omeros Corporation)
Picked up this position on 7/26 but it was a volatile ride at times. OMER recovered nicely, however, and on 8/30 we sold some stock for $24.88 (12.5%) and the SEP $21.00 call options for $4.1 (28%). Happy to get a gain after the volatility.
ROKU (Roku, Inc.)
Picked up this position 8/16 as it broke higher off a test, buying stock at $57.91 and some October $55.00 options at $6.42. Sold 8/27 for $62.4 (7.75%) and $10.00 (55+%).
SQ (Square, Inc.)
12.8% stock, 77% options, letting the rest run.
TJX (The TJX Companies, Inc.)
Bought into TJX 7/19 for $97.26 and some October $95.00 strike calls for $5.40. Took some time but sold some 8/30. Sold some stock for $108.32, an 11% gain. Sold some of the calls for $13.80 a 155% gain.
V (Visa Inc.)
Picked up this position 7/17; it took awhile. Bought SEP $140.00 calls for $4.60. Finally able to sell some 8/30 for $7.15, a 55% gain.
VRSN (VeriSign, Inc.)
Originally bought on 7/2 and took some gain before. Stocks at $129.98 and SEP $140.00 calls for $7.80. On 8/30 we cashed in more of the options for $17.80 (128%) and some more stock for $157.20, a 12.3% gain.
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Playing stock splits can be very profitable, but it takes know-how. Our stock split service focuses on three main types of plays:
1) pre-announcement (where we forecast an upcoming split prior to the company making the announcement); 2) pre-split (these plays are made in the days leading up to the actual split day); and 3) post-split plays (plays made after the actual stock split where the stock is showing continued or renewed strength).
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Here's a post-split play and our current analysis.
STATUS: Double bottom w/handle. Sure NFLX split in 2015 at a price over $700; indeed, it may want to announce a split at a lower price (the prior split was 7:1). We are willing to play NFLX as it recovers here, split coming or prior or no. NFLX put in a double top spanning June into July, then gapped lower on its earnings miss. The stock has been in purgatory since, putting in a lower low 2 weeks back, undercutting the late July low. MACD put in a bit higher low suggesting momentum turning upside. NFLX broke upside and rallied to the 50 day SMA as of Monday, moving on good volume. Spent the entire week working laterally at the 50 day SMA on light trade. Okay, we will wait and see if NFLX can give us a breakout upside from this 8 week base. Want to see it make the break and make it stick and we move in.
Volume: 7.943M Avg Volume: 12.376M
BUY POINT: $371.45 Volume=17M Target=$419.85 Stop=$355.45
POSITION: NFLX NOV 16 2018 370.00 C - (53 delta) &/or Stock
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XON (Intrexon--$15.38; +0.16; optionable): Biotech
STATUS: XON is in a continuing downtrend but it has a repetitive pattern. It will form a rounded bottom, rally nicely off it, then stall out and form a new rounded bottom. XON formed a low in late 2017 then broke higher March 2018 through mid-April. That was the peak and now XON has faded and formed the same kind of pattern along the 200 day SMA. XON moved up through the 200 day SMA just over a week back, peaked with a doji Wednesday, and tested back into Friday, holding over the 200 day. Okay, this is the setup where XON rallies nicely. This time it might even breakout because it has moved over the 200 day SMA. If so, great. For now we want to play that surge upside if it comes and take what it gives us. If more, great. First, however, needs to make an upside break on some volume to give us the entry for a run to fill a gap lower from early May.
Volume: 533.407K Avg Volume: 1.036M
BUY POINT: $15.77 Volume=1.2M Target=$18.85 Stop=$14.72
POSITION: XON NOV 16 2018 15.00 C - (63 delta, low OI) &/or Stock
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--by the MarketFN STG Team
URI (United Rentals, Inc.)
Our Success Trading Group members scored another winning trade this week when we closed out a position in United Rentals, Inc. (Ticker: URI). We currently like Walmart, Inc. (Ticker: WMT) at its current price for new positions.
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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AMSWA - American Software, Inc. is currently trading at $17.98. The October $17.50 Calls (AMSWA20181020C00017500) are trading at $0.90. That provides a return of about 6% if AMSWA is above $17.50 on expiration Friday in October.
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Stock Split Report: Forbes.com Best of the Web
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The Daily: "The Daily" is a must read for all investors!
Success Trading Group: 7 years without a trading loss!
| 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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