Tag Archives: Trade Tip

TEXT ALERT – This Stock Is Heading For New All Time Highs

We've seen it throughout this massive rally from our 2009 lows. Stocks keep hitting new highs, can today's text alert do the same?

I looked at the chart this morning and it looks to be holding longer term support. Analysts remain bullish on it, but we know we can't trust them much. It is all about what we see, what we feel, and what we know.

The stock has been pulling back since hitting all time highs last month. I think its poised to break those highs in the next few weeks. Currently I own the $910 calls, and if we get the move I think we are going to get they should be worth 200% or more from my entry price.


August 12th Watchlist

The markets are set to open the week lower, with stock futures currently down over .3%. Precious metals are higher, as are the miner etfs. The dollar is stronger as well as bonds, lets see if this trend remains intact. I am still looking for the next big leg down in bonds which should be very profitable when it happens. $AAPL is modestly higher with a September 10th date for the next Iphone release.

Barrons came out again this weekend stating their disdain for $TSLA at its current $155 price. They said the same thing earlier this year with TSLA at lower prices. They also thought $FB was a $14 stock. But they are right more often than not, and readers follow their advice, so look for TSLA weakness early this week.

Many upgrades and downgrades today:

$FFIV F5 Networks upgraded to Overweight from Equal Weight at Barclays
Barclays upgraded F5 Networks to reflect positive data points in networking, increased confidence in the new BIG-IP modules introduction, and the significant security opportunity. Price target raised to $107 from $89

$NTAP -->> NetApp price target raised to $50 from $43 at Brean Capital
Brean Capital raised its price target for NetApp after its channel checks indicated strengthening demand for the company's products. The firm believes NetApp shares can continue to appreciate into the company's August 14 earnings call.

$LNKD --->>

LinkedIn upgraded to Buy from Hold at Needham
Needham upgraded Linkedin based on growth opportunities that include the rollout of sponsored updates, mobile positioning, and international monetization. Price target is $280

$AAPL --->>

Apple price target lowered to $595 from $710 at Needham
Needham lowered its price target for Apple shares citing a more intense competitive environment since its last valuation update in February. The firm keeps a Buy rating on the stock

$BBRY --->> BlackBerry strength a selling opportunity, says Bernstein
Bernstein believes a full takeover of BlackBerry is unlikely given the current market capitalization and continued share loss in both the consumer and corporate markets. The firm believes today's news indicates ongoing operational issues and would use strength as a selling opportunity. Shares are Underperform rated

$FL --->> Foot Locker shares should be bought into Q2 results, says Sterne Agee
Sterne Agee believes that expectations are low for Foot Locker. Recent speculation that basketball and athletic footwear have lost popularity is unfounded, according to the firm. The firm expects the company to benefit from strong industry trends and share gains, and it keeps a Buy rating on the stock

$GOOG -->> Google cloud service a misunderstood part of company, says RW Baird
Baird believes Google's cloud platform is uniquely positioned to become the next large player in the cloud services market citing its application, platform and infrastructure services. The firm believes it is one of the least understood parts of the company and could be potentially larger than YouTube. Shares are Outperform rated with a $1,000 price target.

Some trades I am looking at for this week:

$TLT $107 weekly puts .30
$GOOG $905 weekly calls $1.10

FACEBOOK Bulls Buying Calls

Options traders are more bullish than ever on Facebook , even after a 57% surge over the past month.
The number of existing call options--contracts that benefit from a rise in shares--has soared to a record in the days since late July, when a surprise success in digital advertising revenues helped shares of the social media company trade above their initial offering price for the first time since the company's first day of trading.
"With the earnings report, Facebook showed it's actually a good company," said William Lefkowitz , options strategist at asset management and brokerage firm National Securities . "The stock has come back into favor, but some investors are still nervous, so are looking to options rather than buying the stock."
Facebook shares fell 0.5% to $38.68 Thursday. That is 1.3% below Monday's record close of $39.19 . At its IPO last May, Facebook shares sold for $38 . Last Friday, Facebook shares closed above the offer price for the first time since the launch.
When an investor buys call options, which grant the right to buy shares at a set price by a designated date, the maximum loss is the premium paid for the option no matter how far shares may fall.
As of Wednesday, there were 2.05 million call options outstanding. That number has grown 46% from last month's peak of 1.4 million contracts. The previous peak was 1.74 million call contracts, reached on Feb. 1 .
Stephen Burns , who manages a supermarket and runs an options trading blog from Nashville, Tenn. , started using weekly in-the-money call options after Facebook reported earnings on July 24 . At the end of last week, he moved his position into the follow week's options. As of Wednesday, he held $38.50 call options that expire Friday.
"I love the risk-reward of playing slightly in-the-money call options versus buying stock," he said. "The options are so liquid, and I get so much leverage with so little capital risk."
Mr. Burns said he had been interesting in Facebook's business model before its IPO, but the number of shares created at the time and the value of the launch kept him from buying. Facebook shares finished 23 cents above the $38 offer price in their first day of trading last year, before falling as low as $18.06 in August.
More than twice as many bullish call options traded Wednesday than put options, which profit from a decline in shares. Put options grant the right to sell shares at a set price by a designated date.
The most active options Wednesday included "in-the-money" options expiring at the end of the week, next week or in September. In-the-money call options have a strike price below the current market value of the shares. To profit, the stock must rise above that strike price plus the cost of the option.
The four most-actively traded Facebook contracts Wednesday were weekly $39 and $38.50 call options, August $39 calls and September $38 calls, according to options-data firm Trade Alert LLC . August options expire at the end of next week, while the September contracts expire Sept. 20 .
To be sure, the number of bearish contracts has seen growth as well, though at a slower rate. As of Wednesday, the ratio of bullish bets to bearish ones stood at 1.44 to one, according to Trade Alert data. That compares to a ratio of 1.33 to one a month ago. Yet, the number of puts outstanding remains about 18% below the peak of 1.74 million contracts seen last November, when shares were trading at $23.56 .
The option with the most contracts outstanding was January $25 put options, which grant the right to sell at that price, 36% below Wednesday's closing value. There were 185,906 contracts outstanding as of Wednesday, more than twice the next most active contract, January $32 call options. About 64% of those put contracts were opened prior to June.facebook

Why $AAPL Could Be Making New All Time Highs in 2013

I wanted to follow up on a video I recorded about $AAPL this weekend with the stock at $440. $AAPL is one of the most beloved and hated stocks right now. The stock had a ferocious rally from late 2011 until it topped out in September of 2012 at just over $700 a share. It then suffered a rather precipitous fall to under $380 a share in May. That low has held so far, but have we seen the lows for $AAPL or are more declines on the way. Can $AAPL recover the glitz and glitter it had in 2012 when it rose almost 100% or is the stock the next $MSFT or $CSCO, set to suffer years of anemic growth and meager gains?


Here is my video from this weekend, just in case you haven't seen it. http://stks.co/rM6v I quickly highlighted why I think $AAPL could be back at new all time highs before the year is through. I know its a very bold prediction but I think it is very possible.


I think $AAPL is just breaking out of an almost 10 month consolidation phase. The stock had a similar phase in 2007/2008 when the stock fell to the $70's and then rallied to over $700 a share. This phase brought $AAPL to $380 and I think the next rally, which could last several years, will bring the stock to new all time highs this year and over $1,000 a year or two from now. That's assuming the financial world doesn't collapse again before then.


The chart below shows the consolidation phase ending in 2008 (the blue circle) and the similar consolidation phase $AAPL is just about broken out of (blue circle). The green circle represents the type of short term rally that I think awaits $AAPL, its shareholders, and its CALL buyers.




For the next few months I am looking for a move like the one we saw in the winter and early spring of 2012 (the chart below covers that move). During that time $AAPL rallied some $200. That would put $AAPL back near its all time highs, a target that I think could get broken before years end.