October 2013 | Members

 

 

1:00pm (EST) continued…

Special Notice:  We wanted to invite all of our Momentum Options Trading readers to an exciting new venture we have been working on.

In December 2012, we acquired NextOptions.com  – a successful options website with hundreds of subscribers and thousands of readers.  Our goal has been to get more coverage of our Weekly Wrap to give our research team the credit they deserve.  The newsletter has posted an amazing 84-5 Track Record since 2011.  We are 40-4 this year.

We offered NextOptions subscribers an incredible discount to stay with us through the transition and you have been well rewarded as we ave doubled a $10,000 trading account this year for the Weekly Wrap.  NextOptions subscribers, Thank You for your trust in us.  Current Momentum Options subscribers, Thank You for supporting us from the start.

We use a mixture of covered calls and stock trading ideas to make solid double-digit monthly gains and we have recently added LEAPs, straddle and strangle options trades with possible returns of 100% or more. (A recent LEAP call option trade returned our subscribers 198%).

We also profile one company a week and we cover a bevy of possible earnings trades and where we get our ideas for our Daily newsletter.  The Weekly Wrap contains the exact same official trade recommendations for both MomentumOptionsTrading.com and NextOptions.com so there is no difference between the 2 sites except for some of the Daily content.

We are also giving away one American Eagle Silver coin a month by guessing the Dow.  Details are on the NextOptions.com website and it does not cost anything to enter.

 

You will need to have your entry on where the Dow will close at the end of NOVEMBER by October 31 by midnight.

We also have a 2-week subscription option for the Weekly Wrap at $59.95.  We have discounted this by 50%.  Use this coupon

SAVE-50

For the discount, go here:

http://nextoptions.com/subscribe-2/

This coupon code works for all subscriptions options so you can upgrade to longer terms to save even more!  We only run this offer once a year so we urge you to get on board during the special offer.  Current subscribers can UPGRADE their memberships as well.

For current MomentumOptionTrading Weekly Wrap readers, you can still keep your subscription with us but you will have to visit NextOptions.com to enter the monthly contest to win a shiny silver dollar.

If you have amy questions, please feel free to email or call us.

We will have some new trades for the Weekly Wrap, including a possible new one this afternoon.  We encourage you to come join us and at least try us for 2 weeks for under $30!

Special Notice:  You DO NOT have to be a subscriber to enter the Guess the Dow monthly contest so please tell your friends and family or forward this email to your buddies.  We have been extremely accurate in predicting the market’s moves all year long and you can use our weekly charts and commentary to help you learn how the market really works.

 

MEMBERS AREA

Do not risk more than 5% of your trading account on any one trade but do try to take ALL of the trades.  Please remember, ALL “Exit Targets” and “Stop Targets” are targets.  You should not have any “Hard Stops” entered to close any tradesor “Exit Orders” in your brokerage account unless we list one.  We will send out a “Profit Alert” or “New Trade” if we want you to close a position OR if a new trade comes out.  Otherwise, follow instructions at all times in the 9am and 1pm updates.  Also, we will usually give you a heads-up if we think we are going to send an email outside of these time frames.  Closed Trades for 2013: 122-62 – the Weekly Wrap is 40-4 for 2013 (84-6 since 2011) and is designed for traders that want to use options with less risk.

 

NEW TRADE!!!

DuPont (DD, $60.76, up $0.54)

Buy to OPEN December 62.50 calls (DD131221C00062500, $0.60, up $0.10)

Action:  The company just reported a great quarter and now that the announcement is out of the way and shares have cleared $60 there is a good chance $65 comes into play.  We like these options at current levels.

 

Current Trades

Boston Scientific (BSX, $11.54, down $0.75)

November 12 calls (BSX131116C00012000, $0.15, down $0.50)

Entry Price:  $0.55 (10/21/13)

Exit Target:  $1.10

Return:  -73%

Stop Target:  None

Action:  Our homework was spot on as the company reported a great quarter with earnings coming in at 17 cents a share versus estimates for 9 cents a share.  Revenue of $1.74 billion topped forecasts for $1.73 billion.  The company also said Q4 numbers would come in at 18-20 cents a share versus expectations for 13 cents and full year numbers of 70 cents a share versus expectation for 44 cents a share.

Of course this really doesn’t matter as shares are getting spanked.  It could be because their CFO is “transitioning” out of the role but these were fantastic numbers and why trading earnings can be frustrating.  Wells Fargo came out and said today’s weakness is a buying opportunity.  Duh.

The 50-day MA is at $11.59 so a close above this level would be good.  The 20-day MA is at $11.92.  If shares can close above either of these levels the trade still has a chance to be profitable.  We are also expecting the next 2 weeks to be bullish so hopefully a rising tide can give shares a lift before these options expire.

Our breakeven point is $12.55 so we are going to leave the trade open as we feel there is a really good chance shares recover.

 

Cliff’s Natural Resources (CLF, $23.45, up $0.03)

November 25 calls (CLF131116C00025000, $0.80, flat)

Entry Price:  $0.95 (10/21/13)

Exit Target:  $1.90

Return:  -16%

Stop Target:  None

Action:  Earnings are due out Friday and we would like to see a close back above $24 today going into earnings.

 

H&R Block (HRB, $28.80, down $0.07)

November 29 calls (HRB131116C00029000, $0.65, down $0.05)

Entry Price:  $0.45 (10/15/13)

Exit Target:  $0.90 (closed half at $0.80 on 10/23/2013)

Return:  53%

Stop Target:  60 cents

Action:  Shares have cleared $29 today but are flat as we head into the second half of trading.  We will likely close the other half on a drop below support at $28.  If so we can start watching the December and January calls as we still expect shares to clear $30 over the near-term.

 

Aruba Networks (ARUN, $18.66, down $0.40)

November 20 calls (ARUN131116C00020000, $0.30, down $0.15)

Entry Price:  $0.80 (10/11/13)

Exit Target:  $1.60

Return:  -63%

Stop Target:  None

Action:  Aruba has also been in a mini trading range this week as it battles $19.  A run above $19.50 would be bullish.  Support is at $18.50 but there is risk down to $18.

 

MGM Resorts International (MGM, $20.49, up $0.43)

November 21 calls (MGM131116C00021000, $0.50, up $0.15)

Entry Price:  $0.80 (10/7/13)

Exit Target:  $1.60

Return:  -38%

Stop Target:  None

Action:  We believe shares can make a run past $22-$23 by mid-November.  Support is at $20 with risk down to $19.50.  Earnings are due out on October 31.

 

Safeway (SWY, $35.77, up $0.19)

November 34 calls (SWY131116C00034000, $2.30, up $0.20)

Entry Price:  $0.80 (10/2/13)

Exit Target: $1.60 (closed a QUARTER at $1.10 on 10/11/2013, closed HALF at $2.25 on 10/23/2013)

Return:  151%

Stop Target:  $1.70, raise to $1.90 (Stop Limit)

Action:  We have raised the stop limit to $1.90 on the remaining quarter position.  Resistance is at $36 and shares have kissed $36.05 today.  Support is at $34.

 

Other 2013 Portfolio OPEN positions (0):  These are trades that are still open in the portfolio but are down over 50%.  They have longer expiration dates and are on “hold” but are not worth mentioning until they turn around.  This means we would not open any new positions.  We are still keeping track of the trades and we will record the results, accordingly, when we close them or if the options expire.  Click on the 2013Portfolio link in the Members Area to view ALL open/ closed trades.

 

WATCH LIST SECTION

These trades are NOT recommendations.  They are trades that we like but have not added to the portfolio as an official recommendation because of market conditions or because we are waiting for better entry prices.  We try not to have more than 12-15 open trades at any one time which is why we created a Watch List.  We will not list entry prices because these stocks are on the verge of breaking out or they could sell off but these are the trades we are watching as new candidates.

We will update this section in the morning.