12:30pm (EST)
All systems go.
The bulls have pushed the market higher on better-than-expected earnings reports and another round of back-door deals gone public. Although volume is light, the major indexes have pushed through our targets from this morning which bodes well for the rest of the week and into the close of 2010.
The Dow is up 45 points, or 0.4%, to 11,523 while the S&P 500 is higher by 6 ticks, or 0.5%, to 1,253. We are looking for both to close above 11,500 and 1,250, respectively. The Nasdaq has hit our target of 2,660 which we said could be key for a continued rally and we would like to see a close above this level as well. Currently, the index is up 15 points, or 0.6%, to 2,665.
We covered a few earnings announcements this morning and we knew Adobe Systems (ADBE, $30.63, up $1.45) and Jabil Circuit (JBL, $19.45, up $1.79) would probably come in with good quarters. We were a little hesitant on pulling the trigger on a trade for Adobe but not Jabil. Our subscribers are currently up over 140% on JBL call options we recommended just one week ago.
We were also looking at a possible trade on CarMax (KMX, $32.37, down $3.53) which was at 52-week highs but we were looking at playing the downside. The company reported earnings in-line with estimates but shares sagged on concerns over gross margins.
CarMax reported a profit of $82 million in earnings, or $0.34 a share, on sales of $2.1 billion. Analysts had expected the auto reseller to post $0.34 a share on $1.97 billion in revenue. The “whisper” number was for earnings of $0.37 a share which could be another reason we are seeing an 8% dip in the stock price.
We did a “training video” for our option trading manual “How to Trade Options on Momentum Stocks” and we covered all three of these earnings plays. Although we only took one as an official recommendation, these videos are designed to show you step-by-step on how we find premium option trades.
Our subscribers have been giving us rave reviews on these videos as they are designed to give you a more in-depth look on our thoughts about the market and option trades we might be pursuing.
We are currently running a special deal where you can get both our Weekly Wrap newsletter and the option trading manual for FREE if you subscribe for a 1-year membership to the Weekly. We are also going to make another incredible offer to you today which will not be advertised on our website but we wanted to offer it to our current subscribers and to those of you who have been with us in the past because it is the holidays.
If you purchase a 1-year membership to our DAILY newsletter, we will give you a FREE copy of the option trading manual which includes a copy of our Momentum Stocks Watch List. This manual breaks down dozens of sectors and over 600 stocks which makes it easy to start setting up your own Watch Lists. Your subscription will include all access to our ongoing videos.
If you are serious about learning how to trade options for powerful profits in 2011 then you should really consider taking us up on this offer. It won’t last long and it will be good until the end of 2010. Again, we will not advertise this deal and we hope you take advantage of this special offer.
We will be back in the morning with another full update. Subscribers, check the Members Area for the updates and get ready to ring the register again…
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