Posts Tagged ‘DLTR’

Tempting Toppy Tuesday – 7th Time’s a Charm?

SPX WEEKLYWelcome back!  

Not just from your holiday weekend but welcome back to the top of the S&P as we attempt our 7th breakout of the year.  That's right, a month never goes by when we don't have a new rally that takes us back to the top of the channel, nor does a month go by when we don't re-test the bottom of the channel either – but let's ignore that as it's unpleasant.  

Interestingly, as you can see from Dave Fry's S&P chart, there have only been 9 positive weeks out of 19 in 2014 but oh boy did they make them count – with almost every one of them setting a new record – before the selling resumed.  Despite all these "records" being set, the average capital allocation strategy hasn't performed all that well in 2014, so far:

Thank goodness we're not pursuing any of those!  Thank goodness also that we didn't give our money to any hedge fund managers, as hedge funds are off to their worst start of the year since the Financial Crisis. Not listed here is our "Be the House – Not the Gambler" strategy, which we will be reviewing live today at 12:15 EST in a Live Webinar (sign up here for free). 

Selling risk to others in our Member Portfolios has given us 10%+ gains for year (so far).  In fact, the only strategy we agreed with from the above chart was gold, which we bet heavily (along with DBA) at the beginning of the year.  We were still knocking it out of the park in early May, with 40 of our 47 trade ideas in early may coming up winners already (see our May Trade Review).  

Remember, this isn't about making good picks, per se – it's about having a good strategy that gives you a high probability of success – even when you are wrong about a trade.   BEING THE HOUSE and selling risk (through options) to others is the closest thing we get to a "sure thing" in trading.  It's not fast, it's not sexy - but it works!  

Actually,…
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LinkedIn Corp. Calls In Play As Shares Rise To Record Highs

 

Today’s tickers: LNKD, DLTR & PZZA

LNKD - LinkedIn Corp. – Shares in the online professional networking company are soaring today, up as much as 7.0% to touch a record-high of $168.82 during the first half of the trading session on positive analyst comments. The price target on LinkedIn was raised to $200.00 from $160.00 at Evercore this morning, and the stock was rated new ‘Buy’ with a 12-month target price of $195.00 at Wunderlich Securities. LNKD shares, up nearly 40% in the past two weeks alone, have rallied more than 95% since this time last year. Options traders positioning for shares in the name to move higher this week snapped up in- and out-of-the-money weekly calls on the stock today. Traders looked to the Mar. 01 ’13 $160, $165 and $170 strikes, driving volume at each strike well above open interest levels. The $165 and $170 strike calls are the most active by volume, with upwards of 2,300 contracts in play at each as of 11:25 a.m. ET. Much of the volume appears to have been purchased at average premiums of $1.98 and $1.10 apiece, respectively. Meanwhile, nearly 1,000 call options have changed hands at the higher Mar. 01 ’13 $175 strike versus open interest of 250 contracts. Trading in the $175 calls is mixed, with roughly equal numbers of contracts purchased and sold. Buyers of around 350 of the $175 strike calls paid an average premium of $0.34 apiece in the early going, and may profit at expiration this week should shares in LNKD rally another 4.0% over today’s record high of $168.82 to surpass the average breakeven point at $175.34.

DLTR - Dollar Tree, Inc. – Upside calls purchased on Tuesday ahead of Dollar Tree’s fourth-quarter earnings report this morning landed one or more traders substantial overnight paper profits, with shares in Dollar Tree spiking nearly 14% to an intraday high of $46.71 on Wednesday morning. The largest increase in open interest on Dollar Tree overnight was in the Mar. $42.5 strike calls; a review…
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Put Options Eye Fresh Lows For Groupon

 

Today’s tickers: GRPN, DLTR & CHS

GRPN - Groupon, Inc. – Shares in Groupon are up 11.11% at $11.00 today on expectations the company may report better-than-expected first-quarter earnings after the final bell. Options on the stock are quite active as well, but not all of the positioning is looking for a positive earnings surprise tonight. Fresh interest building in the June expiry puts portends potential fresh record lows for the shares in the near future. One-by-two June $7.0/$9.0 ratio put spreads purchased this morning position traders to profit from limited bearish movement in the price of the underlying during the next five weeks. Of the more than 3,300 put options in play at the June $7.0 and $9.0 strikes, the largest blocks of options changing hands are the purchase of 486 $9.0 strike puts spread against the sale of 972 $7.0 strike options, done at a net premium outlay of $0.33 per contract. The ratio spread may be a profitable strategy should Groupon’s shares drop 21.1% to slip beneath the effective breakeven point at $8.67. Maximum possible profits of $1.67 per contract are available on the positions if shares in the name drop 36.4% to settle at $7.00 at June expiration. Groupon’s shares on Friday traded down to an all-time low of $9.63.

DLTR - Dollar Tree Stores, Inc. – Bearish options are in play on Dollar Tree, Inc. this morning ahead of the discount consumer goods retailer’s first-quarter earnings report on Thursday. Shares in Dollar Tree are currently down 1.5% at $101.05 as of 12:50 in New York. It looks like the investor buying a sizable debit put spread on DLTR this morning paid an average net premium of $3.31 per contract for a roughly 3,000-lot June $85/$100 spread. The position makes money if shares in…
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Bearish Signals Appear in Japan ETF Options

 Today’s tickers: EWJ, GIS, XING & DLTR

EWJ - iShares MSCI Japan Index Fund – A couple of bearish options trades on the EWJ caught our eye today with shares in the fund dropping nearly 2.0% at the start of the session to an intraday low of $10.42. Shares in the ETF pared some of the morning’s losses this afternoon, and currently stand 0.95% lower on the day at $10.53. The price of the underlying shares at $10.53 represents a 13.0% recovery off of the EWJ’s post-earthquake low of $9.24. One investor appears to have taken a medium-term bearish stance on the fund by selling calls to offset the cost of buying put options. The trader sold 14,250 calls at the June $11 strike for a premium of $0.31 each, and purchased the same number of puts at the lower June $10 strike at a premium of $0.44 apiece. Net premium paid for the spread amounts to $0.13 per contract. The investor profits if the EWJ’s shares decline 6.3% in the next few months to slip beneath the effective breakeven point to the downside at $9.87 by June expiration. Meanwhile, substantial volume in April contract calls today appears to be the work of an investor taking down one leg of a bullish risk reversal initiated last Tuesday. Around 105,000 calls sold today at the April $11 strike for a premium of $0.08 per contract. Most of the volume at that strike likely represents the closing sale of some 102,500 calls that were originally purchased last week. The original transaction involved the sale of 102,500 puts at the April $8.0 strike for a premium of $0.10 each, against the purchase of the same number of calls at the April $11 strike at a premium of $0.14 apiece. Perhaps the trader is less optimistic about the prospects for a near-term rebound in the price of the underlying fund today than he was eight days ago. Over 260,000 option contracts have changed hands on the EWJ as of 1:30pm in New York.…
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Optimist Enacts Bullish Risk Reversal on Dollar Tree Stores Ahead of Earnings

Today’s tickers: DLTR, SPWRB, VZ, AMKR, NXY, CMCSK, MYL, DELL & ZGEN

DLTR – Dollar Tree Stores, Inc. – An investor expecting shares in Dollar Tree to rally significantly by November expiration initiated a bullish risk reversal on the stock today with the price of the discount retailer’s shares up 2.55% at $43.10 as of 3:05 pm ET. It looks like the trader sold approximately 4,825 puts at the November $40 strike for an average premium of $1.30 each in order to partially finance the purchase of the same number of call options at the higher November $45 strike for an average premium of $1.60 apiece. The net cost of putting on the risk reversal trade amounts to $0.30 per contract. Thus, the investor is prepared to make money should Dollar Tree Stores’ shares jump 5.1% to trade above the average breakeven price of $45.30 by expiration day in November. The investor may also be making a bullish wager on DLTR ahead of the firm’s second-quarter earnings report scheduled for release before the opening bell on August 19, 2010.

SPWRB – SunPower Corp. – News that solar energy developer, Etrion Corp., agreed to purchase the two initial phases of Italy’s largest solar park from SunPower Corp. for roughly $63.5 million in cash plus debt today sent SunPower’s shares up as much as 5.4% today to an intraday high of $12.59. Shares are currently trading 4.25% higher on the day to arrive at $12.45 as of 3:15 pm ET. The move higher in the price of the underlying stock attracted bullish options players to the August contract. Investors hoping to see SunPower’s shares continue to appreciate ahead of August expiration purchased roughly 1,000 calls at the August $12.5 strike for an average premium of $0.50 each. Call buyers make money if SPWRB’s shares can rally another 4.4% to surpass the average breakeven price of $13.00 by expiration day. Other optimistic individuals sold 1,100 in-the-money puts at the August $12.5 strike to take in an average premium of $0.60 apiece. Put sellers retain the full premium enjoyed on the transaction as long as SunPower’s shares are trading above $12.50 through August expiration. Investors short the puts are ready and willing to have shares of the underlying stock put to them at an effective price of $11.90 in the event the put contracts land in-the-money at expiration day.

VZ – Verizon Communications,
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Long-term Put Play on Intel Provides Protection through 2011

Today’s tickers: INTC, FXI, UFS, TM, BRK.B, X, QCOM, MCO, APC, COST, HNZ & DLTR

INTC – Intel Corp. – Shares of chip-making giant, Intel Corp., dipped lower in early trading, but rebounded this afternoon to stand 0.75% higher on the day at $20.15. Long-term protective positioning in the January 2011 contract on the stock suggests cautious optimism by Intel-option traders. One investor purchased a put spread by picking up 5,000 in-the-money puts at the January 2011 $22.5 strike for a premium of $4.05 each, marked against the sale of 5,000 puts at the lower January 2011 $12.5 strike for $0.35 apiece. The net cost of the transaction amounts to $3.70 per contract. The trader responsible for the spread is likely long shares of the underlying stock. The spread, in this scenario, serves as an insurance policy on the value of the underlying position should Intel’s shares slip beneath the effective breakeven price of $18.80 in the next year to expiration. The investor is protected even if shares of the semiconductor chip producer collapse down to $12.50 by January of 2011.

FXI – iShares FTSE/Xinhua China 25 Index Fund – Shares of the exchange-traded fund, which invests in twenty-five of the largest and most liquid Chinese companies, are down 0.75% to $38.27 with just under one hour remaining in the trading session. FXI’s share price has declined nearly 15% in the past few weeks, from a 2010 high of $44.53 on January 6, 2010, down to an intraday low today of $37.89. One option trader’s actions in the March contract today suggest he has had enough of the downturn, and is looking for a sharp rebound by expiration in two months. The investor initiated a three-legged combination play using both calls and puts on the fund. It appears the main portion of the trade is a ratio-bullish risk reversal involving the sale of 5,000 deep in-the-money put options at the March $41 strike for a premium of $3.66 each, spread against the purchase of 10,000 calls at the same strike for $0.70 apiece. The purchase of 10,000 puts at the March $35 strike for $0.85 each rounded out the third leg of the transaction. The investor pockets a net credit of $0.56 per contract on the trade, which he keeps if shares rally up to $41.00 by expiration. Additional profits accrue to the upside if shares bounce 7.15% higher to…
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Bank of America Call Options Fly Off the Shelves

Today’s tickers: BAC, GE, SEED, EWZ, DE, STLD, LCC, SEED & DLTR

BAC – Bank of America – Long-term Bank of America bulls are out in full force today, scooping up call options like they’re going out of style. BAC’s shares are off slightly by less than 1% to $16.19. Plain-vanilla call buying in the January 2011 contract indicates investors expect shares to surge over the next 13 months. A large chunk of 50,000 calls were picked up at the January 25 strike for an average premium of 86 cents apiece. Shares must rally 60% from the current price to breach the $25.86 breakeven point on the trade. Twice as many calls were coveted at the higher January 30 strike where 100,000 calls were purchased for 45 cents each. The investor responsible for the massive position breaks even if shares jump 88% to $30.45 by expiration. Finally, another BAC-optimist established a ratio call spread in the same contract. The investor purchased 20,000 calls at the January 20 strike for 1.95 apiece, spread against the sale of 40,000 calls at the higher January 30 strike for 46 cents premium each. The net cost of the spread amounts to 1.03 per contract and positions the trader to profit if shares exceed $21.03 by expiration in January of 2011. Maximum potential profits available on the transaction amount to 8.97 per contract. Option implied volatility on Bank of America is currently 38.65% – a scant 2.93% above the 52-week volatility low of 35.77% – attained back on October 20, 2009.

GE – General Electric – A massive bullish bet on General Electric today indicates one investor expects shares to surge 43.8% in the next 13 months. Shares are currently up just under 1% to $16.16. It looks like a staggering 131,500 calls were purchased at the January 2011 22.5 strike for a premium of 76 cents per contract. The trader is apparently expecting GE’s shares to jump at least 43.8% to the breakeven point at $23.26 by expiration in January of 2011. Option implied volatility on General Electric is down to a one-year low of 29.46%.

SEED – Origin Agritech Ltd. – Frenzied options activity continues today on Beijing-based seed producer, Origin Agritech, following yesterday’s announcement that the firm received approval from China’s Ministry of Agriculture to sell its genetically modified phytase corn. Shares are currently up 4% to $10.86, down from an intraday…
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Buy Pick (or Short): DLTR

Buy Pick (or Short): DLTR

dollar tree dltr chartCourtesy of David at The Oxen Group

The Oxen Group is surprised by how much the market is not thinking about the earnings coming out on Wednesday morning from Family Dollar Stores Inc.  The Oxen Group believes these earnings could be a real market mover.

The Oxen Group is pretty bullish on Family Dollar earnings, but we have learned our lessons in the past from putting our hopes in earnings only to be disappointed. While we are excited about Family Dollar earnings, what we can say for sure is that Dollar Tree Inc. (DLTR) will move up or down with Family Dollar. If FDO beats expectations, we can expect Dollar Tree to significantly move up throughout the day. On the other hand, if Family Dollar does not beat expectations, Dollar Tree will most likely be an excellent short sale.

What we like about Dollar Tree over Family Dollar is that Family Dollar is going to bounce up or down right into the session, while the Dollar Tree should move slower. The market really could be moving on Family Dollar’s earnings, so if they are positive it could be a nice sign for the market. Further, crude oil inventories are supposed to come out lower than last week, which might be a piece that could actually make the oil market have a real reason to reverse its current direction.

The market seems to be almost perfectly following what energy is doing right now, and if inventories are good, it could further help the Dollar Tree move up on a bullish market. Technically, Dollar Tree is in a perfect position to move tomorrow on bullish news. The stock is extremely oversold, way too undervalued, and ready for a technical rise.

Entry: Enter 5-20 minutes into session.
Exit: 2-4% increase
Resistance: 43 or 39.50

 


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Phil's Favorites

Brexit deal flops, Theresa May survives -- so what happens now?

 

Brexit deal flops, Theresa May survives -- so what happens now?

Courtesy of Victoria Honeyman, University of Leeds

As the clock ticks down to March 29 2019, all of the political manoeuvring, negotiating, arguing and fighting is coming to a peak. In the two and a half years since the 2016 EU referendum, views on both sides have hardened and agreement still seems as far away as it was the day after the referendum.

With Theresa May’s withdrawal agreement disliked by all sides, and voted down by an unprecedented majority in the House of Commons, everyone is wondering what can and should be done next?

...



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Zero Hedge

Federal Workers Taking Odd Jobs To Make Ends Meet During Shutdown

Courtesy of Zero Hedge

Federal employees affected by the partial government shutdown are turning to various side jobs to make ends meet, according to the Associated Press

Some, such as immigration lawyer Cheryl Inzunza Blum of Tucson has been renting out a room on Airbnb for extra cash - capitalizing on the busy winter travel season in Arizona after she stopped receiving paychecks for her government contract work at a local immigration lawyer. She says she's working for free since she has clients who depend on her - some of whom are detained or have court hearings. 

Cheryl Inzunza Blum ...



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Kimble Charting Solutions

The "Average Stock" is Facing a Big Test Here!

Courtesy of Chris Kimble.

The Value Line Geometric Index tends to give investors a good idea of the health of the overall market. It is an equal-weighted index with a broad swath of stocks that gives investors an idea of how the “average stock” is performing.

The Value Line Geometric formed highs in the same area in 1998, 2007, and 2015 (see blue line). In the last two years, the index broke out above that line and held above it until the recent correction.

It is now testing the underside of that price area (now resistance). Bulls will get good news with a breakout ABOVE thi...



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Digital Currencies

Crypto-Bubble: Will Bitcoin Bottom In February Or Has It Already?

Courtesy of Michelle Jones via ValueWalk.com

The new year has been relatively good for the price of bitcoin after a spectacular collapse of the cryptocurrency bubble in 2018. It’s up notably since the middle of December and traded around the psychological level of $4,000... so is this a sign that the crypto market is about to recover?

Of course, it depends on who you ask, but one analyst discovered a pattern which might point to a bottom next month.

A year after the cryptocurrency bubble popped

CCN...



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ValueWalk

D.E. Shaw Investment Calls For Leadership Change At EQT

By ActivistInsight. Originally published at ValueWalk.

Elliott Management has offered to acquire QEP Resources for approximately $2.1 billion, contending the oil and gas explorer’s turnaround efforts have done little to lift the company’s share price. The company responded and said that a thorough review of the proposition is imperative in order to properly act in the best interests of shareholders, “taking into account the company’s other alternatives and current market conditions.” The news came only a month after Travelport Worldwide agreed to sell itself to Siris Capital Group and Elliott’s private equity arm Evergreen Coast Capital for $4.4 billion in cash and two months after Athenahealth was bought by Veritas and Evergreen for $5.7 bi...



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Insider Scoop

UBS Says Disney's Streaming Ambition Gives It A 'New Hope'

Courtesy of Benzinga.

Related DIS Despite Some Risks, Analysts Still Expecting Double Digit Growth From Communications Services In Q4 ...

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Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's chaotic presidency based on his high-conflict personality, which was evident years ago. This post, written in 2017, references a prescient article Bill wrote before Trump even became president, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

Reminder: We are available to chat with Members, comments are found below each post.

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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