Posts Tagged ‘WMT’

Weakening Wednesday – Can Yellen Save the Day?

SPY 5 MINUTEI told you so!  

All of last week, I kept saying the market was only hitting highs because it was being manipulated that way and, by Friday we'd had enough and took our ill-gotten gains off the table once again.  This week, it's obvious we're in trouble – but it's a lot harder to sell your stocks when they're already in trouble, isn't it?

It's a very hard discipline to take winners off the table but you should scale out of posiitons on the way up the same way you should scale into them on the way down (and the Strategy Section at Philstockworld has a great article about scaling – also lots of additional commentary in chat below the article).  

There's nothing wrong with being in cash.  Yesterday, from 1pm until 2:30, we had on of our Live Futures Trading Workshops (replay available here) and our 4 trades made $360 by the close (4pm) for a very nice $100+ per hour salary for just trading a few contracts.  Our trade idea from yesterday's morning post (which you can get delivered to you pre-market, every day by SUBSCRIBING HERE) was to short the Nikkei (/NKD) at 14,350 and this morning we hit 14,050 – good for a $1,500 PER CONTRACT profit!  

SPX WEEKLYThat's one of the things you can do with cash.  We also have fun making earnings plays, like the FSLR trade we added to our Short-Term Portfolio yesterday.  That trade idea was:

I think it's worth a try at selling 5 July $75 calls for $3 ($1,500) and buying, to cover, 4 Jan $77.50/85 bull call spreads at $2 ($800) for a net credit of $700 – let's do a set of those in the STP

If FSLR is under $75 (it's about $69 after earnings), we pocket $700 PLUS whatever value remains on the January bull call spread (probably about half).  That's against zero cash outlay ($700 credit, in fact) and possibly we'll just take quick money off the table…
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Order From Walmart Sparks Heavy Options Activity On Plug Power

An order from the world’s largest retailer energized shares in Plug Power Inc. (Ticker: PLUG) on Wednesday, sending the stock up nearly 20% to $4.64 during the first half of the trading session on heavy volume. The company confirmed in a press release today that it received a multi-site GenKey purchase order from Walmart (Ticker: WMT) to power electric lift truck fleets at six North America distribution centers. Shares in PLUG are up a whopping 3,700% since this time last year.

Options volume on PLUG is more than two times the stock’s average daily volume as of midday in New York, with upwards of 19,000 contracts in play versus an average reading of roughly 8,100 contracts. Trading in calls on Plug Power is outpacing that in puts, with the call/put ratio hovering near 6.5 as of the time of this writing.

Some traders appear to be looking out to options expiring in January of 2015 to position for the price of the underlying to extend its run. Roughly 3,200 of the Jan’15 5.0 strike calls changed hands this morning against open interest of just 209 contracts, with time and sales suggesting much of the volume was purchased at a premium of $1.35 each. The bullish trade makes money if shares in Plug Power rally another 36% over today’s high of $4.64 to exceed the effective breakeven point at $6.35 by January expiration. Shares in PLUG last traded above $6.35 back in April of 2011.


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Sizable Ratio Call Spread Drives Up Volume In Ford Options

 

Today’s tickers: F, YMI & WMT

F - Ford Motor Co. – What appears to be a large one-by-three ratio call spread on Ford suggests one options market participant is looking for sizable, albeit limited, gains in the price of the automaker’s shares during the next five weeks. Ford Motor Co. shares are currently up 0.45% at $11.54 as of 12:55 p.m. ET. It looks like the options player purchased 25,000 calls at the Jan. 2013 $12.5 strike for a premium of $0.12 apiece, and sold 75,000 calls up at the $14 strike at a premium of $0.02 each. Net premium paid to establish the position amounts to $0.06 per contract and may be profitable in the event that Ford’s shares rally 9% off the current price to exceed the effective breakeven point at $12.56. Maximum potential profits of $1.44 per contract are available on the spread should shares in Ford jump more than 20% to settle at $14.00 at expiration next year. Shares in Ford last traded above $14.00 back in July 2011.

YMI - YM Biosciences, Inc. – Shares in the drug development company are up nearly 80% today at $2.89 after Gilead Sciences, Inc. agreed to purchase the Canadian biotechnology company in an all-cash deal valued at $510 million or $2.95 a share. Traders who purchased upside calls on YM Biosciences ahead of the deal saw the value of their contracts rise sharply along with the price of the underlying shares this morning. YMI call selling in the early going may be the work of traders taking substantial profits off the table. Time and sales data for transactions in the Dec. $2.5 strike calls back in November suggests traders purchased most of the 2,043 open contracts for an average premium of $0.05 apiece last month. The sale of at least 1,600 now in-the-money Dec. $2.5 strike calls this morning for an average premium of $0.40 each may mean traders are banking hefty gains that amount to eight times the original investment. Open interest in YMI options is largest in the Jan. 2013 $2.5…
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Big Prints In XLF Calls See Upside In Financial Stocks

 

Today’s tickers: GME, WMT & LULU

XLF - Financial Select Sector SPDR ETF – Heavy volume in February expiry call options on the XLF this morning may be the work of one or more traders positioning for shares in the financials ETF to get back to highs last seen in February 2011. The price of the underlying fund in the early going slipped 0.85% on Friday to a session and 11-week low of $15.06 before positive comments from Congressional leaders in Washington sparked a strong midday rally in equities. Shares in the XLF reversed earlier losses and now trades up 0.40% on the session at $15.24 as of 12:50 p.m. in New York. Traders exchanged nearly 100,000 call options at the Feb. $17 strike by 12:45 p.m. ET versus previously existing open interest of just 4,391 contracts. It looks like the bulk of the volume was purchased at a premium of $0.10 per contract, setting call buyers up to profit at expiration should XLF shares rally 12% during the next few months to top the effective breakeven price of $17.10. Upside call buyers are perhaps looking for financial stocks to move higher in the event that positive talk at the White House this afternoon translates into positive action from lawmakers in the months ahead.

V - Visa, Inc. – Stocks bounced off morning lows at midday after Congressional leaders meeting with President Obama to tackle the impending fiscal cliff made conciliatory and positive comments to members of the press at the White House today. Traders buying weekly calls on Visa, Inc. earlier in the trading session are seeing the value of their positions increase sharply intraday as the stock moves higher with the market. Shares in Visa are up 2.3% at present to stand at $143.21 as of 12:15 p.m. ET. Upside call buyers looked to the weekly Nov. 23 ’12 expiry options in morning trading, picking up a couple hundred of the $140 strike calls at an…
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Finally Friday – Maybe Tomorrow the Markets Won’t Fall

Falling, falling, falling

That's all the markets have been doing lately.  As you can see from our Big Chart – it's been a pretty orderly sell-off according to our 5% rule with roughly a 4-5% drop during October with some consolidation, followed by a much steeper 4-5% drop after the election.

We're back to the point where we expect resistance at an 8% total drop as well as some bounce action where once again we'll be measuring for strong or weak bounces to determine whether or not we can get a turn again (our indicators kept us bearish last time).  Regarding the current action, I said to our Members yesterday in Chat:  

I think there is a lot of selling as people take capital gains while they can.  I think that it's very possible that it's going to be very difficult to get a proper rally into the end of the year because there are plenty of people waiting for a rally to take their gains, whether through timing or position.  The problem with this state of not knowing is it becomes prudent for people to hedge for the worst and, if someone had a 20% gain for the year and now it's 15% and they can take it off now and keep 12.75% (after 15% tax) vs possibly hitting another 5% drop and running down to 8.5% this year or possibly 7% (at 30%) if they wait until next year and there's no recovery (and the more the cliff looms the less likely recovery seems) then it almost doesn't make sense not to take the 12.75% and run.  So that's very possibly the selling pressure we see and it may continue to be relentless into the end of the year unless there is some sort of resolution or delay to the cliff. 

While we don't think the Fiscal Cliff will end up being a big deal – that doesn't stop others from panicking.  This week we've been scooping up positions they have been running away from but, if we're going to have another leg down – we'll be needing those disaster hedges (see Wednesday's post) to keep us out of trouble.  It doesn't take much to profit from a downturn, fortunately, when we use good hedges.  On Wednesday I suggested the TZA April $17/24 bull call spread for $1.40, selling the $14…
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GameStop Options Active On Earnings, Sales Of Call of Duty®: Black Ops II

 

Today’s tickers: GME, WMT & LULU

GME - GameStop Corp. – Shares in video-game retailer, GameStop Corp., increased as much as 6% this morning after the company forecast fourth-quarter earnings of $2.07 to $2.27 a share and posted better-than-expected third-quarter earnings ahead of the opening bell on Thursday. Reports the company sold more than 1 million copies of Call of Duty®: Black Ops II worldwide yesterday during a midnight launch of Activision-Blizzard, Inc.’s newest addition to their popular Call of Duty® franchise, also lifted shares in the name today. A down-day for U.S. equities took some of the wind out of GME’s sails by midday, however, with the stock currently up 2% on the session at $23.96 as of 12:35 p.m. in New York. A number of options traders appear to be selling December expiry puts on the stock, a strategy that pays off if the price of the underlying holds onto recent gains through year end. At-the-money Dec. $24 strike puts changed hands roughly 550 times versus previously existing open interest of 327 contracts, and it appears the volume was sold for a premium of $1.33 apiece. Put sellers keep the full amount of premium as long as shares in GameStop Corp. exceed $24.00 at expiration next month. Similarly, many of the 2,300 put options in play at the Dec. $23 strike this morning were sold by traders pocketing an average premium of $0.80 per contract. Heavier volume in excess of 5,000 puts changed hands at both the Dec. $20 and $22 strikes in the early going. Much of the volume traded to the middle of the market at premiums of $0.23 and $0.58 each, respectively.

WMT - Wal-Mart Stores, Inc. – The world’s largest retailer forecast fourth-quarter profit and sales below average analyst estimates during the company’s third-quarter earnings report ahead of the open this morning, pulling stock indexes lower and sending the price of its own shares down nearly 5% to $67.85. Shares…
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Bulls Snap Up Wal-Mart Weeklies As Shares Extend Gains

Options brief will resume June 4, 2012.

Today’s tickers: WMT, GNOM & ZNGA

WMT - Wal-Mart Stores, Inc. – Wal-Mart weeklies worked out well for some bullish traders this week. For example, buyers of the May 25 ‘12 $62.5 strike call on Monday paid an average premium of $0.64 apiece for options that are now worth more than four times that amount on their final day of trading ahead of expiration. Trading traffic in call options that expire next Friday suggests some traders anticipate this same strategy could pay off next week as well. The sharp rally in Wal-Mart’s shares since the New York Times published a report regarding a cover up of alleged bribery in the company’s Mexico operations indicates investors have largely shrugged off the news for now, with shares in the world’s largest retailer currently trading at their highest level in more than a decade. The stock has posted double-digit gains since mid May, and added another 0.65% today to touch an intraday high of $65.50. Bullish players positioning for further gains in WMT shares stepped in this morning and purchased more than 1,500 calls at the June 01 ’12 strike for an average premium of $0.69 apiece. Call buyers profit at expiration next week if shares in the retailer exceed the average breakeven price of $65.69. Wal-Mart’s annual shareholders’ meeting is scheduled to take place next Friday.

GNOM - Complete Genomics, Inc. – Options on biomedical company, Complete Genomics, Inc., have been humming with activity this week as shares in the name move sharply higher. The stock soared 42.5% to an intraday high of $3.32 this morning, taking gains in GNOM up to 101% since Monday. Call open interest levels in Complete Genomics have been on the rise this week, and some traders appear to have landed overnight paper profits on bullish positions established in the front month options. The number of open positions in the June $2.5 strike call increased more…
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Bullish Plays Crop Up In Consumer Staples ETF Call Options


Today’s tickers: XLP, WMT & SFLY

XLP - Consumer Stapes Select Sector SPDR Fund – Options activity on the Consumer Staples SPDR in the first 10 minutes of the session suggests one strategist is long-term bullish on shares in some of the largest and most well-known U.S. companies. Shares in the XLP are up 1.0% today at $34.11, just off the ETF’s record high of $34.42, as U.S. equities move broadly higher. The XLP’s top 10 holdings, which make up nearly 70% of the fund, include Dow heavyweights the likes of Procter & Gamble, Coca-Cola and Wal-Mart Stores. Coca-Cola, the fund’s second-largest holding, is up nearly 3.0% this afternoon after the Company reported better-than-expected first-quarter results. The long-dated options position established on the ETF this morning stands to benefit from substantial bullish movement in the price of the underlying over the next year and eight months to expiration. It looks like the trader responsible for the transaction purchased a block of 10,000 calls at the Jan. 2014 $37 strike for a premium of $0.89 apiece. Profits are available on the position at expiration if shares in the XLP climb 11.0% to top a new record high of $37.89. A couple of hours into the trading day the same-strike call expiring in January 2013 was purchased 26,600 times at a premium of $0.23 each.

WMT - Wal-Mart Stores, Inc. – The value of a sizable bullish bet initiated in Wal-Mart call options yesterday ballooned overnight, as shares in the retailer extend their run to the upside for a second straight day. Shares in WMT are currently up 2.05% at $61.81 as of 11:35 a.m. in New York, the highest since mid-February, on positive U.S. same-store sales data. On Monday, WMT popped up on our market scanners after a large…
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Call Buyers Drive Traffic In Meritor Options

 

Today’s tickers: MTOR, SWK & WMT

MTOR - Meritor, Inc. – Of the 18,255 open options positions on the supplier of parts for manufacturers of trucks, trailers and specialty vehicles, most are open call positions, with the stock’s call-to-put open interest ratio currently at 2.042. Call options on Meritor are active today, as well, with more than 50 calls changing hands on the stock for each single put option in play. The action in MTOR options this morning suggests one or more investors is preparing for shares in the Troy, Michigan-based Company to rally ahead of expiration next month. One catalyst for the bullish look may be Meritor’s upcoming second-quarter earnings report set for release ahead of the opening bell on May 2nd. The stock today trades 1.3% lower on the session at $6.88 as of 12:30 p.m. ET. Call open interest patterns indicate an influx of buyers starting in mid-March, with the trend continuing this morning. The biggest play in MTOR options today is the purchase of 1,000 calls at the May $8.0 strike at a premium of $0.20 apiece. Profits may be available on the contracts should shares in Meritor jump 19.2% to top $8.20 by May expiration. Much of the call open interest at surrounding strike prices in the May expiry appear to have been generated by buyers taking positions back on March 21st, when MTOR’s shares jumped 13.0% intraday to $8.46 after the Company reaffirmed its outlook for 2012 revenue and earnings forecasts. In the three weeks since, the stock has reversed gains, and then some. Needless to say, buyers of the contracts at the end of March paid far more than traders today, as evidenced by the 75.0% decline in May $8.0 strike call option premium from $0.81 apiece on March 21st to today’s asking price of $0.20 each.…
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Bullish Bets Build In Wynn Resorts Weekly Options

 

Today’s tickers: WYNN, CTRP, DTV & WMT

WYNN - Wynn Resorts, Ltd. – Weekly options on Wynn Resorts are humming with activity today on news the casino operator is cutting ties with principal shareholder and director, Kazuo Okada. Wynn is the biggest gainer in the S&P 500 Index this afternoon, with the stock trading 6.7% higher on the day at $120.24. Options activity suggests some traders expect the stock to extend gains on the news, at least through the end of this week. Feb. ’24 $120 strike calls printed the most volume of the weekly contracts, with some 2,660 lots changing hands against open interest of 204 positions. It looks like most of the $120 strike calls were purchased for an average premium of $2.04 apiece. Traders long the contracts stand ready to profit at expiration in the event that Wynn’s shares rally another 1.5% to surpass the average breakeven price of $122.04. Bullish activity spread to the higher Feb. ’24 $125 strike where around 1,100 call options were snapped up at an average premium of $0.50 each. Finally, fresh interest is building in far out-of-the-money contracts at the Feb. ’24 $130 strike where some 925 contracts traded against zero open positions. Most of the calls appear to have been purchased for an average premium of $0.16 each, positioning traders to profit should shares soar 8.25% to top the average breakeven price of $130.16 by expiration. Shares in WYNN last traded above $130.16 in November of last year.

CTRP - Ctrip.com International, Ltd. – Shares in China’s largest online travel site took a big hit Tuesday after the Company reported lower-than-expected fourth-quarter earnings on Monday. The earnings miss was followed by a number of analyst downgrades, helping drive Ctrip.com’s shares down as much as 10.3% to an intraday…
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Zero Hedge

Trump's $50 Billion Farm Deal Is Fantasy After Trade War Market Shifts

Courtesy of ZeroHedge View original post here.

Industry insiders have told South China Morning Post (SCMP) that President Trump's alleged $50 billion agriculture deal with China is merely a fantasy, used to stimulate his Farm Belt supporters ahead of an election year, and even used as a communication tool to drive the stock market to new highs. Still, the likelihood of it actually happening is very low.

SCMP notes that China has never confirmed the $50 to ...



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Phil's Favorites

What is an oligarch?

 

What is an oligarch?

Boris Yeltsin shakes hands with Russia’s most powerful businessmen in Moscow. AP Photo

Courtesy of Joel Samuels, University of South Carolina

With the impeachment hearings for President Donald Trump under way, several American diplomats and ...



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The Technical Traders

When Oil Collapses Below $40 What Happens? PART III

Courtesy of Technical Traders

This, the final section of this multi-part research article, will continue our exploration of the consequences that may result from our ADL predictive modeling system’s suggestion that Oil may continue to fall to levels below $40 over the next few months. 

In Part I and ...



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Biotech

Why telling people with diabetes to use Walmart insulin can be dangerous advice

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

 

Why telling people with diabetes to use Walmart insulin can be dangerous advice

A vial of insulin. Prices for the drug, crucial for those with diabetes, have soared in recent years. Oleksandr Nagaiets/Shutterstock.com

Courtesy of Jeffrey Bennett, Vanderbilt University

About 7.4 million people ...



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Insider Scoop

Glass House Group Appoints Graham Farrar As President

Courtesy of Benzinga

Glass House Group, a California-based cannabis and hemp company, earlier this week appointed Graham Farrar as president.

In his new role, Graham will oversee the company’s short and long-term business strategies, budgets and operations, and report up to Glass House Group CEO Kyle Kazan.

A long-time entrepreneur and an original team member of both Sonos (NASDAQ: SONO...



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Chart School

Dow Jones cycle update and are we there yet?

Courtesy of Read the Ticker

Today the Dow and the SP500 are making new all time highs. However all long and strong bull markets end on a new all time high. Today no one knows how many new all time highs are to go, maybe 1 or 100+ more to go, who knows! So are we there yet?

readtheticker.com combine market tools from Richard Wyckoff, Jim Hurst and William Gann to understand and forecast price action. In concept terms (in order), demand and supply, market cycles, and time to price analysis. 

Cycle are excellent to understand the wider picture, after all markets do not move in a straight line and bear markets do follow bull markets. 



CHART 1: The Dow Jones Industrial average with the 900 period cycle.

A) Red Cycle:...

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Digital Currencies

Is Bitcoin a Macro Asset?

 

Is Bitcoin a Macro Asset?

Courtesy of 

As part of Coindesk’s popup podcast series centered around today’s Invest conference, I answered a few questions for Nolan Bauerly about Bitcoin from a wealth management perspective. I decided in December of 2017 that investing directly into crypto currencies was unnecessary and not a good use of a portfolio’s allocation slots. I remain in this posture today but I am openminded about how this may change in the future.

You can listen to this short exchange below:

...



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Kimble Charting Solutions

Silver Testing This Support For The First Time In 8-Years!

Courtesy of Chris Kimble

Its been a good while since Silver bulls could say that it is testing support. Well, this week that can be said! Will this support test hold? Silver Bulls sure hope so!

This chart looks at Silver Futures over the past 10-years. Silver has spent the majority of the past 8-years inside of the pink shaded falling channel, as it has created lower highs and lower lows.

Silver broke above the top of this falling channel around 90-days ago at (1). It quickly rallied over 15%, before creating a large bearish reversal pattern, around 5-weeks after the bre...



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Lee's Free Thinking

Today's Fed POMO TOMO FOMC Alphabet Soup Unspin

Courtesy of Lee Adler

But make no mistake, if the Fed wants money rates to stay down by another quarter, it will need to imagineer even more money.

That’s on top of the $281 billion it has already imagineered into existence since addressing its “one-off” repo market emergency on September 17. This came via  “Temporary” Repo Man Operations money, and $70.6 billion in Permanent Open Market Operations (POMO) money.

By my calculations that averages out to $7.4 billion per business day. That works out to a monthly pace of $155 billion or so.

If they keep this up, it will be more than enough to absorb every penny of new Treasury supply. That supply had caused the system to run out of money in mid September.  This flood of paper had been inundati...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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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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