Your Almost Daily Bit of Wall Street Wit & Wisdom

“What is life but playing with time..?”
— Keith Richards

We’re heading up to LA for a few days to see our ‘kids,” celebrate our 31st Wedding Anniversary, and jam with the Stones!:-)

Their sound is timeless and always great to hear.  In my opinion, the old musicians are better than the old athletes; they can still play.

Investing is something done over time.  Speculators must be keenly aware of time.  Options are wasting assets, whose time decay accelerates over the last few weeks of their life.

In life, time truly flies.  We’ll be trying to slow it down a bit over the next few days, before we pick up the scrapings and get back to work.

Best regards and gold rings on ya,

Steve

Your Almost Daily Bit of Wall Street Wit & Wisdom

gold pan

Photo credit: Paperny Entertainment

“Finding winners, especially big winners, is a process of discovery.  The losing trades are an integral part of that process.”
— Peter Brandt, @PeterLBrandt

Our recommended call option on Barrick Gold (GOLD), triggered 06-17-19 at $85, traded this morning at $280, +229% in less than a month, with an always known and strictly limited risk!

If that’s the type of options action you’re looking for, subscribe to Options Hotline today.

Best regards,

Steve

Your Almost Daily Bit of Wall Street Wit & Wisdom

h/t Shutterstock

“We typically trade our beliefs about the market, and once we’ve made up our minds about those beliefs, we’re not likely to change them.  And when we play the markets, we assume that we are considering all of the available information.  Instead, our beliefs, through selective perception, may have eliminated the most useful information.”
— Van K. Tharp

You are the most important factor in your success.  Understand and overcome your biases.  Use a trading system that’s right for you.

I believe that mind, method, and money management are the cornerstones of your complete game plan for trading success.

FYI: Our latest option recommendation, on Barrick Gold Corporation (GOLD),  is trading +30% in one day on a 2% move in the underlying shares, with an always known and strictly limited risk!

That’s the Superleverage power of my method on display.

If that’s the type of options action you’re looking for, click here to subscribe to Options Hotline today.

Let me know if you have any questions.  My email never sleeps.

Good luck in your trading!

Best regards,

Steve

Your Daily Bit of Wall Street Wit & Wisdom

whipsaw

Two men whipsawing lumber in British Columbia circa 1898 h/t Eric A. Hegg

“Consolidations are traders’ markets, in both directions.”
— Steve Rhodes

Markets move between areas of support (demand) and resistance (supply).  In a large market consolidation, whipsaw action is not unusual.  It provides opportunity for nimble traders to profit from moves up and down.

Option buyers are the only ones who possess the Superleverage power of unlimited profit potential with an always known and strictly limited risk.

Good luck in your trading!

Best regards,

Steve

Let the Chips Fall

Micron stock chart

h/t stockcharts.com

Options Hotline Update, FYI: +140% in 2 months on Micron puts

This morning, financial news was blaring about continued US/China trade tensions pressing Tech stocks to the downside. The move lower in Micron reached our $33 price target (see 03-24-19 Options Hotline) and our readers received an email Profit Alert that we would consider the position closed.

The Micron July $40 put, triggered 03-25-19 at $3.00, traded 05-23-19 at $7.20, +140% in just under 2 months, with an always known and strictly limited risk!

That’s the Superleverage power of our method on display.

You can see on my daily candlestick chart of Micron (MU) above, subsequent to our recommendation MU had a quick decline and rebound.  Shares then settled into a consolidation, before breaking down, over the past few weeks, to our objective.

Over the years I’ve found that patience tends to pay.  If this type of options action is for you, subscribe to Options Hotline today.

Let me know if you have any questions. My email never sleeps.

Best regards,

Steve

The Superleverage Power of Call Options

Avengers Endgame poster

Avengers Endgame Chinese Poster h/t Disney/Marvel

Disney June $115 call

Options Hotline, March – April, 2019

The Superleverage Power of my method was on display this week, as Options Hotline subscribers multiplied their money with our call recommendation on shares of Walt Disney Co.

On Friday, DIS soared like Captain Marvel going full binary.  Following the unveiling of its streaming service, DIS rose 11% from the previous day.  This action helped shares reach our $130 per share price objective (see 03-10-19 Options Hotline and 04-12-19 Options Hotline Alert).

Our recommended DIS June $115 call, triggered 03-11-19 at $4.50, with DIS at $114, traded 04-12-19 at $17.00, with DIS at $130.  That’s +278% in a month, on a 14% move in the underlying shares, with an always known and strictly limited risk!

We’re always seeking to stay a step ahead of the crowd.  Here’s what it looks like on my daily candlestick chart for Disney:

Disney price chart

My daily candlestick chart for Disney, h/t stockcharts.com

So Sarnoff, what is Superleverage?

Continue reading

Your Daily Bit of Wall Street Wit & Wisdom

Captain Marvel poster

h/t IMAX

“If you can dream it, you can do it.”
— Walt Disney

In Friday’s trading, Disney shares soared like Captain Marvel going full binary.

Shares gained 11% after Disney unveiled its streaming service.  That move helped the stock price reach our $130 per share objective.

I emailed Options Hotline subscribers a Profit Alert closing our recommended position in the DIS June $115 call, triggered 03-11-19 at $450 and closed 04-12-19 at $1,700, +278% in a month, with an always known and strictly limited risk!

That is the power of Superleverage on display.

Enjoy a super weekend!

Best regards,

Steve

Your Daily Bit of Wall Street Wit & Wisdom

“A put might more properly be called a stick. For the whole point of a put — its purpose, if you will — is that it gives its owner the right to force 100 shares of some godforsaken stock onto someone else at a price at which he would very likely rather not take it. So what you are really doing is sticking it to him.”
— Andrew Tobias

Puts options are extremely useful for both traders and investors.  They can provide safety, but are also dangerous for those who don’t understand how they work.

Options (puts and calls) allow you to control a large amount of an underlying instrument (stock, index, or futures) with much less of your own money than you would need to buy or sell that amount outright.  Options give you the ability to profit from price movement up and down.

The buyer (owner or holder) of a put option has the right, but not the obligation, to sell a specific amount of an underlying instrument at a specified price (strike price) within a specified time (expiration).  Put buyers have unlimited profit potential with an always known and strictly limited risk at all times.  This is known as Superleverage.

The seller (writer) of a put option has the obligation to buy a specific amount of an underlying instrument at a specified price by a specified time.  Put sellers take in a limited return with unlimited risk.

The option price which buyers pay and sellers receive is known as the option’s premium.

Put options may be purchased by sensible speculators seeking to profit from down moves and investors looking for portfolio protection.  Put options may be sold by investors to earn instant income and to position to buy shares below their current market price.

Exchange-traded put and call options are powerful tools for traders and investors.

Understand their risks and rewards, then use them wisely.

Best regards,

Steve

 

Goodyear Deflated

Goodyear Blimp Deflated

Goodyear Blimp Deflated

Goodyear Tire issued an earnings warning and shares drove south.  Today the overall market extended its rally, albeit on light volume.  As I recently wrote, we may be approaching a turn.

When the market is up and the shares you’re watching are not, that is a sign of weakness.  The opposite is true, as well.  When individual shares are up in a down market, it’s a sign of their strength.

As you can see below, Goodyear literally left a skid mark on my daily candlestick chart.

Chart by Steven Sarnoff

Chart by Steven Sarnoff, h/t stockcharts.com

Continue reading