Navivest Stocks and Options Blog

Buying Devon Energy Calls

Jul 22, 2010 Options, Trading Idea

We’ve sent out a buy alert on the Devon Energy (DVN) August 62.50 calls to subscribers of our Options Capitalist service. We are looking for a continuation of the upward momentum in crude oil prices, which will be beneficial for energy stocks.

Tags: call option, devon energy

Technical Trader – Cummins Inc

Jul 21, 2010 Options, Stocks, Technical Analysis

Cummins Inc (CMI) is up $1.51 to $74.05, currently one of the strongest performers among S&P 500 stocks. However, the stock will form a double top if continues to advance and hits its next resistance area of $75. Traders might want to look at shorting the stock above $74.50 or selling call the September 85 calls, which are asking $1.20.

Tags: cummins inc, options writing, sell calls, Technical Analysis

Making Money Selling Options

Jul 16, 2010 Options

On June 25, we sent out a trading alert to subscribers of our Navivest Options Writer service, recommending they sell (write) the Goldman Sachs (GS) July 155 calls. From a technical analysis standpoint, we felt the stock would have a hard time clearing the $140 area and if that happened, $150 would also prove to be a strong resistance area as well, before the options expired, making the stock a very good candidate for writing options on. There was also the overhang of the fraud charges by the SEC over the company.

We got $2.04 for each call we sold and the recommendation proved correct, as through July 13, the stock never broke above $141.

Towards the end of the trading session yesterday, during the last thirty minutes, the stock started surging on word that the company had reached a settlement agreement with the SEC over the fraud charges and the stock ended up climbing $6.16 to close at $145.22.

After hours, the stock kept rallying, touching $152. Today, in early going, the stock is now at $149.55, up $4.33. With July options expiring today, even with the big gain in the stock, it looks unlikely that the stock will climb above $155 and get called away on us, making this another winner for the Navivest Options Writer service.

With 80% of all options expiring worthless, writing calls is a great way to put the odds in your favor when trading options, as highlighted by this trade.

Tags: goldman sachs, Options, sell calls, writing options

Buying FCX And SNDK Call Options

Jul 13, 2010 Options, Trading Idea

Markets are poised for a higher open. We are recommending subscribers to The Options Capitalist buy the Sandisk (SNDK) Aug 48 calls and the Freeport McMoRan (FCX) Aug 65 calls.

Tags: freeport mcmoran, options recommendations, sandisk

Profiting From The Wild Market Volatility

Jun 2, 2010 Options

With the stock market currently undergoing an extreme case of volatility, individual investors are no doubt very nervous and debating whether they should be in the markets at all. If you are a trader, the answer is yes you should be in the markets. For a trader, these are the best of times.

Yesterday, with the pre-market indicators suggesting that the Dow Jones Industrial Average would open lower by more than a hundred points, we sent out trades for the day to subscribers of our Options Capitalist service.

Being that we were going to be seeing major moves to the downside in individual stocks, we sent out three trades instead of our usual one, in case one opened outside of our entry range. The trades consisted of two puts and one call and with stocks looking to open much lower, we knew the puts would open much higher and we did not want to be shut out for the day. By sending out three trades we were hoping that at least one would pan out. As it turns out, we were able to get into all three.

The trades were the Freeport McMoRan (FCX) June 65 puts, which we got into at $1.70, the First Solar (FSLR) June 100 puts, which we bought at $2.25 and the Randgold (GOLD) June 90 calls, which we entered into at $2.95.

We were looking for a much lower close from where we entered, but at 2:50 PM, we sent out an exit alert to close out all the trades. Not all our subscribers use auto trading and we were worried that if we sent out the exit alert after 3 PM, some of our subscribers might miss the email before the market close.

We closed out the FCX puts at $1.87, the First Solar puts at $2.74 and the Randgold calls at $3.43, which gave us decent gains of 10-20% in the trades. Not bad for one day, thanks to volatility. Of course, just as soon as we exited, the markets fell off a cliff and had we been able to hold on, we would have had over 25% gains in the put trades. But we did want to be out to avoid an up day today and as it stands, in the early going, FCX and FSLR are up.

While the volatile moves are scary, traders willing to brave it, can make very good money.

Tags: first solar, freeport mcmoran, Options, randgold

Buy Stocks Today For Quick Intraday Profits

May 26, 2010 Options, Stock Market

Stock futures are indicating a higher opening, following yesterday’s dramatic action that saw the Dow Jones Industrials go from an open of 10,061.43, fall to a low of 9,774.48, but then close at 10,043.75, for a loss of just 22.82 points.

Today could present some opportunity for some quick intra-day profits on the long side for traders. We are recommending trades for today to subscribers of our services, telling them to buy a few minutes after the open if stocks open strong as suggested pre-market action. We also recommend taking very quick profits as the stock market has taken on a bipolar personality of late. We could open to the upside, but still see some major selling as the day progresses.

Option traders have a chance for even bigger profit opportunities. We should see big moves in select stocks that could mean 20% or more profits in the front month call options of those stocks.

Tags: market volatility, Stock Market, Stocks

Two Day Profits of 51% On Goldman Sachs Puts

Apr 30, 2010 Options, Trading Idea

On Tuesday April 27, we sent a buy alert out to subscribers of our Options Capitalist subscription service for options traders, recommending that they purchase the Goldman Sachs (GS) May 2010 145 puts. We entered into the trade at $3.80. We also posted the trade right here on the Navivest blog, for the benefit of our readers.

This morning at 10:53 AM, with Goldman Sachs down over $12, we sent out an exit alert, recommending subscribers put in a good til cancel order to sell the puts at $5.75. The order was filled soon thereafter, giving us profits of 51% in just three days.

The Options Capitalist is a twice a week service for option traders. More info on the service can be found here.

Tags: goldman sachs, Options, outs

Trade Of The Day – Buy Goldman Sachs Puts

Apr 27, 2010 Options, Trading Idea

The following trade is from the latest issue of The Options Capitalist, Navivest’s subscription-based trade recommendation service for option traders. More info on the service can be found here.

After dropping more than twenty points on April 16 from $183.62 to $160.70 on news that the SEC was suing the company for fraud, Goldman Sachs’ stock had held above $150 since then, after finding support. Yesterday however, the stock broke below $150, falling $5.37 to $152.03, violating that support area.

Furthermore, Goldman CEO Lloyd Blankfein and Fabrice Tourre, the employee at the center of the scandal, are testifying in front of the senate today. This may result in some more selling of the shares.

Buy the Goldman Sachs May 2010 145 puts. The closing price yesterday was $3.65 with a $3.70 ask.

Tags: goldman sachs, Options, puts, Trading Idea

37% 1 Day Gain In Freeport McMoRan

Mar 29, 2010 Options, Trading Idea

This morning, with the Dow Jones Industrials opening up about 40 points, which was even higher than pre-market indicators were suggesting, it looked like we would be getting yet another up day in stocks.

With the bullish signal, we sent out an alert at 9:49 AM to subscribers of our Options Capitalist service, with a recommendation to buy the Freeport McMoRan (FCX) Apil 80 calls. We got in at $2.90, when the stock was up $1.75 on the day. We just sent out an exit alert at 2:48 PM, after the calls hit $3.90.

The stock, which is now up $3.73 to $82.90 on the day, a further $0.30 gain from where we exited, is currently the second best performer among S&P 500 stocks, behind Intuitive Surgical (ISRG), which is gaining $5.65 to $347.65.

On a technical basis, we may see a bit more upside, but unless the broader stock market makes some big moves, or there is a huge gain in the dollar, we should see some resistance at $84. So depending on market fundamentals in the next couple days, we may actually try to make this a round trip and buy puts in Freeport McMoRan this week, in a bid to capture more profits on a downside move in the stock.

Tags: dow jones, FCX, freeport mcmoran, intuitive surgical, ISRG

Free Trade Recommendation – Sell ATI Calls

Mar 23, 2010 Options, Trading Idea

The following trade is from the latest issue (03/23/10) of Navivest Options Writer.

Navivest Options Writer

03/23/10

Allegheny Technologies (ATI) – $54.03

ATI shares have had a good run since the last week of February. The stock is now seriously overbought and we should see some correction or at the very least, some sideways trading.

Sell the Allegheny Technologies May 2010 60 calls. They are currently asking $1.60. Enter here between $1.50 and $1.70.

Navivest

for mor information on our subscription based services, visit the Navivest website at http://www.navivest.com.

Tags: allegheny technologies, call writer, option writer, sell options