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Chart of Day: Buy the Most Hated Stock on the Market

Nov 13, 2017

AT&T (T) has been beaten silly. However, most of the pain may have been priced into the stock already, handing us an opportunity to "buy the blood in the streets," as Baron Rothschild would say. It also gives us an opportunity to "buy when others are fearful," as Warren Buffett says. Interesting to note, an executive at Berskshire Hathaway just bought a million shares of AT&T for $33.75 each. Plus, we have to consider that the stock still pays out a respectable dividend, which seems safe given that the company is still generating a good amount of free cash flow.

Technically, the stock looks like a disaster at first glance. However, it appears to have found support at current prices  with incredibly oversold conditions on RSI, MACD and Williams’ %R. We believe that with a good amount of patience, we could see a test of $38.  Buy to open the T February 2018 34 calls at market prices.

Chart of Day: AMD Target $14

Nov 07, 2017

Over the last few weeks, shares of AMD took an incredible hit, falling from a high of $14.25 to $11.03.  However, we are just now seeing signs that a bottom could be in place.  Not only are traders flocking to call options these days, but the stock appears to have caught and held support dating back to earlier this year.  As long as this holds with oversold reads on RSI, MACD and Williams’ %R, we’d like to see a potential bearish gap refill at $14 a share.  

Buy the stock, and, or the AMD January 19, 2018 12 calls.



Chart of Day: Expedia (EXPE) Insanely Oversold

Nov 06, 2017

Shares of Expedia (EXPE) have become excessively oversold after missing earnings estimates.  But with a good deal of negativity now priced into the stock, we’d like to see a bearish gap refill around $147.50 at some point.  

Even RSI, MACD and Williams’ %R are deep in oversold territory at the moment.  

The last time Williams’ %R was this low, the stock exploded from a lof of $125 to $160.  

Personally, I think this is a solid opportunity.  It’s far too oversold. Buy to open EXPE December 15, 2017 125 calls.

Chart of Day: Shopify Explodes… Take your Gains.

Oct 31, 2017

On October 5, 2017, we noted:

After a big move from lows of $19.84 to $120 a share in less than two years, Shopify (SHOP) fell victim to a short-selling article from Citron Research, which claims SHOP is a “get rich quick scheme.”  Interesting to note, Citron took a short position in the stock, perhaps prior to this article going to print.  That says a lot. And while we’re likely to see further pullback in the stock today, as fear runs amok, we still see opportunity to buy now, as it catches potential support at its 50-day moving average.  It also doesn’t hurt that the company is now fighting back against this short sellers’ claims.  Buy to open SHOP November 17, 2017 105 calls.  What we’d like to see here is a near-term recovery to $106.  

At the time, the SHOP November 17m 2017 105 calls traded at just $4.50. Today, they’re up to $9.10, as the underlying stock just begins to recover.

If you bought in, consider selling to close half now.

Chart of Day: Celgene (CELG) Goes on Sale

Oct 30, 2017

Shares of Celgene (CELG) have become so severely beaten down, it’s a screaming buy opportunity.

For it to have fallen from $140 to $98 in just days is a severe overreaction.  It’s simply down on a rough patch and is very likely -- in our opinion -- to bounce back in a big way.  Plus, the stock is now trading at multi-year support levels dating back to 2014.  As long as it holds, we could see a respectable bounce back in the stock.   

One way to consider trading it is by buying to open the CELG December 15, 2017 105 calls.

We'd like to see a potential bearish gap around $120 at some point, near-term.


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