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Chart of Day: Shutterfly (SFLY) Overbought…

Dec 01, 2015

Shares of Shutterfly have been on a respectable run on news that it delivered record Black Friday and Cyber Monday orders and revenue, but the stock may have gotten ahead of itself. It’s now a bit overbought using our momentum indicators.

Money Flow (MFI) has already reversed lower. And RSI and MACD are sitting in overbought territory, as the stock challenges previous failure points. As sales news dies out, SFLY could begin to reverse well off recent highs, as well.

Failure could send it back to the 50-day moving average around $41. To profit from that potential move, we can buy to open the SFLY January 2016 45 put up to $1.85.  


Chart of Day: Coke (KO) Downside

Dec 01, 2015

While analysts gush all over shares of Coke (KO) on the long side, consider this. The stock has become over-extended, challenging an area where the stock has now failed four times since September 2014. We don’t believe the stock is strong enough to break out here.

One of the best ways to profit from a very likely pullback in the name is by buying to open the Coke (KO) February 2015 43 put up to $1.45 and / or the KO February 42 put up to $1. Both should do very well with patience.


Chart of the Day: Disney Gives us 68% Gains in a Week

Nov 30, 2015

Well… that was easy.

On November 23, we recommended a buy on the DIS February 2016 115 put even with the Star Wars movie just weeks away.

We knew the stock was over-extended, challenging overhead double top resistance. We had to – at least – assume a healthy pullback was in store following that.

And that’s exactly what we got…

In the days that followed, DIS would pull back from the $119.42 high on November 23 to $113.91 today. That’s more than a $6 drop… And all we had to do was pay attention to our technical reads on momentum.

The February 2016 115 put [bought at $3.85] now trades at $6.45.

That’s a gain of 68% in days… Sell to close half. Hold the second half. We believe DIS could challenge its 50-day.


Chart of the Day: ACADIA Ready to Break Out...

Nov 25, 2015

It’s been one of the hottest biotech stocks of the last three years…

Since 2012, shares of ACADIA Pharmaceuticals (ACAD) have risen more than 4,000%...

No wonder the press believes biotech stocks are in a bubble.  But as much as the press wants investors to believe the biotech boom in such stocks has peaked, it’s just not true.

In fact, with the recent news out of the ACADIA camp, the boom has only just begun.

By May 1, 2016, the FDA will make its final decision on approving ACAD’s drug for the treatment of Parkinson’s disease Psychosis…

That’s exciting news...

An estimated 40% of patients with Parkinson’s disease develop PDP, often characterized by frightening hallucinations and delusions.  There are as many as a million people in the U.S. that suffer from Parkinson’s.    

Another four to six million worldwide suffer as well.

At the moment, the only drugs used to treat PDP come with side effects, such as worsening motor skills, further mental issues, and potential weight gains. None of them have ever been approved to address PDP, though.

But in Phase III trials, Nuplazid was found to produce significant anti-psychotic efficacy in primary goals. It also reached its secondary goals, as well, with good success in motoric tolerability.  The only side effects noted in the Phase III Nuplazid study were urinary tract infections, and falls.  

Buy shares of ACAD up to $40… and be patient.  As excitement heats up going into May, the sky's the limit.


Chart of the Day: Disney Challenging Highs…

Nov 23, 2015

In August 2015, we recommended a buy on Disney (DIS) and the DIS January 2016 115 calls, as they traded at $109.50 and $3.60, respectively. Today, as the stock over-extends, challenging the prior high of $122.08, it’s time to jump out of our initial trade recommendation.

The DIS stock last traded at $119.42 – a 9% gain. Take it.

The DIS January 2016 115 calls last traded at $6.55 for a gain of 82%. Take it.

As the stock begins to over-extend, we believe near-term upside is limited, even with the Star Wars movie coming out. We’re seeing overbought reads on most technical patterns, as well, leading us to believe we’ll see a quick sell-off shortly.

The best way to trade that potential move is by buying to open the DIS February 2016 115 put up to $4.40.


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