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InterOil: The Easiest Money Ever Made

Oct 09, 2015

On September 15, I noted:

It's time to buy IOC again, as our technical pivot points become over-extended. Plus, Goldman Sachs just added the stock to its Conviction Buy list with a PT of $45 a share.  Consider buying the underlying stock up to $38 and / or the IOC December 2015 35 calls at market.

As of today, IOC trades just under $39. The calls last traded around $5.50.  Take the gains.

It shouldn’t be this easy to make money.

 

 

 

Zumiez (ZUMZ): 264% and 29% in Less than a Month…

Oct 08, 2015

Well… that was easy.

Just weeks after recommending a buy on the ZUMZ underlying stock and the November 15 calls, the stock exploded as expected.

ZUMZ just ran to $18.55 on the day giving us a 29% gain on the stock. The move also sent the November 15 call to a bid ask of $3.60 x $4.50. Using a median price of $4, that gives us a 264% gain from a $1.10 entry price.

All we had to do was stick to our system. RSI, MACD and MFI were all incredibly oversold. We bought. We made money. And now we’re walking away.

Not too shabby at all…

If you bought in, close both positions today.

At the moment, I’m a bit concerned the stock has run up too far too fast in recent weeks. We could see a near-term pullback in the name before another attempt to refill the $22.50 gap. Consider buying to open a small position in the ZUMZ November 2015 17.50 put up to $1.20.

 

Chinese Stocks: Wall Street Finally Wakes Up…

Oct 07, 2015

Since June, the Chinese market she more than 40% of its value as investors fled. In recent weeks, though, some of the biggest firms, including London-based Algebris believes now is the time to buy…

“We are long Chinese equities for the first time in our history,” they noted, as quoted by The Wall Street Journal.

I find this a bit funny, though… even late.

We’ve been recommending a buy on China since late August near the bottom.

At the time, I was mocked.

It happens, though. Not big deal. I noted that a great way to trade China here is by buying the Direxion Daily China Bull 3x Shares (YINN), the iShares MSCI China Index Fund (MCHI) and the iShares FTSE China 25 Index Fund (FXI).

We were able to buy the YINN at $18.50. It now trades at $22.13.

We were able to buy the MCHI at $44. It now trades at $47.25.

We were able to buy FXI at $35.70. It now trades at $38.40.

While we booked gains on each of these weeks ago, we’re still holding the second halves of each… We believe the rebound has only just begun.

 

Zumiez (ZUMZ) Returns 77% in less than a month

Oct 06, 2015

It shouldn’t be this easy to make money.

Back on September 15, shares of ZUMZ had just gapped down from $22.50 to less than $14.50 a share. But only foolish investors skipped the opportunity presented by oversold reads on MACD, MFI and RSI.

Shortly after, we recommended a buy on the underlying stock up to $15 as well as the November 15 calls up to $1.35 [entry price of $1.10]. Today, as the stock begins to rebound from excessively oversold conditions, the stock hit an intra-day high of $16.60.

Those calls options hit a high of $1.95 on the day.

If you bought in, consider closing half of each to secure gains. I believe there’s much further upside remaining here.

What’s nice about this stock is that it has a history of bouncing beautifully from past similar oversold reads, too.

 

 

 

 

 

Biotech Stocks: Sell Off was a Gift

Oct 05, 2015

The other day, I noted the sell off in the biotech sector was greatly overdone…

Fears of a bursting bubble were overplayed. Hillary Clinton’s 91-character tweet had been priced in. And the underlying fundamentals that birthed the boom in biotech are still there.

As more than 10,000 baby boomers continue to retire by the day, coupled with new healthcare coverage and treatments, biotech could move aggressively higher. Better yet, more than $2.3 billion of venture capital has flowed into the sector during the second quarter of 2015 – a 32% jump quarter over quarter.

We noted that AMGN was oversold. Since that mention, the stock has moved from $137 to more than $143.80 where it stands today.

We also noted that ACAD – which meets an unmet medical need with PDP – was a buy up to $34. Since then the stock has moved from $31.50 to $35.25.

That sell off in biotech was – and is – a gift.

As for new trade ideas, consider buying Pro Shares Ultra NASDAQ Biotechnology (BIB) up to $66. We strongly believe the biotech rebound has only just begun.   After a massive drop, trades – such as BIB – are rebounding from oversold conditions.

 

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