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Netflix (NFLX): Here We Go Again!

In October, NFLX took a huge drop after its earnings!  I wrote an article to show the big trading range that NFLX traded in and where it might be heading (Click here to see the article).

Today, after the market, NFLX jumped +16% on the report that the company added 4.3 million subscribers!  Let’s visit the chart again:

NFLX

We can see in this chart that the low end of the trading range is about $320; and, the high end is about $460.  There’s a more detailed description in my post from October 2014

Let’s revisit what happened after Netflix’s earnings in October.  NFLX shares opened the day after earnings at around $330 and started to climb.  But, soon it met that resistance at $380 (mentioned in October’s post) and stalled.  Eventually, it came back down to test the low end of the trading range at $320.

This evening, NFLX zoomed higher to about $405, already above that $380 mark.  The next resistance is at about $420.  But, in the next few months, NFLX should come back up to test $450-$460, provided that the broader market stays healthy.

Good night and HappyTrading! ™

Weekly Wrap-Up: VXX, Z, VLO, CLVS

We mainly traded on the downside in the ”
Happy Trades” portfolio, besides our CLVS calls.  All of the closed trades were profittable:

VXX Feb 20 2015 Call 34.0 $4.775 $525.00 12.35% 01/16/2015
Z Feb 20 2015 Put 100.0 $8.25 $700.00 20.44% 01/15/2015
VLO Feb 20 2015 Put 47.5 $4.00 $550.00 15.94% 01/14/2015
CLVS Feb 20 2015 Call 60.0 $4.90 $650.00 15.29% 01/13/2015

Please
click here to see the Weekly Wrap-Up for “Ecstatic Plays” and Market Forecast.

Good night and HappyTrading! ™

Weekly Wrap-Up + Market Forecast + Sector Watch: SPX, Nasdaq, GLD, XLE, FAS, FDN, GS, VLO, GLD, MS, AXP, HAL, IBM, NFLX, FFIV, EBAY

Stocks recorded another losing week last week. In my Market Forecast, I wrote:

We will definitely get a feel from the financials, which could drive the broader market one way or the other. We have support at SPX 2000 and resistance at 2080.”

Indeed, financials were very weak and dragged down the broader market. Things fell on Monday. Tuesday was a volatile day with a “head-fake” pop in the morning, only to close lower. Wednesday and Thursday were a struggle to hold below SPX 2000. Finally, on Friday, some buyers trickled in and the market saw a little bounce.

We had a busy week. Gold calls and energy puts gave us some nice profits. Here are the closed trades:

GLD Feb 20 2015 Call 120.0 $4.775 $1,300.00 37.41% 01/16/2015
EOG Feb 20 2015 Call 87.5 $6.175 $1,050.00 20.49% 01/16/2015
VXX Jan 23 2015 Call 35.0 $2.625 $275.00 11.70% 01/16/2015
GILD Feb 20 2015 Put 100.0 $5.225 $-450.00 -7.93% 01/16/2015
AMZN Jan 23 2015 Put 292.5 $7.675 $325.00 9.25% 01/15/2015
AMZN Jan 23 2015 Put 292.5 $7.35 $162.50 4.63% 01/15/2015
Z Feb 20 2015 Put 100.0 $7.85 $525.00 15.44% 01/15/2015
HLF Jan 17 2015 Put 32.5 $2.065 $-185.00 -8.22% 01/14/2015
AMZN Jan 17 2015 Put 292.5 $4.875 $287.50 13.37% 01/14/2015
GS Jan 17 2015 Put 185.0 $4.75 $927.50 64.08% 01/14/2015
VLO Feb 20 2015 Put 47.5 $3.975 $705.00 21.56% 01/14/2015
VLO Feb 20 2015 Put 47.5 $3.75 $480.00 14.68% 01/14/2015
SCTY Feb 20 2015 Call 50.0 $3.65 $-75.00 -2.01% 01/13/2015
BA Feb 20 2015 Call 130.0 $3.825 $-2,587.50 -31.08% 01/13/2015
AAPL Feb 20 2015 Call 110.0 $4.875 $-1,425.00 -22.62% 01/13/2015
V Jan 17 2015 Put 260.0 $0.85 $-3,700.00 -81.32% 01/13/2015
GLD Jan 17 2015 Call 117.0 $2.02 $70.00 3.59% 01/13/2015
OXY Jan 17 2015 Put 75.0 $1.03 $-5.00 -0.48% 01/13/2015
OXY Jan 17 2015 Put 75.0 $1.355 $320.00 30.92% 01/12/2015
GLD Jan 17 2015 Call 116.0 $2.77 $955.00 52.62% 01/12/2015
TSLA Jan 17 2015 Put 205.0 $7.525 $1,150.00 44.02% 01/12/2015

For the week, the Dow was down 225.8 points; SPX fell 25.39 points; Nasdaq lost 69.69 points. Gold, once again a “safe haven”, got a nice pop, closing at around $1277/ounce. Oil traded down to below $45/barrel, but, clawed its way back to close just below $50/barrel. At the time of this writing, Asian markets were mostly higher, although on Monday, China was down nearly 7% on new margin regulation for stock brokerage accounts. Here’s where the US markets stood after Friday’s close:

SPX

On Friday, SPX added +26.75 points to close at 2019.42. It closed below its daily MAs. The MACD was flat.

Nasdaq

Nasdaq bounced +63.56 points to close at 4634.38. It also closed below its daily MAs and the MACD slid.

Both SPX and Nasdaq closed below their respective daily MAs. For the new week…

If you’d like to read the rest of the articles, please subscribe to my Ecstatic Plays product (Click Here).

Watching Biotechs

Biotech stocks have thus far held up pretty well, while the market goes through tremendous volatility, sliding lower.  Most sectors now are looking bearish.  Financials fell off the cliff yesterday.  Semiconductors are getting weaker (INTC reports after market today).

Let’s take a look at the biotech index, BTK:

It is still holding a bullish chart.  But, I’m watching leaders such as BIIB, CELG (still very strong), and GILD.  If these start to turn lower, I think we will see selling on the overall market pick up speed and volume.

See my article on 1/7/2015, “Is The Selling Done?”

Good night and HappyTrading! ™

Is The Selling Done?

After five days of selling, markets managed to bounce a bit today.  Yesterday, stocks plunged mid-morning, sending SPX down to test 2000.  Soon after, buyers started to trickle in.

Taking a look at the indices and the sector ETFs, we see that financials and biotechs led the market bounce:


XLF (financial) was up +1.05%, while BTK (biotech) was up +3.01%.  PBJ (food & beverages) jumped +2.14%.

Restaurant stocks were really strong today.  LOCO was on its 3rd-day of rising, adding another +5.86% today.  CMG vaulted $30 in one day!  CAKE also broke higher with a +3.77% rise.  Among beverages, MNST stood out, soaring another +3.28%.  GMCR popped +4.58% on a deal with Dr. Pepper Snapple.  Our exit on GMCR puts was timely:

GMCR Jan 17 2015 Put 130.0 10.0 $4.60 $1,425.00 44.88% 01/06/2015

The Dow was up +212.88 points; SPX added +23.29 points; Nasdaq gained +57.73 points:

SPX

SPX added +23.29 points to close at 2025.9.  Its daily MAs and MACD were lower.

Nasdaq

Nasdaq gained +57.73 points to close at 4650.47.  Its daily MAs and MACD also slid.

The selling in the past five days have been so strong, even though the market indices were up more than 1% today, their respective daily MAs and MACD were still sliding lower.

If this market is going to turn up from here, I think it will take a few more days.  The daily MAs are still pointing down.  The momentum from the 5-day selling is too strong to overcome by just one “up” day.  SPX has resistance now at around 2040-2050.  

We have jobs data coming out tomorrow and Friday.  But, I don’t know if the numbers are going to affect the markets much either way.  If the numbers are lower-than-expected, it could mean that the Fed could hold off raising interest rates a little longer.  But, does it mean that the economy is not as strong?  On the other hand, if the numbers are stronger-than-expected, it could mean that the Fed could raising rates sooner.

So, the charts are already telling us what people are thinking.  The opinions are mixed, and the market will likely be, at best, range-bound. Let’s not chase this bounce and have some downside protection.

Good night and HappyTrading! ™

Biotechs Rally!

Biotech stocks were really strong today.  BIIB led the group with a $18.59 pop!  ALXN added nearly $10.  AMGN gained $5.34, erasing yesterday’s loss.  JAZZ climed +3%.  ILM popped $6.61.

At first glance, BTK looks to be healthy

BTK has been consolidating for more than a month.  Its daily MAs have bunched together.  Just yesterday, BTK was look bearish when it sank below its daily MAs.

This is what happens when something is consolidating.  BTK may close above or below its bunched-up daily MAs many times before the final direction is decided.  Take a look at what happened in Sept-Oct.  Another thing to note is that the MACD is still bearish, although it is somewhat flattening.

Do I sound bearish?  I hope not.  I am neutral at this point.  I think people are starting make their positions ahead of the J.P. Morgan Healthcare Conference on Monday, January 12.  So, let’s be patient and see how things trade in the next couple of days.

Good night and HappyTrading! ™

A Couple of Mid-To-Long Term Buys: GRPN, AKAM

Looking through some of the gainers from last week, two stocks caught my attention.  These two stocks have not performed well in the recent months.

GRPN

GRPN  has not performed well at all this year.  But, the stock popped after earnings in October.  It took time to consolidate and now it looks like a breakout!  There’s a gap to fill at $10.  March $8 calls are at about $1.  If it gets to $10 by March 20th, this play would be a nice double.

Personally, I actually use Groupon and did some online Christmas shopping from the company this year as well.  Their return policy is pretty good, and printing return label is very easy.  I think this troubled company may be sticking around.

AKAM

Cloud services are becoming more and more prevalent. It is the future.  AKAM popped early in the year and really has not gone anywhere since.  However, I think this breakout could be for really, provided that the overall market condition stays bullish.  AKAM has gone quite far in the past couple of weeks.  I don’t think there’s any hurry to jump in right now.  But, I will keep this on my radar.  I think if it gets down to below $63, I will look to buy Feb $62.5 calls.

Good night and HappyTrading! ™

Weekly Wrap-Up: BA, HES, GILD, PCLN, AMZN, GPRO, PCLN, CMG, RL

Happy Holidays! I hope everyone enjoyed a nice Christmas!

For those of you who were trading (I was :D ), although trading was light markets rallied higher again last week, sending the Dow and SPX up to new heights.  Nasdaq closed above 4,800, marching closer to the 5,000 mark.  

We had a nice leisurely week, with all but (1) trade in the
gr$$N!  We cashed out the our HES calls and jumped on GILD puts for a nice +69% profit.  We made a solid play on BA and garner some nice profits.  Here are the closed trades for the week:

Symbology Exit P/L ($) P/L (%) Exit Date
BA Jan 17 2015 Call 130.0 $3.15 $1,986.00 26.61% 12/26/2014
BA Jan 17 2015 Call 130.0 $3.15 $662.00 26.61% 12/24/2014
BA Jan 17 2015 Call 130.0 $2.90 $412.00 16.56% 12/24/2014
AMGN Jan 17 2015 Put 160.0 $3.95 $-3,650.00 -48.03% 12/24/2014
HES Jan 17 2015 Call 72.5 $3.70 $385.00 26.28% 12/23/2014
WYNN Jan 17 2015 Call 150.0 $6.15 $350.00 6.03% 12/23/2014
GILD Jan 17 2015 Put 95.0 $7.85 $3,200.00 68.82% 12/23/2014
HES Jan 17 2015 Call 72.5 $3.25 $320.00 10.92% 12/22/2014
HES Jan 17 2015 Call 72.5 $3.15 $330.00 7.51% 12/22/2014

Retail stocks performed well.  AMZN went up $6 on Friday,
citing 10 million new prime members added!  GPRO gained almost $10 for the week.  RL popped to a new all-time high.  High-flyers such as PCLN and CMG also had a big week.  Biotechs were volatile.  As mentioned above GILD puts gave us a nice gain, but, we got our hands caught in the cookie jar on AMGN puts.  We will definitely look at these more closed tomorrow in my weekly Market Forecast and Sector Watch.

Hope you are enjoying some nice family time!

Good night and HappyTrading! ™

Weekly Wrap-Up: CMI, CF, UNP, NFLX, LULU

Wow, what a week it was!  Both the Dow and SPX took a nosedive!  Oil kept on falling and pulled the energy stocks lower and lower.  To a big extent, that soured the mood for the broader market.  Once the momentum took over, it was feeding frenzy for the bears!

We had a nice week, finding profitable trades on both sides.  Our closed trades were mostly positive.  CMI, CF, UNP, and NFLX puts worked well.  Here are the closed trades for the week:

CMI Dec 20 2014 Put 143.0 $2.15 4.88% 12/12/2014
FAS Jan 17 2015 Call 130.0 $4.75 -4.04% 12/11/2014
BIDU Dec 20 2014 Call 230.0 $5.40 35.00% 12/11/2014
LULU Jan 17 2015 Call 47.5 $4.30 22.86% 12/11/2014
CMI Dec 20 2014 Put 147.0 $4.10 51.85% 12/10/2014
CF Dec 20 2014 Put 260.0 $9.30 45.31% 12/10/2014
SCTY Dec 20 2014 Call 52.5 $1.11 -58.27% 12/10/2014
BIDU Dec 20 2014 Call 230.0 $4.15 -17.00% 12/10/2014
BIDU Dec 20 2014 Call 230.0 $5.00 6.38% 12/09/2014
BIDU Dec 20 2014 Call 330.0 $4.70 38.24% 12/09/2014
UPS Dec 20 2014 Call 110.0 $0.85 -61.54% 12/09/2014
AMZN Dec 20 2014 Put 307.5 $8.20 7.89% 12/09/2014
UNP Dec 20 2014 Put 115.0 $3.20 66.67% 12/09/2014
SNDK Dec 20 2014 Call 104.0 $3.70 15.62% 12/08/2014
NFLX Dec 12 2014 Put 345.0 $7.00 12.90% 12/08/2014
NFLX Dec 12 2014 Put 345.0 $7.50 20.97% 12/08/2014
SNDK Dec 20 2014 Call 104.0 $3.30 3.12% 12/08/2014
NFLX Dec 12 2014 Put 347.5 $7.40 17.46% 12/08/2014
NFLX Dec 12 2014 Put 347.5 $6.60 4.76% 12/08/2014

USO, the US ETF for oil, closed at a new all-time low of $21.93 this week!  Previous low was $22.74, set at the market lows in 2009.  Energy stocks have been leading the market decline.  People who jumped in and bought energy stocks last week were cut by falling knives!  We will definitely have a more detailed discussion on the energy sector tomorrow in my weekly Market Forecast.

We will also look at financials and biotechs, which are both still relatively healthy.

Happy weekend and HappyTrading! ™

Taking Profits on Puts AMZN, UNP; Two Long-Side Trade Ideas: FB, MBLY

Markets gapped down today, with the Dow down almost 200 points and SPX losing about 25 points.  But, within the first hour of trading, buyers quickly came in.  By the end of the day, the Dow closed down only 51 points and SPX almost turned green!  

We took profits on our UNP and AMZN puts:

UNP puts gave us an overnight +67% profit.  We didn’t get the high on the AMZN puts, but, we did get out with a small profit.  AMZN ended up almost $6 by the end of the day!

Since buyers are buying the dips, let’s take a look at a couple of interesting trade ideas:

FB

FB’s chart is shaping up nicely.  It went down at open with the broader market today, but, came back up and closed in the green.  There is a gap to fill from last month’s earnings drop.  I can see this rallying back to test $80.

MBLY

MBLY has been trading lower.  But, last week’s pop from the bottom is quite interesting.  This chart is not very strong, but, its MACD has turned bullish.  I think this can get a quick pop to test $48.

Good night and HappyTrading! ™