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Archive for March, 2019

Can Five Below (FIVE) Maintain The Earnings Inspired Momentum?

Sunday, March 31st, 2019

Dear {firstname) –

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

Terry

Can Five Below (FIVE) Maintain The Earnings Inspired Momentum?

Several analysts are expecting further upside for FIVE, here are two of them – Five Below (FIVE) PT Raised to $145 and Five Below (FIVE) PT Raised to $135 at Buckingham Research.

FIVE broke higher following their earnings report in the past week, scaling above the 50-day moving average.  The indicator is now seen as support and carries some confluence as a horizontal level at $121 as well as a rising trendline originating from December lows are within close proximity.

If you agree there’s further upside ahead for FIVE, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open FIVE 3MAY19 121 Puts (FIVE19053P121)
Sell To Open FIVE 3MAY19 124 Puts (FIVE19053P124) for a credit of $1.15 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when FIVE was trading near $124.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers).  Each contract would then yield $112.50 and your broker would charge a $300 maintenance fee, making your investment $187.50 ($300 – $112.50).  If FIVE closes at any price above $124 on May 3, both options would expire worthless, and your return on the spread would be 60% (684% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates March 28, 2019

IBD Underlying Updates March 28, 2019

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

Consider Amazon.com (AMZN) Following the Technical Breakout

Sunday, March 24th, 2019

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

Terry

Consider Amazon.com (AMZN) Following the Technical Breakout

AMZN recently made a significant technical break that stands to have bullish repercussions, take a look at what these two analysts have to say about it – Amazon’s Breakout May Fuel A Return To Its All-Time Highs and Amazon Stock Is Finally Breaking Out.

There are several ways to view the AMZN breakout, the above two articles include several of the variations.  The one technical break that most are probably watching is the push above the stocks 200 daily moving average.  The below chart shows that price stalled out near it three times this year prior to the technical break last week.  A declining trendline originating from a high posted in October is also in play.  In the current pullback, strong support is seen at the moving average followed by the previously broken descending trendline which is found slightly below the indicator.

AMZN Chart March 2019

AMZN Chart March 2019

If you agree there’s further upside ahead for AMZN, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open AMZN 26APR19 1760 Puts (AMZN190426P1760)
Sell To Open AMZN 26APR19 1762.5 Puts (AMZN190426P1762.5) for a credit of $0.98 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when AMZN was trading near $1765.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers).  Each contract would then yield $95.50 and your broker would charge a $250 maintenance fee, making your investment $154.50 ($250 – $95.50).  If AMZN closes at any price above $1762.5 on April 26, both options would expire worthless, and your return on the spread would be 62% (707% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates March 21, 2019

IBD Underlying Updates March 21, 2019

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

Will MasTec’s (MTZ) Growth Prospects Keep the Stock Bid?

Sunday, March 17th, 2019

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.  The Terry’s Tips actual portfolio that trades these ideas has gained 164% so far in 2019.  As always, future results can’t be assured to be as good, but we are pleased with the results so far.

Terry

Will MasTec’s (MTZ) Growth Prospects Keep the Stock Bid?

MasTec’s recent earnings report exceeded expectations and several analysts believe growth trends will continue, here are two of them – MasTec’s 2018 Results: A Lot to Like Here and Will MasTec Earnings Grow Over The Next Year?

Although a daily chart is displayed below, the strongest technical indicator for MTZ is seen on a weekly chart where the stock regained it’s 100 moving average on a sustained basis.  The daily chart confirms the uptrend as the stock is held within a rising trend channel.  The stock has held above a horizontal level at $47.30 in recent sessions, this is a level that was well respected resistance for most of 2018 on several attempts.  Further support in the event of a dip lower is seen near $45.55 where a horizontal level is found as well as the 20-day moving average.

MZT Chart March 2019

MZT Chart March 2019

*source Tradingview.com

If you agree there’s further upside ahead for MZT, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open MZT 18APR19 44 Puts (MZT190418P44)
Sell To Open MZT 18APR19 47 Puts (MZT190418P47) for a credit of $0.85 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when MZT was trading near $48.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers).  Each contract would then yield $82.50 and your broker would charge a $300 maintenance fee, making your investment $217.50 ($300 – $82.50).  If MZT closes at any price above $47 on April 18, both options would expire worthless, and your return on the spread would be 38% (433% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates March 14, 2019

IBD Underlying Updates March 14, 2019

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

MGM Growth Properties (MGP) Dips Lower, Is It A Buy?

Sunday, March 10th, 2019

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

Terry

MGM Growth Properties (MGP) Dips Lower, Is It A Buy?

Several analysts think MGM Growth Properties has a lot more upside, here are two of them – A Careful Analysis of MGM Growth Properties and MGM Growth Properties On The Radar of Prospective Investors.

MGP is seen pulling back after testing resistance from a trendline drawn by connecting a high from late 2017 with the high from last year.  Momentum indicators show no reason to believe a triple top is playing out and candlestick patterns on the higher time frames point to strength in recent upward momentum.  The stock is currently testing its 200-day moving average which could be a spot where bulls might look to reenter.

MGP Chart March 2019

MGP Chart March 2019

*source Tradingview.com

If you agree there’s further upside ahead for MGP, consider this trade which is a bet that the stock will continue to advance over the next six weeks, at least a little.

Buy To Open MGP 18APR19 25 Puts (MGP190418P25)
Sell To Open MGP 18APR19 30 Puts (MGP190418P30) for a credit of $1.18 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when MGP was trading near $30.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers).  Each contract would then yield $115.50 and your broker would charge a $500 maintenance fee, making your investment $384.50 ($500 – $115.50).  If MGP closes at any price above $30 on April 18, both options would expire worthless, and your return on the spread would be 30% (281% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates March 7, 2019

IBD Underlying Updates March 7, 2019

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

American Tower Corp (AMT) Rallies to Record Highs, What’s Next?

Sunday, March 3rd, 2019

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum. The actual Terry’s Tips portfolio which trades these weekly trade ideas has gained 157% so far in 2019, by far surpassing our other portfolios which have enjoyed average gains of 19% for the first two months of the year.  Of course, past results can’t always be replicated in the future, but we are pleased with the results so far this year.

Terry

American Tower Corp (AMT) Rallies to Record Highs, What’s Next?

Several analysts remain bullish AMT following their earnings report in the past week, here are two of them – American Tower Delivers High-Speed Growth in Q4 and Gearing for a bull run? American Tower Corp Moves 7.42% For The Quarter.

AMT has been rising within an ascending trend channel that dates back to a low printed in late December.  The price action surrounding the earnings report suggests that bulls remain in control.  The stock was volatile on the earnings date, rising about 2% initially but then reversing sharply to end lower on the day.  However, a rally the following day after testing the lower bound of the trend channel saw the price break to a record high, fully erasing the earnings-inspired drop.  The technical outlook points to the potential of a rally towards the top of the rising trend channel.

*source Tradingview.com

If you agree there’s further upside ahead for AMT, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open AMT 05APR19 175 Puts (AMT190405P175)
Sell To Open AMT 05APR19 177.5 Puts (AMT190405P177.5) for a credit of $0.85 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when AMT was trading near $178.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers).  Each contract would then yield $82.50 and your broker would charge a $250 maintenance fee, making your investment $167.50 ($250 – $82.50).  If AMT closes at any price above $177.5 on April 05, both options would expire worthless, and your return on the spread would be 49% (559% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates February 28, 2019

IBD Underlying Updates February 28, 2019

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

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I have been trading the equity markets with many different strategies for over 40 years. Terry Allen's strategies have been the most consistent money makers for me. I used them during the 2008 melt-down, to earn over 50% annualized return, while all my neighbors were crying about their losses.

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