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Archive for December, 2018

Kirkland Lake Gold (KL) Follows Gold Prices Higher

Sunday, December 30th, 2018

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

Kirkland Lake Gold (KL) Follows Gold Prices Higher

Kirkland Lake Gold has been an outperformer among the IBD Top 50 companies, gaining from strength in the price of Gold.  Take a look at this article which speculates a significant upside based on a technical outlook –  Kirkland Lake Gold Is Shining Bright on the Charts and this following article which discusses the performance of KL as well as other stocks and ETF’s within the same sector – Gold Mining Crushing the Market: Best ETFs & Stocks of Q4.

KL has made a clear break higher this month to trade at record highs.  The company stands out when compared to other IBD Top 50 stocks as it is the only one to make a decisive break higher.  The main appeal to KL is the recent acceleration in upside momentum which is evident on nearly every time frame.  Horizontal support is found near $23 as the level held the stock lower over the summer, however, considering the bullish momentum, investors may look to step in ahead of the level.

KL Chart December 2018

KL Chart December 2018

*source Tradingview.com

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

Buy To Open KL 15FEB19 22.5 Puts (KL190215P22.5)
Sell To Open KL 15FEB19 25 Puts (KL190215P25) for a credit of $.93 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when KL was trading near $25.  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 $90.50 and your broker would charge a $250 maintenance fee, making your investment $159.50 ($250 – $90.50).  If KL closes at any price above $25 on February 15, both options would expire worthless, and your return on the spread would be 57% (452% annualized).

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

IBD Underlying Updates December 27, 2018

IBD Underlying Updates December 27, 2018

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

Can Match Group (MTCH) Continue to Outperform?

Sunday, December 23rd, 2018

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 Match Group (MTCH) Continue to Outperform?

Analysts are keeping a close eye on MTCH, take a look at these two articles to see what they are saying about the stock – Worth taking a quick glance: Match Group, Inc. and Match Group Starting to Look Attractive.

The main technical appeal to MTCH is its outperformance relative to the overal markets.  Note the stock is about 16% higher to the low posted in late November while SPY dropped abruptly to fresh yearly lows in the past week.  As well, the stock boasts a 24% gain for the year, despite the decline from September highs.  Major support is found at $33.50 and this level held MTCH higher last month.  Support is also seen near $39, reflecting the high ahead of the earnings inspired gap up in August. From a technical standpoint, there is a large gap that should be covered by a $48 price at some point (as the earlier upside gap was eventually covered).

MTCH Chart December 2018

MTCH Chart December 2018

*source Tradingview.com

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

Buy To Open MTCH 18JAN19 36 Puts (MTCH190118P36)
Sell To Open MTCH 18JAN19 39 Puts (MTCH190118P39) for a credit of $1.10 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when MTCH was trading near $39.  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 $107.50 and your broker would charge a $300 maintenance fee, making your investment $192.50 ($300 – $107.50).  If MTCH closes at any price above $39 on January 18, both options would expire worthless, and your return on the spread would be 56% (818% annualized).

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

IBD Underlying Updates December 20, 2018

IBD Underlying Updates December 20, 2018

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 Growth Prospects Keep Mastercard (MA) Bid?

Monday, December 17th, 2018

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

Will Growth Prospects Keep Mastercard (MA) Bid?

Mastercard has had some positive news coverage as of late, take a look at these two articles – Visa & Mastercard: Strong Growth and Dividend Hike Opportunities? And IBD Stock Of The Day Master Shows Strength – And Gives This Market Warning.

As outlined by one of the above articles, MA is currently facing it’s 200-Day moving average.  Althought the article points out that the stock technically trades below it, there does not seem to be enough evidence of a clear break, or that bears have taken control.  The stock has held above a horizontal level found near $193 found close to the moving average that has acted as both support and resistance on several occasions since May.  Dips below this confluence area of support in the recent past have been short-lived, as seen on a monthly chart, where the stock has managed to hold above $197 on a monthly close basis.

MA Chart December 2018

MA Chart December 2018

*source Tradingview.com

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

Buy To Open MA 25JAN18 190 Puts (MA190125P190)
Sell To Open MA 25JAN18 192.5 Puts (MA190125P192.5) for a credit of $1.10 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when MA was trading near $195.  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 $107.50 and your broker would charge a $250 maintenance fee, making your investment $142.50 ($250 – $107.50).  If MA closes at any price above $192.5 on January 25, both options would expire worthless, and your return on the spread would be 75% (702% annualized).

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

IBD Underlying Updates December 13, 2018

IBD Underlying Updates December 13, 2018

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 Medpace Holdings (MEDP) Break to New All Time Highs?

Monday, December 10th, 2018

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

Will Medpace Holdings (MEDP) Break to New All Time Highs?

Medpace Holdings has been getting some media attention as of late, take a look at these two articles to see what analysts are saying about this stock – MEDP vs PRAH: Which Stock Should Value Investors Buy Now? and Bullish Trend Signal for Medpace Holdings.

The technical appeal in MEDP is it’s outperformance compared to the broader markets as well as some of the other stocks on the IBD Top 50 list.  MEDP has had a pickup in upside momentum since late October which seems to suggest it has resumed it’s uptrend following a correction.  In the past week, the stock saw some sellers near the $64 price point which resulted in a decline towards its 20-day moving average.  A break of $64 would have the stock trading at all time highs.  The stock appears to be well supported here with further support slightly below the 20-day moving average at $55 which was a level that held it higher after the gap up in late July.  As well, there is a rising trendline near the horizontal level that is drawn by connecting the October and November low

MEDP Chart December 2018

MEDP Chart December 2018

*source Tradingview.com

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

Buy To Open MEDP 18JAN19 50 Puts (MEDP190118P50)
Sell To Open MEDP 18JAN19 55 Puts (MEDP190118P55) for a credit of $1.33 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when MEDP was trading near $58.  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 $130.50 and your broker would charge a $500 maintenance fee, making your investment $369.50 ($500 – $130.50).  If MEDP closes at any price above $55 on January 18, both options would expire worthless, and your return on the spread would be 35% (312% annualized).

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

IBD Underlying Updates December 6, 2018

IBD Underlying Updates December 6, 2018

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

Can Intel Corp. (INTC) Overcome The $50 Psychological Barrier?

Sunday, December 2nd, 2018

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.

Last week, the market (SPY) enjoyed its best week in 7 years.  The 8 real-life option portfolios carried out by Terry’s Tips shared in the good news.  Our composite portfolio value gained 27% for the week, one of our best weeks ever.

Terry

Can Intel Corp. (INTC) Overcome The $50 Psychological Barrier?

Several analysts think Intel stock can move a lot higher, here are two of them – Why Intel ‘s Stock Is Poised To Surge and Bull of the Day: Intel (INTC).

From a technical perspective, INTC is facing a wall of resistance consisting of the psychological $50 barrier as well as the 200-day moving average.  However, the stock is seen consolidating below this resistance zone through out the month of November within a relatively small range which signals a lack of selling pressure.  This type of price action usually suggests that the bears are not in control and that the stock may well be on the verge of breaking higher.  As well, on a weekly chart, INTC posted a bullish engulfing candle as a result of price action in the past week which signals strength and favors a continuation higher.

INTC Chart November 2018

INTC Chart November 2018

*source Tradingview.com

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

Buy To Open INTC 11JAN18 47 Puts (INTC180111P47)
Sell To Open INTC 11JAN18 50 Puts (INTC180111P50) for a credit of $1.11 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when INTC was trading near $49.  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 $108.50 and your broker would charge a $300 maintenance fee, making your investment $191.50 ($300 – $108.50).  If INTC closes at any price above $50 on January 11, both options would expire worthless, and your return on the spread would be 57% (533% annualized).

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

IBD Underlying Updates November 29, 2018

IBD Underlying Updates November 29, 2018

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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Success Stories

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.

~ John Collins