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Option Trade of the Week – It’s Intuitive

January 31, 2024

Dear [[firstname]],

Here’s your Option Trade of the Week as included in this past weekend’s Saturday Report for our Terry’s Tips Premium Members.The credit from last week’s trade ran away from us pretty quickly, so I opted to pass on sending it out knowing that you wouldn’t get the minimum credit. This week’s trade – which gets us back on a bullish track – has a better chance for entry. So, I’m hoping that you can make it work.

Before that, though, I have to tell you that our Microsoft (MSFT) portfolio – we call it Wiley Wolfis on fire. With January in the books, we are already up more than 22% while the stock itself is up less than 6%. In fact, we booked more than half that huge gain just today after MSFT’s earnings!

How did we do it? The same way we bagged 70% and 92% profits using MSFT and QQQ last year – Dr. Terry Allen’s 10K Strategy. This market-beating strategy has proven itself over the past two decades … and this year looks to be no exception.

You can’t afford to miss out on these profits. Resolve to make 2024 your best trading year ever – and learn about Terry’s unique strategy – by becoming a Premium Member of Terry’s Tips.

For our loyal newsletter subscribers (that’s you), I’m of course keeping the sale going that saves you more than 50% on a monthly subscription to Terry’s Tips. Plus, I’m adding a promise that this rate will never increase. I won’t make this promise forever, though, so now is the time to get in on the action … and profits.

As a Premium Member to Terry’s Tips, you’ll get …

  • A month of all trade alerts in our four portfolios, giving detailed instructions for entering and exiting positions. Trade one portfolio (I recommend Wiley Wolf) or all four. It’s up to you.
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And, for a limited time, I am including a Special Bonus. Terry Allen has condensed his 30 years of options trading experience into an eBook – Making 36% – A Duffer’s Guide to Breaking Par in the Market Every Year, in Good Years and Bad. Learn a different way to trade using Terry’s unique and decades-tested 10K Strategy. This book is normally $9.98 on our website (and $19.95 on Amazon), but I will personally send you the digital version for free with a paid subscription.

To become a Terry’s Tips Premium Member, just Click Here, select Sign Up Now and use Coupon Code D21M to start a monthly subscription to Terry’s Tips for half off. You can cancel after a month but, of course, keep all the valuable reports and the book.

I look forward to having you join in the fun and profits! Now on to the trade …

It’s Intuitive

Lots to chew on this week with earnings season in full swing, so let’s dive right in with a bullish trade on Intuitive Surgical (ISRG). The company makes surgical instruments, notably the da Vinci robot, that emphasize minimal invasiveness. ISRG reported Tuesday after the bell, easily beating on the top (profit) and bottom (revenue) lines. Earnings per share increased 30% from a year earlier, while revenues improved more than 16%. Much of this growth came from a 21% increase in da Vinci procedures.

Analysts were quick to raise their target prices, with at least a half dozen trying to beat each other to the punch. These were not minor increases, either. One firm raised its target by 35%, while several others were around 15%. That equates to increases of $30 to more than $100 … not bad for a $375 stock. Oddly, there were no rating increases, keeping ISRG at a solid buy rating. However, there are few holds on the stock, leaving some room for upgrades.

Also odd is the fact that the stock fell as much as 3.4% on Wednesday, though it closed just 0.4% lower. That’s the smallest move after earnings in more than 11 years. There wasn’t much action after that, as ISRG gained about a percent on Thursday and Friday. The stock reaction might give one pause given the strong earnings results. However, the muted move makes more sense since the company already released bullish guidance numbers a couple of weeks ago. That caused the shares to pop more than 10%, making this week’s news less impactful.

The guidance surge pulled the stock away from its 20-day moving average, a trendline that has guided a 47% rally over the past three months. The shares spent a few days just below the 20-day in early January, the only time they were staring up at the trendline since crossing above it on November 1. We are therefore using the 20-day as the basis of this week’s bullish trade. The short put strike of our spread sits just below the 20-day, which is about 6% beneath Friday’s close.

If you agree that the stock will continue trading above, or at least near, the 20-day moving average (blue line), consider the following credit spread trade that relies on ISRG staying above $350 (red line) through expiration in 7 weeks:

Buy to Open the ISRG 15 Mar 345 put (ISRG240315P345)
Sell to Open the ISRG 15 Mar 350 put (ISRG240315P350) for a credit of $1.00 (selling a vertical)

This credit is $0.10 less than the mid-point price of the spread at Friday’s $374.76 close.   Unless ISRG surges sharply at the open on Monday, you should be able to get close to that price.

The commission on this trade should be no more than $1.30 per spread. Each spread would then yield $98.70. This trade reduces your buying power by $500, making your net investment $401.30 per spread ($500 – $98.70). If ISRG closes above $350 on Mar 15, the options will expire worthless and your return on the spread would be 25% ($98.70/$401.30).


It is often said that options are to stock trading as chess is to checkers. I was looking to find the chess master amongst the checker’s champs, and Terry is the one. Looking for very smart yet understandable way to trade options? Look no further. ~ Phil Wells

Remember to click here, select Sign Up Now and use Coupon Code D21M to start a monthly subscription to Terry’s Tips for half off. And get Terry’s eBook for free.

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Making 36%

Making 36% – A Duffer's Guide to Breaking Par in the Market Every Year in Good Years and Bad

This book may not improve your golf game, but it might change your financial situation so that you will have more time for the greens and fairways (and sometimes the woods).

Learn why Dr. Allen believes that the 10K Strategy is less risky than owning stocks or mutual funds, and why it is especially appropriate for your IRA.

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