Optioneering Newsletter Sep 18
Optioneering Newsletter Sep 18
Optioneering Newsletter Sep 18
TQQQ Monthly
After a pair of deep corrections that occurred last year and early this year,
TQQQ is on the verge of breaking out to a new record high. New record
highs are bullish.
TQQQ Daily
The daily chart shows that QQQ was very bullish from the June low to the
early August high. Then TQQQ went sideways for a few weeks. Now,
TQQQ appears be poised for a break through the month long flat top. An
upside breakout would point to a further advance.
TQQQ is a leveraged ETF. While leveraged ETFs contain more risk, they
usually possess higher premiums as a result. We suggest taking advantage
of the high premiums offered by initiating debit spreads.
We can see from the Call Option Spread Analysis Calculator that if the
TQQQ ETF price declines by -5%, stays where it is, or increases in price
when the options expire, the spread will make a 27.5%, or $280 profit. If the
TQQQ ETF price is down -7.5% when the options expire, the spread will
lose -1.3%, or -$13.
The daily chart shows that FB has been very bullish since the June low.
The quick pullback from this month’s high gives us a new buying
opportunity.
We can see from the Call Option Spread Analysis Calculator that if the FB
stock price declines by -2.5%, stays where it is, or increases at all when the
options expire, the spread will make a 26.6% or $315 profit. If the FB stock
price is down -5% when the options expire, the spread will make 6.5% or
$77. If the FB stock price is down -7.5% when the options expire, the
spread lose -20.8% or -$246.
AMZN Monthly
The monthly chart shows that AMZN has been in a strong bull trend since
the chart started in 2009. As you can see, it just hit a new record high this
month.
AMZN Daily
The daily chart shows that AMZN has been very strong since the April low.
When we enter bullish positions, we want to be long the strongest stocks.
Amazon is one of the strongest of all. The little pullback gives us a new
buying opportunity.
We can see from the Call Option Spread Analysis Calculator that if the
AMZN stock price declines by -5%, stays where it is, or increases at all
when the options expire, the spread will make a 29%, or $675 profit. If the
AMZN stock price is down -7.5% when the options expire, the spread will
lose -13.4% or -$312.
The last profit opportunity we will consider this week is in Jack, or Jack in
the Box, Inc. Jack in the Box is a San Diego based restaurant company
that operates and franchises Jack in the Box restaurants, one of the
nation’s largest hamburger chains, with more than 2,200 restaurants in 21
states and Guam, and Qdoba Mexican Eats, a leader in fast-casual dining,
with more than 600 restaurants in 47 states, the District of Columbia and
Canada.
Jack Monthly
JACK went straight up from the 2011 low until the 2015 high. Then, in
August 2015, the bottom fell out and JACK experienced a very sharp drop.
After that, there was some base building and now we have a resurgent bull
trend with a new all-time high early this month.
JACK Daily
The daily chart shows that Jack has been very bullish since the May low.
The current pullback gives us a buying opportunity.
Traders who want to employ a more leveraged approach can buy JACK
calls. JACK has options expiring in October, November, December, and
March.
Buy to Open JACK December 16th expiration 85-Strike Call
Sell to Open JACK December 16th expiration 95-Strike Call
We can see from the Call Option Spread Analysis Calculator that if the
JACK stock price declines by -2.5%, stays the same as it is now, or
increases in price at all at when the options expire, the spread will show a
profit of 35.1% or $260. If the JACK stock price is down -5% at expiration,
the spread will make a 26.7%, or $197 profit. If JACK is down
-7.5% when the options expire, the spread will lose -6.9% or -$51.
EARNINGS SEASON: There are four “Earnings Seasons” a year. The seasons begin in
January, April, July, and October and they each last about two months. The earnings
reports can have an impact on the stock price. We don’t know if the impact is going to
be positive or negative (or nothing at all). It’s up to you to decide if you want to be in a
trade when the earnings report is announced. Here’s a link for a page that can help you
keep track of the report dates:
https://www.earningswhispers.com/calendar
Note: Profit performance displayed in this newsletter does not include transaction
costs.
This newsletter includes some trading ideas following Chuck Hughes’ trading
strategies along with educational information. For a complete listing of Chuck’s
exact trades, including specific entries and exits and real time Portfolio tracking,
please call Brad at 1- 866-661-5664 or 310-647-5664