Momentum Option...'s  Instablog

Momentum Options Trading
Send Message
We are a poweful option trading newsletter that focuses on momentum stocks. Momentum can be used to the upside or downside to play call and put options on stocks that are in a clear trend. We target triple-digit returns for all option trades while trying to keep losses at 50%. We have 3-year... More
My company:
Momentum Options Trading LLC
My blog:
Daily Stock and Option Market Commentary
  • Apple (AAPL) Beats Estimates, Cree (CREE) Gets Creamed 0 comments
    Jan 19, 2011 9:06 AM | about stocks: AAPL, CREE
    9:00am (EST)

    The bulls managed to pull off a huge upset yesterday as the rattled the bears despite being heavy underdogs before the bell. There were a number of Debbie Downers on Apple (AAPL, $340.65, down $7.83) but shares finished the day down just 2% after falling to a low of $326 shortly after the open.

    A lot will be made of the company’s CEO taking a medical leave of absence and the subject will get old quickly, but no matter what happens over the near-term, Apple is not going to miss a beat. Too bad it’s a $300+ stock because it makes playing options on the stock expensive.

    With Apple recovering, Tech rebounded and the bulls were able to enjoy a cigar.

    The Dow gained 50 points to close at 11,837 on Tuesday and made its first close above the 11,800 level since June, 2008.  The index hit a high of 11,858 and our 12,000 target we have had in place since October is just over 1% away. We have mentioned we are expecting a slight pullback afterwards but we are going on record by saying the index could reach 13,000 by yearend. Of course, a lot has to go right but the chart is pointing towards 12,500 and then 13,000 for the Dow, longer-term.

    The S&P 500 added 2 free throws and ended at 1,295.  The index is within spitting distance of our 1,300 target and we mentioned a run to 1,325 could be possible on some fluff. Our weekend work revealed some nice targets for the S&P as well. If things go right in 2011, the index could see 1,450-1,500 by Christmas.

    Tech struggled for much of the morning but battled back and stayed positive shortly after lunch. The index managed a 10 point pop when the dust settled and was last seen standing at 2,765. We mentioned our 3,000 target could be a stretch over the near-term but further signs are pointing towards a possible run to 3,400 over the next 12 months.

    Shares of Cree (CREE, $62.71, down $1.06) are getting taking to the woodshed this morning after the company missed Wall Street’s estimates. The company reported a profit of $49.8 million, or $0.45 a share, up from $33.8 million, or $0.32 a share, in the year earlier period. Revenue jumped nearly 30% to $257 million from $200 million. Excluding charges, the company would have earned $0.55 a share which was still well short of the $0.59 a share expected while there revenue number missed by $20 million. 

    Cree tried to do damage control as they said earnings were lower than expected due to lower LED component sales but shares are getting spanked in pre-market action. Cree is down nearly $10 and is under $53. It’s 52-week low is $47-and change. 

    As we head to press, futures are mixed; Dow (-6); S&P 500 (-3); Nasdaq 100 (+2). Subscribers, check the Members Area for the updates.

    Stocks: AAPL, CREE
Back To Momentum Options Trading's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


More »
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.