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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 6-year... More
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  • FedEx (FDX) Option Trade Up Nearly 70%
    7:15pm (EST)

    We recommeded some FedEx (FDX, $95.21, up $1.22) call options on Monday night as a "Free Trade" and said to get into them on Tuesday if you get them for under $1.25.

    We profiled the FDX January 100 calls (FDX110122C00100000, $2.00, up $0.35) and told our subscribers to close half of the trade at $2.15.  The options have nearly doubled in two days and we wanted to protect profits.

    We think shares still have a shot at passing $100 but it's wise to take profits when you make nearly 70% in 2 days.

    We will continue to monitor the position and keep you posted.
    Dec 02 7:15 PM | Link | Comment!
  • Krispy Kreme (KKD) Reports Sweet Numbers, December Call Option up 200%

    12:50pm (EST)

    The momentum continues...

    Futures were erratic this morning but all signs were pointing towards a higher open as Wall Street and the bulls tried to figure out the latest economic news.

    nitial weekly jobless claims were out before the bell and came in at 436,000, which was up 26,000 week-over-week and greater than the 422,000 number that had been expected.  There wasn't much panic but futures did drop before rebounding as traders found relief in the four-week moving average for jobless claims which now stands at 431,000, down for the fourth straight time since late October.  Continuing claims came in at 4.27 million, up from 4.22 million.

    Elsewhere, pending home sales index rose 10.4% month-over-month to 89.3, which was better-than-thought as sales had been widely expected to remain flat.  The bulls pushed the market higher after hearing the news and the indexes are near their best levels of the day.

    In earnings news, Krispy Kreme Doughnuts (KKD, $7.29, up $1.13) is surging 18% after reporting better-than-expected results.  The company reported a profit of $2.4 million, or $0.03 a share, versus a loss of $2.4 million, or $0.04 a share, in the year ago quarter.  Sales were up 8% to $90.2 million.  The suit-and-ties were glazed as they had expected Krispy’s numbers to come in flat.

    Wow.  What a move in the stock and we overlooked this one on our Watch List.  We had listed it in our Weekly Wrap that the company would be reporting earnings on Wednesday, after the bell, and we missed a golden opportunity on a couple of option trades.

    Let’s say we were bullish on Krispy Kreme and thought they would beat earnings.  We have followed the stock for years and there is usually a big move after earnings, which is what we have seen today.  The stock is “cheap” and trades at option prices so the safe way would have been to buy the stock.

    However, if you had played the Krispy Kreme December 5 calls (KKD101218C00005000, $2.20, up $1.05), which closed at $1.15 yesterday, you would be up 90%.  The December 7.50 calls (KKD101218C00007500, $0.30, up $0.20) are up 200% and you could have got them all day long for 10 cents on Wednesday.

    Of course, we have our own good news going with our current trades as a few our approaching triple-digit gains.

    As we head to press, the Dow is up 92 points to 11,348.  We are looking for a push to 11,400 which would clear the way for a run to 11,600-11,700 by yearend.  Support is at 11,200 and 11,000.

    The S&P is higher by 12 points to 1,218 and we are looking for a run up to 1,220-1,225.  A close above these levels could get us to 1,250.

    The Nasdaq is showing an advance of 21 points and is at 2,570 and within spitting distance of our 2,600 target.

    We are a little cautious ahead of tomorrow’s big jobs report but we think the market can end the week on a high note.  The trend has been bullish after a couple of weeks in a tight range and we want to continue to ride that momentum for another couple of weeks.  The fund managers are trying to play catch-up so things are looking good.

    Subscribers, check the Members Area for the updates.  We also have some exciting news coming concerning our Weekly Wrap and we will update you on that news on Friday.  We will be back in the morning with a fresh update.

    Disclosure: No positions
    Dec 02 12:54 PM | Link | Comment!
  • FedEx Options Zoom 150% and 185% on 4% Stock Move
    8:30pm (EST)

    We wanted to do a quick update on FedEx (FDX, $91.59, up $4.09) following today's 4% pop.  We have recommended options on FedEx in the past and it is a stock we watch closely.  We were going to profile an option trade last week but we didn't want to go long in front of a holiday and before the weekend.  We also have a number of open trade recommendations so we are also at our max comfort level as we would like to close a few before opening new ones for our subscribers.

    Shares of FedEx have been establishing strong support at $85-$86 over the past few weeks and we felt it was a stock we could play heading into the Christmas season. 

    We knew a lot of focus would be on (AMZN, $179.49, up $2.29) and possibly eBay (EBAY, $30.23, down $0.92) but we thought those trades might get "crowded" so we wanted to get into FedEx because they will doing a lot of the shipping over the holidays and we expect business to be brisk.

    We mentioned all three stocks in our daily update today but FedEx is our favorite over the short-term.  The 52-week high is $97.75 and we watched the December 90 calls (FDX101218C00090000, $3.45, up $2.07) open this morning at $1.71.  In our 12:30 update the options were trading for a little over $2 and added another 50% by the closing bell.

    Although it may be a little late to get into the December options, we also like the January 100 calls (FDX110122C00100000, $1.00, up $0.65) which soared 185% today after opening at 42 cents.  We have these options listed on our Watch List section but it is not an official recommendation (yet).

    Another reason we like the January options is because they provide more time for this trade to play out.  The December options expire in less than 3 weeks before they expire but the January options have over 50 days before expiration. 

    We think there is still more upside for shares of FedEx and we went on record today saying we think shares can hit $100 over the short-term.  If so, these options could easily double.  If you can get into the January 100 calls for under $1.25 on Tuesday morning, pull the trigger.

    Disclosure: No positions in FDX as of this writing
    Nov 29 8:38 PM | Link | Comment!
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