EOT Position Update – September 23, 2009

September 23, 2009

Market Snapshot

The markets are in a holding pattern this week.

Investors are waiting for the next clue about what the future holds.  They’ll get it from Fed Chairman Ben Bernanke later today.

Bernanke previously said the recession’s ending but we’re not out of the woods yet. We’ll likely see interest rates stay unchanged at 0% to 0.25%.  And the programs to support the credit markets stay in place.

This is good news for the market… Cheap money makes investing in stocks attractive.

Right now, I think this is the calm before the storm.  The storm will kick up once the Q3 earnings season gets going in a few weeks.  If companies are able to beat earnings estimates on increasing revenue, we’ll see the amazing rally continue.

I’ll be keeping a close eye on technology stocks again.  They’ll be the canary in the coal mine.  If their earnings and revenue are able to beat estimates, the rest of the economy should be right behind.

Now for the updates…

Position Updates

Just a quick note:  Remember, we won’t update every open position every week.  I try to focus on the positions that have some significant news or price movement.

  TQNT Feb 2010 $7.50 CALLS (TQNBU)
TQNT is our latest trade we sent out yesterday.  The stock has bounced off support at the 20-day moving average.  Our option is moving higher, but you can still get in under our buy-up-to price today.  Hold tight for TQNT’s next move higher.  Resistance is at $9 and $11.  Support is at $6.75 and $6.

  ININ Dec 2009 $20 CALLS (NQXLD)
ININ looks like it’s going to follow the same pattern it’s been in for the last six months… A strong rally followed by a pullback to the 50-day moving average, then rocketing higher again.  Right now it’s pulling back to the moving average.  ININ should move higher once it reaches this support level.  Hold tight for now.  Resistance is at $22.25 and $25.  Support is at $16.50 and $14.

  MMM Jan 2010 $75 CALLS (MMMAO)
3M’s been flat since breaking through our first resistance level last week.  In my opinion, this is nothing more than a short pause caused by technical resistance. Aggressive traders should hold tight for bigger gains.  The next resistance is at $80. Support is at $65 and $60.

  UEPS Oct 2009 $17.50 CALLS (QBSJW)
Net1 hit a new high of $4.50 this week.  Good for a whopping 275% gain!  It’s beyond both of our resistance levels.  Only the most aggressive traders should still be holding this option.  UEPS’ momentum should carry it higher from here.

  GT Jan 2010 $20 CALLS (GTAD)
Goodyear is trading inside of the upper and lower trend lines.  That’s a good sign the uptrend is still intact.  The next move should be higher from here.  We still have plenty of time.  Hold tight for now.  Resistance is at $22 and $25.  Support is at $14 and $12.

  MRO Oct 2009 $35 CALLS (MROJG)
MRO made a strong move last week to close above resistance at $33.60.  But renewed strength in the dollar has sent oil and MRO back below this level.  The good news is the crude oil chart is set up for a big breakout higher.  Hold tight for now.  Resistance is at $35 and $40.  Support is at $26 and $25.25.

 PEGA Dec 2009 $25 CALLS (PQMLE)
PEGA continues to set new highs.  Our options hit a peak gain of 343% today!  Only the most aggressive traders should still be holding these options.

Category: EOT Update