EOT Position Update – April 8, 2015

| April 8, 2015

Market Snapshot

The first quarter of 2015 is in the books.  And earnings season is just about to get underway.

As I’ve pointed out before, the economic fallout from the drop in oil prices isn’t completely understood at this point.

Sure, it’s good for consumers when oil prices go down.  But the ramp up of US oil production has been one of the primary drivers of the US economy in recent years.

The dramatic drop in oil prices is triggering layoffs at oil companies and all of the other companies that were catering to the oil business.  There’s still more pain to come here.

The most recent employment numbers highlighted just how little some economists understand about the economy.  It’s simply stunning how wrong these guys are more often than not.

They simply extrapolate what has been happening over the past few quarters out into the future.  And the Fed is full of these same economists that don’t have a clue how to use common sense is setting monetary policy.

We’re seeing the Fed beat a hasty retreat back to a much more dovish commentary on interest rates after the latest jobs data.

Their hawkish talk on interest rates was clearly a bit premature given the weakness in the global economy, strength of the US Dollar, and lack of real wage growth in the US.

This mixed bag is holding the S&P 500 in check.  This has certainly been a period of consolidation for stocks.  And I’m looking for areas that should lead the markets next move.

Let’s move onto the updates…


Position Updates

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

BSX May 15th 2015 $18 Calls

BSX is our most recent trade.  The stock is up 1% today as bullish momentum carries the stock higher.  Our option is up 33%.  Continue holding… Resistance is at $18.50 and $19.00.  Support is at $17.00 and $16.00.

CDW June 19th 2015 $40 Calls

CDW is having a great day.  The stock is up more than 2% and it’s on the verge of making a new high.  Continue holding for the next leg higher.   Resistance is at $40.00 and $42.50.  Support is at $36.00 and $34.00.

WEN May 15th 2015 $11 Calls

WEN’s consolidation phase has continued into the second quarter.  The good news is there hasn’t been much selling… it’s a lack of new buyers. So far buyers have been willing to step in anytime WEN falls to $10.50.  I’m expecting to see renewed buying interest push the share price toward resistance at $12.00 and $13.00 in short order.  Support is at $10.20 and $9.50.

Category: EOT Update

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