Anyone who traded in the late 90’s only referred to Microsoft stock as “Mister Softee.” It was stupid, as many stock nicknames were, but that’s what it was. And you seemingly couldn’t go a day without hearing “Mister Softee is making new highs!” from summer 1998 until early 2000.

I almost have PTSD from it.

Fast forward to today. Microsoft doesn’t get the same media attention today as it did back then, now being overshadowed by the Amazons, Facebooks, Googles, Apples, and Teslas, of the world. But the price action is definitely giving me flashbacks.

And the ASC research team has a gaudy 323 price target for Microsoft $MSFT over the next several months which has me interested in playing along with options. [Read more…]

As August gets under way, it’s time to review positions with August options that remain open (haven’t already hit profit targets or been stopped out).

Most trades I put on for All Star Options tend to have a minimum duration of 30 days (short premium plays) and often as long as 6-8 months (for long premium plays). As options approach expiration, greeks like theta and gamma start to become my enemy and whipsaw my P/L. Therefore, as options and spreads get into the expiration month, my best practice is to put each position on notice — it’s time to take action. [Read more…]

The title of this trade plan is a modified take on a famous old floor traders saw. Basically, when experienced floor traders saw the entire pit screaming to hit the same bid or offer, the rule of thumb was to give ’em what they want. Take the other side and close your position when all those same lemmings try to hit the exits at the same time too.

It was the second easiest money on the floor (first was “trading against paper” — which is you and me.)

The trade I’m putting on the board is a loose take on this idea. But instead of fading direction, we’re going to fade the volatility premium priced into Gold options today. [Read more…]

JC’s been pounding the table to me about Abbott Labs $ABT for a couple weeks now.

I’ve been slow playing it, waiting for some new highs. We’re getting them now. It’s time to get involved.

The base $ABT formed over the last three months is a thing of beauty. And the fact that it’s in a hot sector and printing new all-time highs is only sweetener. Then when you add in the fact that options premiums are at the lowest levels since March and I’m starting to get pretty excited. [Read more…]