The curious case of higher implied volatility in out-of-the-money calls than the correspondingly distant OTM puts continues in a lot of high flying names. This is neither good nor bad, rather a data point we can use to our advantage when crafting bullish trade designs.
One such name that's on our radar which also made the cut in ASC's latest Under the Hood report is everyone's favorite blue bird -- Twitter $TWTR.
In a recent report to ASC Institutional subscribers, the team laid out a case for strength in the Homebuilding sector as several components are approaching breakout levels from monster bases. Its relative strength vs. the S&P 500 over the past month is evidence that the year-to-date leadership from this group is likely to continue for now.
One of our favorite opportunities that was discussed in last week's Under the Hood segment finally triggered our entry today. And continued elevation of options premiums in out-of-the-money calls sets up a great way for us to participate in a bullish move in a limited risk fashion.
A sexy name that has been in vogue since the coronavirus pandemic sprang up is showing signs of breaking out again from a high consolidation pattern. And unless you've been hiding under a rock the past 6 months, you've probably used their product.
I'm pretty charged up about another opportunity from the Under The Hood report that is setting up today.
If the markets stabilize soon, this feels like one of the names due for a pop. And thanks to the "Robinhood" options trading speculators, there is plenty of juice in out-of-the-money calls for us to take advantage of to leverage into a good trade.
We're seeing a lot of follow thru in names that have been highlighted in previous Under the Hood reports. After a brief shakeout, many of these names are back above our levels of interest and are beginning to work (Pinterest $PINS is one brightly shining example!).
The latest one that has the most appealing setup to me is Datadog $DDOG from the SaaS space.
I was chatting backchannel with our analyst Steve Strazza today and he brought this chart to my attention:
Look at those two failed breakdowns below support! And now, it's looking like it is getting pretty serious about breaking the magic one-hundred-dollar line and following through significantly higher.
In a recent Under the Hood piece, we highlighted a software name that is breaking out of a major base and happens to be in the news -- which has the social medias chirping.
Price action today is giving us a good opportunity to get in on a pullback for an opportunistic bet for potentially uncapped gains.
The stock that has caught my attention was mentioned in the most recent All Star Charts monthly conference call and it's setting up in a nice base just above our buy level, with plenty of room to the ASC profit target.
Sometimes, I can't help myself when a good pun presents itself. Especially when I can use it to express my inner geekiness in options trading.
This name should be so obvious, it has "interest" in its name.
Whatever your geopolitical, global macro, moral, or ethical concerns are about the price of gold and its implications about the US dollar, the Fed, the US Economy, etc --- the only truth is price.
And price is telling us that Gold is setting up for another run higher.
I don't trade Chinese stocks often. But when I do, I most definitely define my risks up front. I don't want to be the next person to become "UnLuckin'd", if you know what I mean...
With that in mind, there's a chinese stock that showed up on our recent Under the Hood report that has caught my interest for a tactical play.
