Today's trade comes from the latest Young Aristocrats report. And today's dip offers us a chance to get into this trade with a very nearby risk management level (today's low). Either this stock is going to make a run or it's going to fail, and we'll likely find out quickly.
As such, we're taking a long position in October call options.
...but it might win us cash-money gains, which is all we're really here for anyway. Give the participation trophies to the strivers.
Today's trade comes from a "dirty" sector. One some investors don't like to talk about in polite company. And it certainly won't win us any friends in the ESG crowd. But again, who cares?
During our morning Analyst meeting today, the team was looking across a variety of asset classes and sectors to identify the current leaders, and those likely to continue tracking higher if the broader stock market rally is for real.
One sector that stood out starkly was Big Pharma.
There are some monster bases in the process of resolving higher here.
Every idea that we put on at All Star Charts starts with a technical setup that we like. We are students of price action and that supercedes everything.
It's nice when our technical analysis lines up with "other" factors that may support our idea, be they fundamental, news, or in this case, insiders and activist activity.
Here's what our team noticed in an email to ASC subscribers earlier this week:
The most significant insider transaction on today’s list is a Form 4 filing for Pinterest $PINS.
Now that the second quarter blackout period is behind Pinterest, CEO William J. Ready is also buying shares. He just reported a rather sizable $5 million purchase.
We can’t think of many things more bullish than the CEO getting involved following the insider activity from Elliott last week.
CEOs and Activists buying big positions? That has our attention.
It's a big wide world out there. Luckily for us investors in the U.S., we aren't just limited to trading domestic companies. Often via ADRs, we are able to participate in opportunities in the very best foreign companies and conglomerates.
And right now, there are good opportunities shaping up in if we look overseas at some banking stocks.
Earlier this week, we got stopped out of Vertex Pharma $VRTX for a manageable loss. It happens. Now today, a vortex is pulling us in the direction of another Vertex -- Vertex Energy $VTNR. Crazy, huh?
In the end, stocks are all just ticker symbols with dollar signs attached to them that convey any kind of meaning to us. But nonetheless, what are the odds?
Weird coincidences aside, we're liking the setup in this energy name so let's get right to it.
If tech stocks are signaling that a bottom is in, we're of the mind that we'll find some significant beta in a badly beaten household name: The recently renamed Meta $META (otherwise known as Facebook...).
Chatting with JC this morning, he was drawing a comparison of META to what Gold Miners $GDX did in 2016:
While I prefer to let stocks prove themselves to me before taking a position, sometimes a situation sets up where the stars are aligning for a low risk bet that makes it worth the effort to get ahead of the crowd.
One such situation has developed in a name discussed recently in our Hall of Famers report.
We've experienced a pretty powerful bear market rally on the heels of yesterday's Federal Reserve interest rates announcement. Whether or not it sticks is anybody's guess. But one name in the financials space has stood out for its relative lack of participation in the recent rally off the bear market lows.
Stocks like these are the ones we want to leverage into bearish portfolio hedges. So let's get right to it.
Ok, maybe that title is a little dramatic. I couldn't help myself. I recently had a conversation with a trader friend who was dunking on Gold Bugs about the lack of income stream from Gold. It's just a damn rock! he said.
Anyway, I don't have any strong opinions about Gold either way. I just like to follow price and volatility. And right now, the options market may be offering us a tempting opportunity to collect some premium as the recent gold selloff has spooked the gold bulls a little bit.
The latest Quarterly Playbook is out, which has given us a bunch of ideas to begin exploring.
One idea stood out for me in particular because of a recent pullback offering a good entry point. It's in a bellwether dividend-paying stock that we wouldn't mind owning for the long term, but we're going to take advantage of elevated options premiums to leverage into a high-probability bet for some opportunistic income.