Sami Abusaad’s Trade of the Week: NLNK
In this special video, Nightly Game Plan Moderator Sami Abusaad walks you through a winning trade in Newlink Genetics (NLNK). Biotechnology stocks have been hot as of late, but few are hotter than NLNK, which recently skyrocketed on positive results from a clinical study. After NLNK’s rally, Sami spotted the opportunity for a Climactic Sell Setup, giving him a profit of over $3,100 in 4 days*. Here’s how the trade worked: *(click here for a breakdown of our P&L calculations) In the video, Sami’s going to walk you through the trade from start to finish so you can understand: Why NLNK showed up on his radar What qualified NLNK as a climactic play Where Sami set his entry, stop, and target for a 3:1 reward:risk ratio How the Climactic Sell Setup works Why he used the 5-minute time frame on this trade The pattern that signaled a breakdown in NLNK was coming Click here to learn about Sami’s Nightly Game Plan
Continue Reading -->Trader’s Digest: The 10 Stories We’re Reading Right Now
Wonder what traders are talking about today? We’re here with the top 10 stories we’re sharing with colleagues today, covering topics like:Why Apple May Have Pulled Off a Genius Move with the $1,000+ iPhone XAn important lesson learned from superstar money manager Seth KlarmanHow T3 Live’s Jeff Cooper spotted a home run trade in Fairmont Santrol Holdings (FMSA)And more! So check out these links right now and get up to speed: 1) Don’t laugh — that $1,000 iPhone could be a genius move for Apple (MarketWatch) Is the $999 price tag for the iPhone X too high? Some people clearly think so. They think Apple has finally overreached. They think this thing could be Tim Cook’s folly. Apple stock, which had risen on news of the new cellular Apple Watch, slid after the high-end phone was unveiled. Read the Story ==> 2) Markets Are Hard: Seth Klarman Edition (A Wealth of Common Sense) Klarman isn’t as well known to the general investing public as some of his peers but his track record ranks right up there in terms of the greatest of all-time. When someone like Klarman makes these types of warnings it’s hard to ignore. Read the Story ==> 3) Secrets of Successful Speculation: Riding the FMSA Rocket (T3 Live) A trader’s job is to narrow one’s field of vision and cull for the very best setups: the more one tries to see, the less one sees. In this game, there is so much going on that it’s easy to get overwhelmed. As the old saw goes, less is more. Continued Reading ==> 4) Top House Tax Writer Says Overhaul Framework Coming Week of Sept. 25 (Bloomberg) Kevin Brady, the chief House tax writer, told the chamber’s Republicans that White House advisers and congressional leaders working on a tax plan will release a framework the week of Sept. 25. Specifics, including such basic matters as where to set the corporate tax rate and how to set up individual tax brackets, have yet to emerge. Continued Reading ==> 5) Brazil police detain JBS CEO Batista on suspicion of insider trading (Reuters) Brazil’s federal police on Wednesday detained the chief executive officer of JBS SA, the world’s No. 1 meatpacker, saying he used insider information to avoid hefty losses related to a plea bargain signed earlier this year. Continued Reading ==> 6) Pandit Says 30% of Bank Jobs May Disappear in Next Five Years (Bloomberg) Vikram Pandit, who ran Citigroup Inc. during the financial crisis, said developments in technology could see some 30 percent of banking jobs disappearing in the next five years. Artificial intelligence and robotics reduce the need for staff in roles such as back-office functions, Pandit, 60, said Wednesday in an interview with Bloomberg Television’s Haslinda Amin in Singapore. Continue Reading ==> 7) 9 Ways to Destroy Your Account with Options (T3 Live) Options trading is fun. Options trading is sexy. And options trading can destroy your account if you don’t know what you’re doing. Continue Reading ==> 8) Why Is North Korea So Interested in Bitcoin? (FireEye) In 2016 we began observing actors we believe to be North Korean utilizing their intrusion capabilities to conduct cyber crime, targeting banks and the global financial system. This marked a departure from previously observed activity of North Korean actors employing cyber espionage for traditional nation state activities. Continue Reading ==> 9) U.S. middle-class incomes reached highest-ever level in 2016, Census Bureau says (Washington Post) The incomes of middle-class Americans rose last year to the highest level ever recorded by the Census Bureau, as poverty declined and the scars of the past decade’s Great Recession seemed to finally fade. Continue Reading ==> 10) Miami Nun Uses Chainsaw to Remove Downed Trees (CBS Miami via YouTube) Hurricanes Harvey and Irma did untold amounts of damage to countless families. But it’s also brought out the best in Americans all across the country, as everyday people step up to help their neighbors. In this video, watch a nun pick up a chainsaw to clear trees in her Miami neighborhood. As a YouTube commenter pointed out, she wasn’t exactly following chainsaw safety protocol, but it’s heartwearming nonetheless…
Continue Reading -->Traders Are Betting on a Market They Hate
Last week, traders got fairly bullish following the massive bounce off Tuesday’s spike low. This week, things are tricker. The North Korea situation is not going away, Hurricane Irma is on the horizon, and the safety trade is picking up, with Treasury yields dropping like rocks. So let’s see what kind of mood the bull is in ahead of the weekend. (click here for a primer on the sentiment indicators below) 1) VIX Spread – Bullish The VIX hit a low of 10.02 last Friday morning, putting it in close range of generational lows. It’s hovering around 12 today. The 3-month spread is at +3.10, which means traders are somewhat bullish. However, they’re clearly not as bullish as last week when this reading was at +4.41. Readings of +5 should be considered outright froth, so we’re not even close to that territory. (click here for a primer on the VIX spread) 2) CNN Fear & Greed Index – Bearish The Fear & Greed Index is at 38, down from 46 last Friday. The F&G Index operates on a 1-100 scale, and a reading of 38 qualifies as modestly bearish. 3) AAII Sentiment – Bearish The latest AAII Sentiment Survey shows that 29.3% of individual investors are bullish. This is up from 25% last week. This 29.3% reading indicates that individual investors are slightly bearish. 4) CBOE Equity Put-Call – Bullish The CBOE Equity-Put Call ratio was at 0.55 Thursday, which is well below the long-term average of 0.655. The 3-day moving average is 0.5933, which is below the long-term average and thus bullish. These numbers indicate that traders are very bullish Conclusion Out of 4 sentiment indicators, we have: 2 bullish (flat from last week) 0 neutral (down from 1 last week) 2 bearish (up from 1 last week) We have 2 bullish, 0 neutral, and 2 bearish indicators this week. This is a slight degradation from last week, when traders were in a fairly buoyant mood. I find it interesting that the CBOE equity put-call ratio has been so bullish as of late. The equity put-call has been below the long-term average for 9 of the past 10 days. Unless traders are shorting massive amounts of calls, it looks like there are a whole lot of folks betting on a big rebound to new all-time highs above SPX 2490. This implies some level of complacency. However, the AAII Sentiment Survey remains depressed, even though the SPX is less than 2% off the record. This says that a lot of people are sitting on the sidelines, or are at least worried about the market. And that’s been a common trend all year. Bullish AAII readings have averaged just 32.9% this year. Let’s compare that to 2007, since people love comparing current market conditions to the last top, even though using a sample size of 1 is completely unscientific. From the start of 2007 to 9/6/2007, bullish AAII readings averaged 41.8%. So the overall market picture is pretty weird. I suspect that for some time, traders have been holding their noses while hitting the buy button, and that certainly seems to be the case today. There’s a lot of money riding on an extension of the bull market. But people don’t trust it. Isn’t it ironic?
Continue Reading -->Morning Call Express: Calm Before the Storm
In today’s Morning Call Express video, T3 Live’s Kurt Capra breaks down the market action ahead of the weekend. Kurt covers: This week’s contraction in volatility What could signal more momentum to the downside Levels that could indicate a move back to all-time highs The down move in financials The strength in gold (GLD) and gold mining stocks (GDX) The downtrend in the US dollar P.S. Looking for Scott Redler’s Morning Call videos? They are only available to Redler All-Access subscribers. Click here to learn more.
Continue Reading -->Trader’s Digest: The 10 Stories We’re Reading Right Now
Wonder what traders are talking about today? We’re here with the top 10 stories we’re sharing with colleagues today, covering topics like:The retirement of Fed Vice Chair Stanley FischerWhat the iPhone will change about smartphones foreverHow a Navy SEAL commander thinks you should start your dayAnd more! So check out these links right now and get up to speed: 1) Fed Vice Chairman Fischer Resigns, Says Economy Is Stronger (Bloomberg) Federal Reserve Vice Chairman Stanley Fischer has resigned effective on or around Oct. 13 after serving three years at the U.S. central bank. Fischer, 73, was appointed to the Fed by President Barack Obama in 2014 to a term as vice chair that would have expired in June 2018. He cited “personal reasons” in a Sept. 6 resignation letter to President Donald Trump, released Wednesday by the central bank. Read the Story ==> 2) Kohl’s is the latest retailer to partner with Amazon, selling Echo devices in its stores (CNBC) Add Kohl’s to the list of brick-and-mortar retailers signing deals with Amazon. The department store chain unveiled plans on Wednesday to roll out a “smart home experience” in 10 stores, ahead of the holiday shopping season. Read the Story ==> 3) Scott Redler’s Chart Attack: SPX, QQQ, IBB, AAPL, NFLX, TSLA (T3 Live) T3 Live Chief Strategic Officer Scott Redler breaks down 6 key charts so you can understand how he’s reading the rocky market action. Continued Reading ==> 4) A legendary volatility pioneer says one of the market’s hottest trades is like ‘betting on the roulette’ (Business Insider) One of the market’s hottest trades this year has involved betting on stocks to sit still. The wager in question is shorting the CBOE Volatility Index, or VIX, and many investors are big fans. Following a recent short-term increase in the VIX, traders added almost $400 million of exposure to the trade. One guy — a former manager at Target — says he’s made millions betting against the VIX. Continued Reading ==> 5) Three things that will never be the same after the iPhone 8 (The Verge) Apple, like everyone else, sometimes takes multiple iterations to complete its most ambitious goals. But as we face up to the culmination of another year of hyped-up iPhone speculation, I do see three particular ways in which the iPhone 8 (or whatever Apple calls its new flagship) will indeed be the harbinger of massive and irrevocable change. Continued Reading ==> 6) Hurricane Irma batters Caribbean as Florida braces for weekend landfall (Reuters) Monster Hurricane Irma slammed across islands in the northern Caribbean on Wednesday, packing a potentially catastrophic mix of pounding winds, raging surf and rain en route to a possible Florida landfall this weekend. Continue Reading ==> 7) 7 Ways to Be Just Another Failed Trader (T3 Live) Do you want to fail as a trader? Do you want to miss your next mortgage payment? Or pull your daughter out of private school because you can’t make tuition next month? Well you’re in luck! Because we’ve got 7 surefire tips for failing as a trader. Continue Reading ==> 8) The ‘demonetized’: YouTube’s brand-safety crackdown has collateral damage (Digiday) This past May in New York City, YouTube held a summit for its top 100 or so video personalities, individuals and networks. It was a chance for these creators to get face time with senior YouTube executives and discuss what was happening on the video platform. One issue that some attendees felt YouTube needed to address: declining ad revenue. Continue Reading ==> 9) Putin Rejects Cutting Off Oil to North Korea (NY Times) President Vladimir V. Putin of Russia said his country opposed cutting off oil supplies to North Korea as part of new sanctions being considered in the wake of the country’s latest nuclear test, according to official accounts of his meeting Wednesday with President Moon Jae-in of South Korea. Continue Reading ==> 10) Life Advice from a Navy SEAL Commander (YouTube) Retired United States Navy Admiral William H. McRaven, a former Navy Seal has 10 tips to help you make the world a better place. And it starts with making your bed every day:
Continue Reading -->T3’s Trades of the Week: Is TSLA All Charged Up After the Long Weekend?
Welcome to the latest edition of T3’s Trades of the Week newsletter! Have you heard about Redler Ultimate Access, Scott Redler’s all-new education program? Click here to learn about how you can learn Scott’s best trading secrets.. Now let’s jump right in to this week’s trades and analysis: 1) Scott Redler on TSLA TSLA is getting tight as the upper pennant builds. Some are long from the Red Dog Reversal at $339.72. If it can hold $351 and then clear $357.50 with authority, we can add for a trade. Click here to learn about Redler Ultimate Access, Scott’s all-new education program 2) Jeff Cooper on Advance Auto Parts (AAP) I am watching AAP for a short swing trade. I would enter short at 97.50 and keep a stop at 99.50. My target for half of the position is 95.50. If it hits that target, I would cover half and move the stop down to 97.50. Click here for information on Jeff’s 181-page trading case study 3) Kurt Capra on USDJPY USDJPY bounced hard last week after taking out the prior pivot low. This morning it is trying to push back down. The action here should not come as a complete surprise as this area is a long term support level. A decisive break and close under this area will signal a much more significant move lower is to come. I am looking for this to move back to the prior low as a first step. Click here for Kurt Capra’s forex trading case study
Continue Reading -->The Bulls Are Coming Out of Their Caves
Last Friday, traders sentiment was right smack-in-the-middle neutral, perfectly reflecting the back and forth action in the market. On Tuesday, the SPX started on a very weak note, trading down to 2428.20 before the dip buyers stepped in, putting us as high as 2478.26 on Thursday. With this big rebound behind us, let’s see if traders’ moods have gotten better to close out the week. (click here for a primer on the sentiment indicators below) 1) VIX Spread – Bullish Three weeks ago, the VIX hit 17.28, but with markets steadying themselves, it hit a low of 10.02 on Friday morning, not far from generational lows. The 3-month spread is at +4.41, which means traders are very bullish. We’ve seen many readings above 4 this year, which is what I regard serious bullishness. Readings of +5 should be considered outright froth. If the SPX breaks out to new record highs, we coudl see such a reading again. (click here for a primer on the VIX spread) 2) CNN Fear & Greed Index – Neutral The Fear & Greed Index is at 46, up from just 22 last Friday. The F&G Index operates on a 1-100 scale, and a reading of 46 qualifies as as neutral. 3) AAII Sentiment – Bearish The latest AAII Sentiment Survey shows that just 25% of individual investors are bullish. This is down from 28.1% last week. This 25.0 reading indicates that individual investors are bearish, and it’s the lowest reading since May 18. 4) CBOE Equity Put-Call – Bullish The CBOE Equity-Put Call ratio was at 0.57 Thursday, which is well below the long-term average of 0.655. The 3-day moving average is 0.58, which is below the long-term average and thus bullish. These numbers indicate that traders are very bullish Conclusion Out of 4 sentiment indicators, we have: 2 bullish (flat last week) 1 neutral (up from 0 last week) 1 bearish (down from 2 last week) We have 2 bullish, 1 neutral, and 1 bearish indicators this week. So traders are moderately bullish and in a better mood than last week. We’re definitely not in frothy territory, but if the SPX finds its footing again and blasts above 2490 to new all-time highs, that could change quickly. Whether that happens soon is unclear. On the plus side, it looks like traders are looking past today’s weak nonfarm payrolls report (or at least that was already priced in), since financials are very strong. Tech has been very resilient, but it would be nice to see small caps participate on a consistent basis.
Continue Reading -->AVAV: Anatomy of a Winning Earnings Play
In this special video, Nightly Game Plan Moderator Sami Abusaad walks you through a winning earnings play in drone company AeroVironment (AVAV). This video series is typically focused on swing trades, but since no swing trades triggered, this will be a special edition focused on Sami’s proprietary Earnings Play strategy, which he only started using this year. Sami used the Earnings Play to enter AVAV at $39.35, and exit the next morning at $44.67 for a $1,330 profit. (click here for a breakdown of our P&L calculations) Here’s how the trade went down: In the video above, Sami’s going to walk you through the Earnings Play from start to finish so you can understand: How Sami analyzed the daily trend in QQQ, which he uses as a market proxy The rationale behind the Earnings Play strategy Tips for predicting the post-earnings reaction How to judge expectations for earnings Lessons from past earnings playes like DHR, TMO, and CY Why AVAV appeared on Sami’s radar The ‘proof’ Sami got that AVAV was a bullish play Why he only took 250 shares Click here to learn about Sami’s Nightly Game Plan P.S. Earnings Season is still going strong. Be sure to check out this FREE Earnings Season resource: The Ultimate Guide to Trading Earnings Season
Continue Reading -->Trader’s Digest: The 10 Stories We’re Reading Right Now
Wonder what traders are talking about today? We’re here with the top 10 stories we’re sharing with colleagues today, covering topics like:Why gold may no longer be the safe haven you think it isApple’s plans to lock you in its iOS ecosystemHow Hurricane Harvey is bringing out the best in some peopleAnd more! So check out these links right now and get up to speed: 1) Why Gold Is Less of a Haven These Days (Bloomberg) Having waited patiently for the “any-minute-now” moment, gold investors are taking comfort from the recent rise in price in response to geopolitical tensions. Yet the responsiveness of gold, as well as the overall price, appears weaker than would have been expected from historically based models — and for understandable reasons. Read the Story ==> 2) Trump hits road to tout tax reform as helping workers (Reuters) President Donald Trump will turn his signature populist rhetoric toward tax reform on Wednesday in a speech expected to tout tax cuts as a way to help workers and the middle class in an economy “rigged” against them, senior White House officials said. Read the Story ==> 3) Scott Redler’s Chart Attack: SPX, QQQ, TSLA, BABA, and AAPL (T3 Live) T3 Live Chief Strategic Officer Scott Redler breaks down 5 key charts so you can understand how he’s reading the market action at a confusing juncture. Continued Reading ==> 4) This is Apple’s long game to ‘trap’ you inside the iPhone (Boy Genius Report) No matter how much greener the grass might get on the other side, I’m certain I’ll never leave the iPhone/Mac ecosystem. I have everything I need inside iOS/macOS that switching to other operating system seems like a very bad idea. Like me, there are millions of other people, and it looks like Apple is really interested in extending the iPhone “trap” for as long as possible. Continued Reading ==> 5) Top Analyst: Amazon is about to take off (CNBC) A widely followed research analyst said Amazon’s acquisition of Whole Foods Market will add to the e-commerce giant’s bottom line, quickly. In his first note to investors since the buy-out of the organic grocery chain became official on Monday, Mark Mahaney of RBC Capital Markets raised his estimate for Amazon’s 2018 profit by 10 percent. Continue Reading ==> 6) What Getting Punched in the Face Taught Me About Trading (T3 Live) On August 26, 2017, Conor McGregor and Floyd Mayweather squared off in the biggest combat sports spectacle of all time. To celebrate this historic sporting event, T3 Live’s Ifan Wei, a former collegiate boxer, will teach you a simple boxing lesson that directly applies to trading. Continue Reading ==> 7) Traders are no longer impressed by the biggest driver of stock market gains (Business Insider) The stock market is becoming a victim of its own success. Even when companies turn in impressive earnings reports, that strength isn’t translating to higher stock prices. Continue Reading ==> 8) Nation’s largest oil refinery forced to shut down as Harvey floods Port Arthur (CNBC) The largest oil refinery in the country is shutting down as Hurricane Harvey causes more catastrophic flooding.Early Wednesday, Motiva said it started closing its Port Arthur refinery “in response to increasing local flood conditions.” The plant won’t open until flood waters recede. Continue Reading ==> 9) What Floyd Mayweather Can Teach You About Negotiation (Inc.) Whether you have engaged personally in the sport of boxing or are just a fan of watching, there is much to be learned from the boxer mindset and performance that you can apply to your own life. Here’s how to dominate in a business negotiation in the same manner as Mayweather did this last weekend. Continue Reading ==> 10) The Cajun Navy to the Rescue! (YouTube) There’s not much to say. In an era of unprecedented divide, the Cajun Navy shows America at its absolute best:
Continue Reading -->Sentiment Update: From Depressed to Indifferent
Last Friday, traders became very bearish due to a combination of domestic and international strife, indicating that the market may finally be reacting to political volatility. Markets then powered up off the lows on Monday before a power rally on Tuesday. We’ve drifted sideways since then, so let’s take a fresh look at our 4 sentiment measures to see which way the crowd is leaning heading into this weekend. (click here for a primer on the sentiment indicators below) 1) VIX Spread – Bullish Two weeks ago, the VIX hit 17.28, but with markets steadying themselves, it’s back under 12. The 3-month spread is at +2.65, which means traders are moderately bullish. We’ve seen many readings above 4 this year, which is what I regard serious bullishness. (click here for a primer on the VIX spread) 2) CNN Fear & Greed Index – Bearish The Fear & Greed Index is at 22. The F&G Index operates on a 1-100 scale, and a reading of 22 qualifies as extremely fearful. This is just slightly up from 19 last week, and is one of the lowest readings we’ve seen this year. 3) AAII Sentiment – Bearish The latest AAII Sentiment Survey shows that 28.1% of individual investors are bullish, down from 34.2% last week. This 28.1% reading indicates that individual investors are moderately bearish, and it’s the lowest reading since June 1. 4) CBOE Equity Put-Call – Bullish The CBOE Equity-Put Call ratio was at 0.69 Thursday, which is justl above the long-term average of 0.655. The 3-day moving average is 0.61, which is below the long-term average and thus bullish. These numbers indicate that traders are moderately bullish Conclusion Out of 4 sentiment indicators, we have: 2 bullish (up from 0 last week) 0 neutral (down from 1 last week) 2 bearish (down from 3 last week) We have 2 bullish indicators and 2 bearish indicators, so they cancel each other out. So we’ve gone from very, very negative sentiment last week to pretty much neutral sentiment this week. Unfortunately, that means we don’t have much to go on heading into the weekend. When sentiment is leaning hard one way or the other, that can give us possible opportunities for countertrend trades, but we are definitely not there today. I like to say the bulls always say there are too many bears, and that bears always say there are too many bulls. But today everyone’s wrong: we’re split down the middle
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