Last week started with a BANG for the Weekly Money Multiplier gang!
If this were Vegas, they’d ban me from the Casino.
I ate earnings like Microsoft for lunch.
How many times do you get to share with members success like this:
That’s a smorgasbord of wins across the entire market…stocks, ETFs, earnings…take your pick!
I hunted these trades for days – stalking them like a panther.
SPY – S&P 500 ETF
Traders look to the SPY as a gauge for the entire market. It represents a broader set of established companies than the Dow Jones Industrial Average. But, it’s not as tech-heavy as the NASDAQ.
And right now, it’s at a critical juncture.
The week closed near the highs for the SPY.
SPY daily chart
The actual all-time highs come in at $302.63. Friday came up short by about 20c.
This week the Federal Reserve delivers their rate decisions. Most people (and especially traders) expect a rate cut.
More often than not, the market likes to float higher into the Fed announcement. This presents a wonderful chance to work with SPY options.
One neat thing about the SPY options is they offer Monday, Wednesday, and Friday expirations. That gives you tons of flexibility in your choices and trade structure.
Don’t be surprised if the market pushes higher off the announcement well past the new highs. However, this could offer up a fantastic place to get short the market as well.
The market continues to ride higher on easy money and hope. With earnings down 4.7% year over year, does anyone really believe that justifies new highs?
DUK – Duke Energy
I took a position in Duke Energy earlier this week.
Utilities rose unabated the last several months. Skyrocketing bond prices drove down treasury yields. That forced conservative investors to seek yields in reliable dividend stocks.
TLT weekly chart
A few things stand out to me on the DUK chart.
DUK daily chart
First, other than a few days, the stock remained inside the large bullish candle from early October. That’s created a lot of sideways movement in a tightening price range.
Second, there’s a clear uptrend in the stock. Even with the recent price action, nothing says this stock is about to break down.
Third, price continues to ride the 30-period moving average. If the stock really wanted to move lower, it would have already made its move.
Lastly, the series of higher lows, along with lower highs creates a triangle formation. This chart pattern indicates the stock wants to move higher.
These setups fall within my TPS framework – trend, pattern, squeeze. With all of these elements, I have a clear plan. I know my stops, entries, and targets. Just as important, I see the range where I can scale-in.
However, I don’t want to hold this stock through earnings. The company reports on November 8th. Even if the pattern hasn’t played out, I’m going to be out of my trade by then.
ROKU – Roku
If I were stranded on a desert island and could only trade one stock…I’d pick ROKU. Honestly, I couldn’t tell you a ton about the actual company’s fundamentals.
What I can tell you is the stock works great as a trading vehicle. This stock performs extremely well with technical patterns and especially my trading style.
To give you an idea of how much I love this stock, I’ve traded it at least once every week in October.
Heck, I own the options going into this weekend.
What makes this stock so special?
Let’s look at the chart to start.
ROKU weekly chart
You immediately see the recent run in price. Moves like that aren’t sustainable. But, they create strong trading trends. But, you don’t want to risk being the last sucker at the top.
Options make the entire strategy work. I use them to limit my risk. If the stock crashed overnight, my total losses remain capped.
So, I look for signals the stock peaked. Otherwise, I play the trend.
No joke, this is a snapshot of my portfolio from the end of July. See a familiar face?
Recently, when the stock crashed out, it remained technically sound. Notice how it found support both at the 30-week moving average and the last breakout point.
I then broke it down to shorter time-frames to look for quick trades to play long. That let me hit some quick profits on call options.
Now I’m looking for its next move. The stock retraced but appears stalled out. I’m playing the uptrend for now. However, I’ll be happy to jump on the downside when I see the signs.
Don’t sit this market out
We have a ton of fun, and I love the chance to teach how you can beat the markets.