Yesterday's Gone
Well that didn’t take long! After yesterday’s sharp move lower, investors were wondering if the market had enough wherewithal to make up the lost ground before the Fourth of July holiday. It did…and then some. The Dow and the S&P both wiped out Tuesday’s plunge, while the NASDAQ nearly did the same. A strong day for financials and a rebound in tech led the way.
“Yesterday’s downmove (aside from some profit taking and position squaring ahead of the long 4th of July weekend) made no sense. And today’s upmove appears to have corrected that,” said Kevin in Options Trader .
The S&P had its biggest single-day gain this month with an advance of 0.88% to 2440.7 and the Dow increased 0.68% to 21,454.6, which more than made up for yesterday’s losses of 0.81% and 0.46%, respectively. The NASDAQ jumped by 1.43% to 6234.4, nearly getting back all of the 1.6% that was lost on Tuesday. Perhaps Steve said it best in today’s Reitmeister Trading Alert: “Typically, a market that doesn’t want to go down will sooner or later find a way to go higher.” Fortunately, it was “sooner” in this case.
In the portfolios, Options Trader is taking this week by storm with three more moves on Wednesday. It had already cashed in four 100% returns on Monday and Tuesday. Meanwhile, RTA had a double-digit winner after selling part of the USCR position. The highlights section below has more:
Today’s Portfolio Highlights:
Reitmeister Trading Alert: Just as Steve expected, shares of US Concrete (USCR) have been pushing higher since the portfolio bought it back in mid-May. However, the editor has a feeling that $80 will be a level of extended resistance. He decided that today was a good time to sell part of the position and take a profit of 15.7%. The portfolio is still hanging onto a 6.5% allocation in hopes that another strong earnings report will boost shares even higher.
Options Trader: The portfolio has been extremely busy this week with four 100% winners in the first two days. It kept the action going on Wednesday with three new signals:
• Total System Services (TSS) is taking its sweet time in fulfilling Kevin’s expectations, so the editor wants more time. With only 51 days left, he sold to close the 2 Aug. 60.00 Calls and then exchanged them for 2 bull call spreads by buying to open 2 Nov 60.00 Calls AND selling to open 2 Nov 65.00 Calls.
• Kevin wanted to add a big financial institution to OT , and it just so happens that financial services giant Citigroup (C) has recently followed through to the upside after a bullish chart pattern breakout. Therefore, the portfolio added 2 bull call spreads by buying to open 2 Dec 65.00 Calls AND selling to open 2 Dec 70 Calls.
• Finally, the editor decided to get back into CME Group (CME) with a bull call spread, which included buying to open a Dec 125.00 Call AND selling to open a Dec 135.00 Call. The portfolio had great success with this name before, and Kevin thinks it’s time to get back in.
Read the complete commentary for more specifics on all these moves.
Insider Trader: “It was a rebound day on Wall Street as bottom feeders came in to buy their favorite tech and growth names.
“Was y esterday’s fall below the 50-day moving average on the NASDAQ a fluke?
“It’s still too early to tell.
“But there’s little fear in the market as investors gobbled up small caps and even the micro caps. That’s bullish.
“Could this be a goldilocks economy even without tax cuts or infrastructure spending? Stock investors are acting like it is.
“We’ll take it.” — Tracey Ryniec
Have a Good Evening,
Jim Giaquinto
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