Weekly Update: April 9, 2015

| April 9, 2015

Weekly Update:  April 9, 2015


What To Watch

It’s been a fairly quiet week overall, with a moderately positive bias in equities.  The S&P 500 is up about a percent from this time last week.  For the year, the index is closing in on 2% gains.  Meanwhile, volatility has been mostly nonexistent.

Investors still appear to be in wait and see mode.  Granted, there wasn’t a whole lot of market-moving news this week.  Still, it appears the crowd is waiting for something bigger to come along before investors make a directional decision.

There are a few economic reports coming out next week which could be meaningful, including CPI, PPI, and new residential construction.  The price indices are important as they’re some of our most important measures of inflation.

In the meantime, earnings season has officially kicked off.  Most of the big earnings releases will start next week.  Some of the biggest reports do have the potential to move the markets, at least in the short-term.  Of course, earnings seasons can also be a great time for us to find some excellent trading opportunities.

Stay tuned for a new trade next week.


Portfolio Recap

Position #1: Take Two Interactive Software (TTWO) April 25 Calls

Price Paid: $1.15

Current Price: $0.40

Time Until Expiration: 8 days

TTWO continued its sideways move this past week, which isn’t what we needed.  With expiration coming up in a week, we’re getting hurt by time value.  Our options are still right at the money, so any decent move up will give us a chance to profit on the trade.


Position #2: Prudential Financial (PRU) April 82.50 Calls

Price Paid: $1.77

Current Price: $0.56

Time Until Expiration: 8 days

PRU did manage to break out of its sideways range with a 1% move higher today.  We’ll need a few more of those over the next week to turn this trade profitable.  Still, all it takes is one sharp up day to give our calls a chance at profitability.


Position #3: Blackberry (BBRY) May 10 Calls

Price Paid: $0.70

Current Price: $0.32

Time Until Expiration: 36 days

BBRY is back up above $9.50 and had recovered most of the ground lost after the negative analyst note.  With this position having a May expiration, there’s still more than enough time for BBRY to break above our strike.  Let’s see what the next couple weeks bring.


Position #4: Cree (CREE) May 37.50 Calls

Price Paid: $1.47

Current Price: $1.40

Time Until Expiration: 36 days

CREE is right back where it started when we bought it.  And, our options are also basically flat.  In other words, not much to report yet.


Position #5: GoPro (GPRO) May 48 Calls

Price Paid: $1.55

Current Price: $1.60

Time Until Expiration: 36 days

We bought GPRO calls yesterday, so as you can imagine, not much has happened.  The big thing to watch with this position is if the stock can make a sustained move above the 50-day moving average.


Category: OTW Weekly Updates