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 stock market in the first year since President Trump’s 2016 election victoryThe post-earnings collapse in fallen tech star Snap (SNAP)Whether the lucrative, exciting world of prop trading is right for youAnd more!So check out these links right now and get up to speed:1) A year in: U.S. stock market under Trump’s shadow (Reuters) One year ago, when it became clear that Republican Donald Trump had pulled a historic upset to defeat Democrat Hillary Clinton to the U.S. presidency, futures in the Dow Jones Industrial Average tumbled nearly 900 points.Read the Story ==>2) Snap plunges after huge revenue miss (CNBC) Snap dropped 16 percent after it missed on revenue during its third quarter earnings Tuesday. Snap also wrote down $39.9 million as a result of losses from unsold SpectaclesRead the Story ==>3) The Ultimate Guide to Prop vs. Retail Trading (T3 Live) If you want to be an active trader in individual stocks, you really only have two general paths: Become a professional trader (prop trader) or trade in a retail account. Let’s look at the advantages and disadvantages of both so you can figure out the right path for you.Continued Reading ==>4) America’s ‘Retail Apocalypse’ Is Really Just Beginning (Bloomberg) The so-called retail apocalypse has become so ingrained in the U.S. that it now has the distinction of its own Wikipedia entry. The industry’s response to that kind of doomsday description has included blaming the media for hyping the troubles of a few well-known chains as proof of a systemic meltdown.Continued Reading ==>5) How Implied Volatility Works (T3 Live) We’re going to dig into the single most important options pricing concept: implied volatility. If you don’t understand implied volatility, you don’t understand options. Period!Continued Reading ==>6) Ralph Northam wins Virginia’s governor race (The Economist)Observers braced for a late night. Virginia’s polls close at 7pm, and precincts in the diverse, densely populated suburbs of Washington, DC usually take a long time to come in.Continue Reading ==>7) Trading Scans: The Foundation for Winning Trades (T3 Live) Take a look at our latest trading scans, which can help you find potential capitulations and explosions out of consolidations. Get our exact metrics and replicate them yourself.Continue Reading ==>8) Broadcom takes page from Drexel playbook with Qualcomm offer (Pittsburgh Post-Gazette) Broadcom is using a tactic popularized by corporate raiders in the 1980s to convince Qualcomm and its shareholders that it has the means to complete the biggest tech deal ever.Continue Reading ==>9) Deloitte Report: Over 26,000 Blockchain Projects Began in 2016 (CoinDesk) More than 26,000 new projects related to blockchain were created on code repository GitHub last year, according to data collected by Deloitte. For its new report – titled “Evolution of Blockchain Technology: Insights from the GitHub Platform” and published today – the professional services firm drew information from the development platform, which plays home to the code for over 86,000 blockchain initiatives, including major projects like bitcoin.Continue Reading ==> 10) Denzel Washington on the Power of Falling Forward (NY Times) In 2011, Academy Award-winning actor Denzel Washington explained why you need to embrace failure to be ready for success.
Continue Reading -->Trading Scans | The Foundation for Winning Trades
Additional scans below the video.A quick note about the scans. Have some fun combining them to find even greater opportunities such as a bullish momentum trade combined with double normal volume = a potential capitulation signaling the end of recent momentum (and a place to book profits) or an explosion out of a consolidation (that leads to an all-new trend!) Scan Criteria: Bullish Trends: Performance “month Up” + 20 day simple moving average “price above SMA 20” + price “over $20” + 50 day simple moving average “price above SMA 50” + 200 day simple moving average “price above SMA 200” + Industry “stocks only” + Average true range “over 1.5″ + Average volume ” Over 2 million” Bearish Stocks: Performance “month down” + 20 day simple moving average “price below SMA 20” + price “over $20” + 50 day simple moving average “price below SMA 50” + 200 day simple moving average “price below SMA 200” + Industry “stocks only” + Average true range “over 1.5″ + Average volume ” Over 2 million” Double Normal Volume: Price “over $10” + Average True Range “over 1.5″ + Average volume ” over 2M” + Relative volume “over 2” + Industry “stocks” Short-term bullish momentum: Performance ” Month up” + Price “over $10″ + Performance 2 ” Week up” + Average true range “over 1.5” + Average volume “Over 2M” + Industry “stocks” + Change from open ” up 2%” Short-term bearish momentum: Performance ” Month down” + Price “over $10″ + Performance 2 ” Week down” + Average true range “over 1.5” + Average volume “Over 2M” + Industry “stocks” + Change from open ” down 2%”
Continue Reading -->T3’s Market Wrap: How Do You Like Dem Apples?
Traders had two questions heading into Apple’s (AAPL) Q4 earnings report yesterday after the close: 1) Can the company produce enough iPhone X units? 2) Can the company sell enough iPhone 8 units? Apple answered both questions with an emphatic yes, proving once again that the Apple supply chain rumor mill can’t be trusted. The media does a great job of sniffing out Apple product announcements, but they’re awful at figuring out just how much product the company is selling. We’ve been hearing a lot of rumors about weak iPhone demand, and we know now that they had zero basis in reality… not that the bears would admit that. Apple reported EPS of $2.07, smashing the $1.87 consensus. Revenue was $52.6 billion, easily beating Wall Street’s $50.7 billion forecast. iPhone units were also above expectations, as was Q1 revenue guidance. Apple shares hit an all-time high at $174.26 this morning before some minor profit-taking hit. We still have to see what happens with Nvidia’s (NVDA) earnings report on Thursday, but make no mistake: tech earnings season has been nothing short of fantastic. The October nonfarm payrolls report was released on Friday, revealing that the economy added 261,000 jobs in October, missing the 310,000 Wall Street consensus. The unemployment rate was 4.1%, besting the 4.2% expected. However, the big story was Average Hourly earnings, which were unchanged. Economists expected growth of 0.2%. The numbers point to a strong labor market that isn’t generating much wage inflation. Workers are in demand, but pay just isn’t going up. The lack of wage growth means the Fed could continue to undershoot its inflation goals. The US dollar and Treasury yields fell after the numbers hit, but reversed afterwards. Gold shot up but dipped back into the red. This morning, T3 Live Chief Strategic Officer Scott Redler said that “yesterday, SPX broke below 2567 momentarily, and we now have the 2566 low as our new point of reference. As long as that holds, not much changes. We didn’t come close to that 2566 low, implying that the bull move remains fully intact. The relentless bid that keeps stock pumped in the face of a chaotic news flow is proving endlessly frustrating to the bears. Every time there’s a sign of trouble — like the recent weakness in the Russell 2000 — it quickly gets reversed and we see new headlines celebrating all-time highs. Now it seems like the only element left is time. The market’s been zooming higher and higher ever since the Presidential election. The longer time goes on, the greater probability of an unexpected shock. But betting against the likelihood of a shock has been the best trade in the market. The VIX can barely stay above 10, there’s almost no intraday movement, let alone run-of-the-mill 5% to 10% drawdowns that used to be fairly common place. So unless we get some actual technical deterioration in the charts, the only thing the bears can hope for is a shock that comes out of nowhere and destroys faith in the system. Sooner or later, something bad will happen. It always does. But good luck predicting when…
Continue Reading -->The News Is Flowing. Are Traders Happy?
We’ve got a lot of news flowing. Apple (AAPL) hit new all-time highs after delivering an incredible fourth-quarter earnings report. President Trump announced the nomination of Jerome Powell as Fed Chairman. The October nonfarm payrolls report disappointing. On a random note… has anyone heard from North Korea lately? Anyway, with stocks still hovering around all-time highs, let’s take a look at our sentiment indicators to figure out what kind of mood the crowd is in. (click here for a primer on the sentiment indicators below) 1) VIX Spread – Bullish Last week, the VIX broke its shocking streak of 25 days in a row with an intraday low under 10, and it even went over 13. But as of Friday morning, it’s back down to sub-10 levels around 9.73. This gives us a 3-month spread of about +4.20, which means traders are very bullish. (click here for a primer on the VIX spread) 2) CNN Fear & Greed Index – Bullish The Fear & Greed Index is at 69, which marks modest greediness on the part of investors. It hit multi-year highs at 95 4 weeks ago. 3) AAII Sentiment – Bullish The latest AAII Sentiment Survey shows that 45.1 of individual investors are bullish, up substantially from 39.6% last week. This is above the long-term average of 38.5%, so it shows bullishness. In fact, it’s the highest reading since January 5, 2017. AAII sentiment has been depressed throughout 2017 despite the market hitting a nonstop streak of all-time highs. This seems like a big change. 4) CBOE Equity Put-Call – Bullish The CBOE Equity-Put Call ratio was at 0.63 on Thursday, below the 0.655 long-term average. The 10-day moving average is 0.635, which is slightly above the long-term average, indicating higher-than-normal demand for put options. I would call this very slightly bullish. So it looks like options traders were pretty optimistic heading into Apple’s Thursday afternoon earnings report and Friday’s nonfarm payrolls numbers. Conclusion Out of 4 sentiment indicators, we have: 4 bullish (up from 2 last week) 0 neutral (down from 1 last week) 0 bearish (down from 1 last week) Make no mistake, the crowd is clearly more bullish than last week. I’d guess that’s for two reasons: 1) Tech earnings season has been remarkably strong 2) The market just won’t go down Now, that may have the bears thinking we’re in danger of overheating. But keep in mind, no individual sentiment indicator is flashing extreme, full-on nutty bullishness. The crowd is positive, but it’s not irrational. If we continue to make new highs, I wonder if that AAII sentiment number will spiral even higher as individual investors turn into true believers. You may be asking yourself “how can the market get to all-time highs without a large crowd of true believers?” My answer is simple: I think an awful lot of buyers hold their noses while putting their money to work. They put money to work, but don’t necessarily feel great doing so. In fact, I keep coming back to a Gallup Poll from earlier in the year. It found that just 54% of US adults have participated in the 2009 – 2017 bull market. From 2001 – 2008, 62% of adults owned stocks. So we have to balance out bullish sentiment with the fact that many people just got up and left the table altogether. Good luck reconciling those two points…
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:President Trump’s choice to replace Janet Yellen as Fed ChairThe Fed’s rate decision, and what to look for in DecemberHow Sami Abusaad scored over $12K in a single tradeAnd more!So check out these links right now and get up to speed:1) Trump to Tap Fed’s Jerome Powell for Fed Chairman (Wall Street Journal) The White House has notified Federal Reserve governor Jerome Powell that President Donald Trump intends to nominate him as the next chairman of the central bank, according to a person familiar with the matter.Read the Story ==>2) Fed holds off on rate hike, opens door to December (CNBC) The Federal Reserve declined to raise interest rates at its policy meeting this week and said the late-summer hurricanes likely will not have much longer-term impact on overall economic activity. There was little in the post-meeting statement Wednesday to indicate that the Fed would hold off on raising rates again soon.Read the Story ==>3) Sami Abusaad: $12K+ in 1 Profit in 1 Day with Nautilus (T3 Live) In this special video, Nightly Game Plan Moderator Sami Abusaad takes you through an Earnings Play in fitness equipment company Nautilus (NLS). On Monday, October 30, Sami went short Nautilus at $16.35, just ahead of earnings. Sami got out Tuesday morning at $13.00 for a $3.35 per share profit. Continued Reading ==>4) Facebook Tops Sales Projections While Russia Ad Inquiry Unfolds (Bloomberg)Facebook Inc. reported another quarter of record sales, underscoring how far removed the social network’s business prospects are from the raging public debate about Russian political ads on its platform.Continued Reading ==>5) What’s the Economic Cost of Brexit? (Pineapples Tell a Tale) Britain is increasingly grappling with the bewildering economic consequences of its pending departure from the European Union. For one company, Nim’s Fruit Crisps, the impact is measured in the soaring cost of pineapple.Continued Reading ==>6) Catalonia: Puigdemont ‘will not return’ to Spain for questioning (BBC)Sacked Catalan leader Carles Puigdemont will not return to Spain to answer charges including rebellion, his Belgian lawyer has said. Speaking to the Associated Press, Paul Bekaert suggested Mr Puigdemont should instead be questioned in Belgium where he has been since Monday.Continue Reading ==>7) Options in Play: An Event-Driven CELG Trade (T3 Live) Earnings season is packed with opportunity if you know where to look. CELG came into the quarter reeling from a 1-2 punch of a downgrade and drug trial setback. There was reason to believe the stock still had room to move (either way), however, so we thought it set up well for a strangle into numbers.Continue Reading ==>8) Luxury auto brands are scrambling to avoid a blue Christmas (NPR) When financial markets surge to new records, sales of luxury cars usually rise, too. Instead, October U.S. auto sales reports on Wednesday showed that a collapse in sales of luxury sedans is accelerating.Continue Reading ==>9) The Dangerous Reason Why Bitcoin Just Hit Yet Another New High (Fortune)Bitcoin just keeps on rising in value. Just more than a week after breaking $6,000 for the first time, the Bitcoin price reached another new high of $6,300 a few days ago, and is now on track to set a new all-time record for the fourth day in a row. Continue Reading ==> 10) Hilde Lysiak, Reporter, Author, 10-Year Old (NY Times) The first book in the “Hilde Cracks the Case” series opens with 9-year-old Hilde Lysiak outside her local police station in the town of Selinsgrove, Pa., following up on a tip about a break-in on Orange Street. The on-duty officer refuses to divulge any information, but if she’s going to break the story in her newspaper, The Orange Street News, she has to investigate using six basic reporting questions: Who? What? Where? When? Why? How? Continue Reading ==>
Continue Reading -->Sami Abusaad: $12K+ in Profit in 1 Day with Nautilus
In this special video, Nightly Game Plan Moderator Sami Abusaad takes you through an Earnings Play in fitness equipment company Nautilus (NLS). On Monday, October 30, Sami went short Nautilus at $16.35, just ahead of earnings. Sami got out Wednesday morning at $13.00 for a $3.35 per share profit. In total, Sami earned $12,115.50 in this one-day trade! (watch the video to see Sami’s actual account statement) (click here to join the Nightly Game Plan and join Sami in these incredible trades!) Watch this video and learn about: Sami’s $34,000+ in profits for October How Sami measures expectations to figure out whether to go long or short The anatomy of Sami’s $12K+ in one day Nautilus play, including the entry, exit, and management plan The idea behind the unique Earnings Play Strategy, which is part of the Nightly Game Plan swing trading manual 24 successful earnings plays including Community Health Systems (CYH), Thermo Fisher Scientific (TMO), and eBay (EBAY) 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 -->T3’s Top 10: Our Most Popular Articles for October 2017
What’s popular with the thousands of traders that make up the T3 Live community? You’re about to find out with our top 10 articles for October 2017, ranked by visits to our website. We’ve got a special sneak preview of Redler Ultimate Access, 3 options education articles, tips for picking stocks to day trade, and more! We’ll start with number 10 and work our way down to number 1: 10) Scott Redler’s Morning Call Video: Ultimate Access Edition To celebrate the first-ever Redler Ultimate Access weekend of trading and education, T3 Live is publishing today’s Morning Call video as a bonus for our readers. 9) Theta: The Options Trader’s Kryponite Welcome back to our Introduction to Options series! By now we’ve covered The ABC’s of Puts and Call and How Implied Volatility Works. Now, we’re going to explore another critical factor in options pricing: time 8) How to Start Trading Options: The ABC’s of Puts and Calls Are you ready to start trading options?’ Then you’re in luck. You’re about to get a 100% FREE crash course in options trading, comprised of 5 in-depth articles. 7) Scott Redler: How I Traded AMZN Before and After Earnings In this special excerpt from Redler All-Access, T3 Live Chief Strategic Officer Scott Redler broke down how he traded Amazon (AMZN) before and after its huge third-quarter earnings report. 6) 5 Ways to Know If Your Day Trade Should Last All Day Have you heard the “let your winners run?” How about “take what the market gives you” or “never let a winner turn into a loser?” While these idioms can seem like direct contradictions, they are all truths in trading that each apply to certain contexts. 5) How Implied Volatility Works In our introduction to options trading, we discussed some basics of options, like the differences between calls and puts, how options contracts work, and why options is a zero sum game. Now we’re going to dig into the single most important options pricing concept: implied volatility. 4) Deadly Waves Spotted 30 Years After Black Monday Because of the two dramatic downturns this century, investors have gone passive thinking this protects them when in reality, it probably will lead to greater risk when the virtuous circle of ETF buying revolves in the other direction. Once a parabolic arc breaks and sentiment is pierced, there is no telling how low the low can be. 3) Sami Abusaad: 32 Stocks I’m Watching for Earnings Season In this special video, Nightly Game Plan Moderator Sami Abusaad walks you through his earnings season swing trading watchlist. With volatility so low, not many trades triggered this week, so Sami’s going to take you through the 32 stocks Sami is watching for potential opportunities this earnings season: 2) 6 Tips for Picking the Right Stocks for Day Trading If you ever find yourself asking yourself “what should I trade now,” then this article is for you. We’ve put together a list of 6 simple, effective tips for picking the right stocks for day trading. 1) 9 Tips for Picking the Right Stocks for Swing Trading As a swing trader, one of the most important decisions you’ll every make is choosing which stocks to trade. You can learn all the winning setups in the world, but if you trade the wrong stocks, you’re going to lose money.
Continue Reading -->Is the Bull Train Full? Nope!
On Friday, the Nasdaq made new all-time highs on strong earnings from megacap tech giants Amazon.com (AMZN), Intel (INTC), Alphabet (GOOGL), and Microsoft (MSFT). This spike came on the heels of what looked like the beginnings of a downtrend. On Wednesday, October 25, the SPX index made a lower low and we saw the biggest intraday range since early September. So let’s take a fresh look at our sentiment indicators to see how the crowd is feeling ahead of the weekend. (click here for a primer on the sentiment indicators below) 1) VIX Spread – Bullish On Tuesday, October 24, the VIX broke its shocking streak of 25 days in a row with an intraday low under 10, and went over 13 on Wednesday for the first time since September 5. As of Friday morning, the VIX is hovering around 10.20 This gives us a 3-month spread of about +4.00, which means traders are very bullish. (click here for a primer on the VIX spread) 2) CNN Fear & Greed Index – Bullish The Fear & Greed Index is at 70, which marks modest greedness on thepart of investors. It hit multi-year highs at 95 just 3 weeks ago. 3) AAII Sentiment – Neutral The latest AAII Sentiment Survey shows that 39.6% of individual investors are bullish, up slightly from 37.9% last week. This is in-line with the long-term average of 38.5%, so it’s basically neutral. 4) CBOE Equity Put-Call – Bearish The CBOE Equity-Put Call ratio was at 0.61 on Thursday, below the 0.655 long-term average as traders aggressively bought call options ahead of a big night of earnings. Those buyers certainly woke up happy on Friday! The 10-day moving average is 0.664, which is slightly above the long-term average, indicating higher-than-normal demand for put options. I would call this very slightly bearish. Conclusion Out of 4 sentiment indicators, we have: 2 bullish (flat from last week) 1 neutral (flat) 1 bearish (flat) Overall, sentiment is basically relative to last week. The mood is still moderately bullish as traders think about what’s next. Just a few weeks ago, traders seemed downright insanely bullish, though they calmed down a bit even as the indices stretched to new highs. I think we’re in a decent spot. The mood is positive, but there’s still room for folks to hop on the bull train. In particular, options traders seem like they have room to get more bullish. Thursday saw heavy demand for call options, particularly in tech names like AMZN and MSFT. But the CBOE equity put-call indicates that overall, traders have been favoring put options, possibly because they were afraid of another whoosh down from the lower low on October 25. Now the big question is whether the strength in tech will push the bulls back into bullish insanity. Earnings season as a whole hasn’t been all that great, so investors may allocate more money towards tech because that’s where the numbers have been best. The next big reports to watch are Apple (AAPL) on Thursday, November 2 and Nvidia (NVDA) on November 9. If they both beat big, maybe the bulls just keep on buying.
Continue Reading -->Sami Abusaad: Breaking Down a $5,774.21 Trading Day
In this special video, Nightly Game Plan Moderator Sami Abusaad takes you through his swing trading watchlist, and how he’s successfully trading through earnings season. You’ll get his take on the broader markets, how he’s playing the names on his earnings watchlist, and 4 fresh opportunities he’s playing now: Watch the video and learn about: How Sami made $5,774.21 on earnings plays and options trades in one day Why he is closely watching QQQ’s 20 day moving average A possible breakout failure on QQQ’s monthly chart Grubhub’s (GRUB) weekly buy setup The Weekly Sell Setup in New York Community Bankcorp (NYCB) The picture-perfect breakdown in Arlington Asset (AI) How you can take earnings plays alongside Sami 4 earnings plays Sami may be about to take 2 day trades Sami took in the Black Room 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:Can Apple Overcome iPhone 8 Rumors?Amazon Putting Packages In Your Home When You’re Not ThereHow Changing the World Starts With Making Your BedAnd more!So check out these links right now and get up to speed:1) Scott Redler: Can Apple Overcome iPhone 8 Rumors? (T3 Live) There is lots of talk about soft demand for Apple’s (AAPL) iPhone 8. There are also rumors that they will run short on iPhone X supplies. So let’s focus on the technicals.Read the Story ==>2) Amazon Can Soon Put Packages in Your Home When You’re Not There – Here’s How it Works (Business Insider) Amazon will now allow deliveries inside your home when no one’s there. It’s part of the new Amazon Key program announced on Wednesday. To participate, customers need to be Amazon Prime members and own some special equipment, including a compatible smart lock and a security camera specially made for the program.Read the Story ==>3) Jeff Cooper: The End of the Volatility Fire Sale (T3 Live) The SPX went flat Tuesday, unable to rally back to prior day’s highs. It appears there is a lot of shorting just as big mutual funds try to keep this leviathan levitating into their October 31 fiscal year-end.Continued Reading ==>4) How A Two-Person Montana Company Ended Up With The Biggest Energy Contract In Puerto Rico (BuzzFeed News)Ten miles south of Whitefish, Montana, a paved road turns into gravel, before turning into forest. On one side, there’s a small horse farm. On the other, signs read “Private Property” and suggest the area is being patrolled in order to prevent poaching. At the end of a long private drive lined with towering pines, an RV is parked on the grass in front of a log and stone cabin.Continued Reading ==>5) US New Home Sales Soar to Highest Level in a Decade (U.S. News) Sales of new U.S. homes jumped last month to the highest level since October 2007, a sign that Americans — unable to find existing homes — are turning to new construction. Damage from last month’s hurricanes may have also inflated the data.Continued Reading ==>6) Google and Cisco Have Teamed Up in the Cloud Wars Against Amazon and Microsoft (Business Insider) Google Cloud has signed a partnership with Cisco to bridge their two technological worlds, in a bid to catch up with Amazon Web Services and its domination of the fast-growing cloud computing market.Continue Reading ==>7) 32 Stocks I’m Watching for Earnings Season (T3 Live)In this special video, Nightly Game Plan Moderator Sami Abusaad walks you through his earnings season swing trading watchlist. With volatility so low, not many trades triggered this week, so Sami’s going to take you through the 32 stocks Sami is watching for potential opportunities this earnings season:Continue Reading ==>8) Honolulu’s ‘Distracted Walking’ Law Takes Effect, Targeting Phone Users (NPR) Police in Honolulu on Wednesday will begin writing tickets for people who get distracted by their cellphones while walking in a crosswalk. Honolulu is the first major city in the country to pass such a law, citing a high rate of pedestrians being hit in crosswalks.Continue Reading ==>9) Will Facebook Kill All Future Facebooks? (Wired)In 2010, FOURSQUARE co-founder Naveen Selvadurai believed that his company, and several other social-media upstarts—Twitter, Tumblr, Path—could carve out successful niches against Facebook.Continue Reading ==> 10) One of the Most Motivational Speeches You’ll Ever Hear (YouTube) Watch this video and learn how the simple task of making your bed can set you up for success.
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