The tough slog out of the doldrums continues for the US economy. Yesterday we had more confirmation that the service sector was heading in the right direction with the Institute of Supply Management’s non-manufacturing index, and a better-than-expected reading on pending home sales buoyed hopes for the consumer sector. Read More
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Qualcomm (QCOM) continues to march in the right direction. We mentioned management’s positive guidance, now analysts are speculating on the positives for the company of Apple offering CDMA (Qualcomm’s technology) iPhone for the Verizon network. Look for analysts to continue to nudge their forecasts for Qualcomm higher and for the… Read More
The momentum has yet to run out of stocks and 1220 on the S&P (another 4 percent higher or thereabouts) is still a very real possibility in the short term. Perhaps the best thing we can say about this market is the strong relative strength in small cap shares, which suggests a steep decline in the overall stock market isn’t in the cards just yet. Read More
As for our open trades, Qualcomm (QCOM) sprung to life last week after the company raised its guidance for the second quarter. The stock has yet to fill the huge gap in it price chart, but it’s certainly looks to be within reach. Stick with your position in the Qualcomm April 39 call option (AAO1017D39). Another tech stock headed in the right direction in Micron Technology (MU). The company will report its quarterly results tomorrow and while the shares have made a nice move lately increasing the risk of holding here, we think the prospects for an upside surprise remain. Our near-term target for the stock is its previous highs—another 6 percent or so above the current price. The Micron Technology July 10 call option (MU1017G10) is a hold. Last week we spoke of the divergence between Transocean (RIG) and crude oil prices. Since then we’ve watched the stock return to a more normal pattern. A continuation of this trend will carry the stock to the low to mid $90s, although we don’t expect it to get there in one fell swoop. The Transocean August 75 call option (RIG1021H75) is still a buy for new clients. Since it is well in the money, we view this option as a relatively low-risk trade. Read More
Stocks have moved to new highs since our last update. And while we saw some profit taking last Friday, buyers returned yesterday to bid shares higher. From a purely technical view of the market, a move up on the S&P to around 1220 (another 5 percent or so) certainly looks reasonable. Nevertheless, we remain a bit concerned about the health of the rally. Read More
In the meantime, if the stock market’s rally does continue technology shares are likely to be among the big winners. Micron Technology (MU) is certainly acting well. It has a modest bit of overhead resistance just above the current price, but once through that it should trade up to its previous high in short order. The Micron Technology July 10 call option (MU1017G10) as a play on expanding demand for memory chips. Buy it now if you haven’t already; set a limit order to pay no more than $1.35 per contract. We’ve seen a fairly substantial divergence between the performance of Transocean (RIG) and crude oil prices in the past month. Historically, the stock tracks fairly closely with crude. Assuming oil prices merely hold steady, return to historic norms, which we still expect to occur, will carry Transocean to the low $90s. The Transocean August 75 call option (RIGN21H75) is still a buy for new clients. Since it’s well in the money, the option is as a relatively low-risk trade. Qualcomm (QCOM) continues to mount a recovery and with the massive gap in its price chart the stock likely has a long way to climb. Maintain your position in the Qualcomm April 39 call option (AAO1017D39). Read More
Canada, rare among nations, has managed its resource extremely well, to the benefit of all Canadians. A new set of choices await the current crop of political leaders charged with managing these assets. Read More
Stocks have traded in a fairly tight range in recent sessions, but it has been fascinating to watch. The market stands at a critical juncture and it looks like the bulls will prevail, but it’s still too early to call. Last week we pointed out that we wanted to see… Read More
This morning we added the Micron Technology July 10 call option (MU1017G10) as a play on expanding demand for memory chips. Buy it now if you haven’t already; set a limit order to pay no more than $1.35 per contract. Shares of Transocean (RIG) are little changed from where they… Read More
Buy to open the Micron Technology July 10 call option (MU1017G10). Set a limit to pay no more than $1.35 per contract. Micron Technology (MU) is a leading technology company and the leader in the memory space. Its memory chips are used in PCs, handsets, cameras, and other consumer and… Read More