Just 4 days to re-make all the gains the Dow had in the entire month of September. We're only 800 points away from the all-time high- we could get there by lunch at this pace. The sell-off took the entire month of November, with 6.7Bn shares traded on the way down but it only took 1Bn trades to reverse all those losses. Consider how much LESS money is now supporting that price indicator on the Dow – it's a real house of cards we're building here.
The good news is that, after a whole week of evidence, the Governments and media outlets that desperately want us to be open for Christmas have declared Omicron to be "not so bad." We all want that to be true so hopefully it is but it's way too early to make that call – irresponsible, in fact. Remember in March of 2020 Trump was stil claiming Covid wasn't a problem. In May of 2020 (Memorial Day weekend), most of America declared the emergency over. How can we possibly know now whether or not Omicron is a problem or not?
We hope not and we're certainly happy we were buying this dip as last week's Trade of the Year Runner Up, Intel (INTC) is blasting higher this morning, up 7.5% pre-market as INTC announces plans to spin off Mobileye self-driving division. Last week's trade idea for INTC was:
Intel (INTC) was our Trade of the Year for 2021 and it did so well we cashed it out in April but now it's come back down and we'd like to add it back to our Money Talk Portfolio. They did not make the cut because 2022 is an investment year for them but, longer-term, we're very exited to own the stock under $50.
- Sell 10 INTC 2024 $45 puts for $7 ($7,000)
- Buy 20 INTC 2024 $45 calls for $11 ($22,000)
- Sell 20 INTC 2024 $55 calls for $7 ($14,000)
Here we are laying out net $1,000 in cash and promising to buy 1,000 shares of INTC for $45. If we lose all of the spread value and have to buy the stock, our net entry would be $46, which is still $3.20 (6.5%) below the current price. It's a little aggressive but I certainly don't fear owning 1,000 shares of Intel for the long haul. It's a $20,000 spread so the upside potential is $19,000 for a 1,900% return if all goes well and, as we're starting out over $9,000 in the money – it's already going well! INTC has to fall 10% before you lose money on the spread – that's a great way to start!
We had a very conservative target and we're going to be testing it this morning – not bad for a week's work, right? Congratulations to all who played along with us. Runner-Up WBA has also had a very nice week for us as has MO and our Trade of the Year Winner – IBM.
Since Thanksgiving, Philstockworld has issued the following Top Trade Alerts to our Members:
- Top Trades for Mon, 29 Nov 2021 11:42 – BNTX and DAL
- Top Trades for Tue, 30 Nov 2021 14:43 – IBM
- Top Trades for Wed, 01 Dec 2021 12:52 – VIAC, INTC, MO, WBA and IBM (again)
- Top Trades for Thu, 02 Dec 2021 11:54 – TD
- Top Trades for Thu, 02 Dec 2021 15:57 – CLF
That's 10 Top Trades in less than 10 days in ADDITION to the regular trade ideas we share in our Liver Member Chat Room every day. That's what we do when the market goes on sale – sorry it was so boring leading up to it but we were waiting for exactly this opportunity to re-deploy some of our cash and it didn't matter that there was a new virus strain because we EXPECTED that to happen – that's why we were playing cautiously in the first place!
I've always been very good at predicting what was going to happen – it's getting the timing right that I've had to work 40 years on…
Nostradamas gets a few things partially correct within plus or minus 50 years and peeople say he's amazing – try doing that with stock picks and see what people say about you! Timing is everything in the markets so we have to learn to be patient and we have to be ready to act or, as Pink Floyd told us:
"You got to be crazy, gotta have a real need
Got to sleep on your toes, and when you're on the street
Got to be able to pick out the easy meat with your eyes closed
Then moving in silently down wind and out of sight
You got to strike when the moment is right, without thinking" – Dogs
Now that the market has cycled back to the top, we're going to have to be more selective but we've already got $75,400 worth of profit potential from last Tuesday's 4 new picks. That's in addition to the $159,936 of potential profits that were already in our Money Talk Portfolio so yes, we also hope Omicron is mild and the beaches stay open but, on Friday – we also improved our hedges – just in case it isn't.
Be careful out there!