1. Market Summary
Board of Options Exchange Quantitative Easing Demonstrates a Very Short Half-Life
The day after the Wednesday BOE QE bounce fizzled, futures were lower, stocks opened lower and never threatened turning positive. Stocks sold early, they bounced, they sold into midafternoon, they bounced again into the close — each move showing a lower low and a lower high. The half-life of the BOE QE move proved fleeting.
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NOTE: The figures and information above are from the 9/29 report.
NOTE: The videos are from the 9/28 report.
2. Targets Hit
Ingersoll Rand Inc. (NYSE: IR): IR performed so well into August, but alas, even the good die some in a bear market. IR peaked a solid move in August, then faded on low volume to test the 50-day moving average (MA). All normal. It jumped up off the 50-day simple moving average (SMA) on strong volume. Very normal for a strong stock.
It rallied and moved back over the 200-day SMA with a gap. Solid. It then immediately gapped below the 200-day SMA. Uh oh. IR faded back to the 50-day SMA where it worked laterally, but struggled, slipping just below it. On Sept. 21, IR opened higher, reached up to tap the 50-day SMA, but then reversed. That was it.
We issued an alert for Investment House Daily subscribers to enter with November $45 put options trading on the ask at $2.04. IR finished that day at a new selloff low. The next three sessions, IR probed lower, landing at a gap point on Sept. 26.
That was our initial target, and IR held there that day with a doji. After a very nice drop from the 50-day MA to that support, IR was due a bounce. We issued the alert to sell with the options bidding for $3.20 and a nice 56% gain.
Technical Trader Alert had a busy week with lots of movement up and down. So, we banked some gains on the action.
Analog Devices, Inc. (NASDAQ: ADI): 16.18% gain in the put options.
Broadcom Inc. (NASDAQ: AVGO): 37% gain in the put options.
CH Robinson Worldwide Inc. (NASDAQ: CHRW): 36% gain in the put options.
Dave & Buster’s Entertainment Inc. (NASDAQ: PLAY): 59% in the put options
ProShares UltraShort Dow30 (NYSEARCA: DXD): 76% gain in the call options.
Lam Research Corporation (NASDAQ: LRCX): 116% gain in the put options.
Mastercard Inc. (NYSE: MA): 108% gain in the put options.
Nio Inc – ADR (NYSE: NIO): 50% gain in the put options.
NXP Semiconductors NV (NASDAQ: NXPI): 20% gain in the put options.
3. Covered Call Options Play
Napco Security Technologies Inc. (NASDAQ: NSSC) — Napco Security Technologies Inc. is currently trading at $29.38. The Oct. 21 $30 Calls (NSSC20221021C00030000) are trading at $0.75. That provides a return of about 8% if NSCC is above $30 by the expiration.