Market Insights
Bringing you the trading news around the world.
Stories
The Structure of Options Trades
While options can be traded by themselves, investors often use them in conjunction with other securities. So before going further, let's consider the four basic ways that options trades are structured. You Can Trade Options by Themselves As we learned in a previous...
Buying and Selling Options
Most clients understand buying and selling stocks. Options are similar, and can be traded in the same brokerage accounts. However, you should know some basic differences. Bid / Ask Spreads Matter A bid/ask spread is the difference between where you can sell a security...
Essential Options Knowledge: Time, Volatility and Different Kinds of Value
Options confuse a lot of investors because several factors impact their value. Unlike stocks, they don't just go up and down based on supply and demand. This post will explain three of the most important concepts you need to get started: time, volatility and intrinsic...
Chart of the Day: Royal Caribbean May Be Cruising Lower
Royal Caribbean Cruises drifted higher since the summer, but now it may be rolling over. The first pattern on today’s chart is the level around $61.45, where the leisure stock bottomed in March before proceeding to new lows. RCL peaked around that price on November 15...
Stocks Fall as Fed Drives Fear About Earnings and a Potential Recession
Stocks fell again last week as the Federal Reserve's tough stance on inflation made investors worry about earnings and a potential recession in 2023. The S&P 500 slid 2.1 percent between Friday, December 9, and Friday, December 16. The Nasdaq-100 fell even more,...
Negatives Are Piling Up in This Year’s Only Positive Sector
Energy stocks are the only positive sector in 2022, but they're ending the year under a cloud of negativity. Crude oil futures (@CL) have fallen 13 percent so far in December, putting them on pace for their biggest drop in over a year. They're down in six of the last...
Technical Analysis: What If Apple Holds This Price Level?
Megacap technology stocks like Apple have dragged on the market amid disruptions in China. But what if the iPhone giant manages to bounce? Could it give the bigger indexes a boost? The main pattern on today’s chart is the $140 level. This price first had importance on...
Attention Amazon Traders! Check Out This Chart
Amazon.com has declined along with the broader Nasdaq-100. But other consumer-facing companies have fared much better. The chart below compares AMZN with competing retailers. It uses percentage-change charts with a six-month interval. Notice how the e-commerce giant...
Stocks Could Face a Lull as Investors Wait for Bigger Events Next Week
Action in the stock market could hit a brief lull as investors wait for big events later in the month. The S&P 500 rose 1.1 percent between Friday, November 25, and Friday, December 2. All of the gain occurred on Wednesday after Federal Reserve Chairman Jerome...
The Structure of Options Trades
While options can be traded by themselves, investors often use them in conjunction with other securities. So before going further, let's consider the four basic ways that options trades are structured. You Can Trade Options by Themselves As we learned in a previous...
Buying and Selling Options
Most clients understand buying and selling stocks. Options are similar, and can be traded in the same brokerage accounts. However, you should know some basic differences. Bid / Ask Spreads Matter A bid/ask spread is the difference between where you can sell a security...
Essential Options Knowledge: Time, Volatility and Different Kinds of Value
Options confuse a lot of investors because several factors impact their value. Unlike stocks, they don't just go up and down based on supply and demand. This post will explain three of the most important concepts you need to get started: time, volatility and intrinsic...
Chart of the Day: Royal Caribbean May Be Cruising Lower
Royal Caribbean Cruises drifted higher since the summer, but now it may be rolling over. The first pattern on today’s chart is the level around $61.45, where the leisure stock bottomed in March before proceeding to new lows. RCL peaked around that price on November 15...
Stocks Fall as Fed Drives Fear About Earnings and a Potential Recession
Stocks fell again last week as the Federal Reserve's tough stance on inflation made investors worry about earnings and a potential recession in 2023. The S&P 500 slid 2.1 percent between Friday, December 9, and Friday, December 16. The Nasdaq-100 fell even more,...
Negatives Are Piling Up in This Year’s Only Positive Sector
Energy stocks are the only positive sector in 2022, but they're ending the year under a cloud of negativity. Crude oil futures (@CL) have fallen 13 percent so far in December, putting them on pace for their biggest drop in over a year. They're down in six of the last...
Technical Analysis: What If Apple Holds This Price Level?
Megacap technology stocks like Apple have dragged on the market amid disruptions in China. But what if the iPhone giant manages to bounce? Could it give the bigger indexes a boost? The main pattern on today’s chart is the $140 level. This price first had importance on...
Attention Amazon Traders! Check Out This Chart
Amazon.com has declined along with the broader Nasdaq-100. But other consumer-facing companies have fared much better. The chart below compares AMZN with competing retailers. It uses percentage-change charts with a six-month interval. Notice how the e-commerce giant...
Stocks Could Face a Lull as Investors Wait for Bigger Events Next Week
Action in the stock market could hit a brief lull as investors wait for big events later in the month. The S&P 500 rose 1.1 percent between Friday, November 25, and Friday, December 2. All of the gain occurred on Wednesday after Federal Reserve Chairman Jerome...
Stocks Cling to Support as Inflation Rages and Interest Rates Surge
Stocks are trying to hold a support level as investors worry about inflation and soaring interest rates. The S&P 500 slid 0.2 percent between Friday, April 29, and Friday May 6. The index swung wildly despite the small closing change. It initially plunged within a...
Global Fears Distract from Earnings as Advanced Micro and Meta Surge
Earnings season is normally a big time for the stock market, but these days investors have bigger fish to fry. Companies including Apple (AAPL), Microsoft (MSFT) and Tesla (TSLA) barely moved after issuing quarterly results. Each beat estimates on both the top and...
The Nasdaq Just Had Its Worst Month Since 2008 as the Fed Prepares to Battle Inflation
The selloff in growth stocks worsened last month as a perfect storm of rising rates, geopolitical risk and poor earnings hammered the Nasdaq-100. The technology-heavy index plunged 13 percent in April, its biggest monthly drop since October 2008. Other benchmarks like...
Twitter Jumps Into TradeStation’s Top 10, Thanks to Elon Musk’s Takeover
Advanced Micro Devices remained the busiest symbol at TradeStation Securities in April as quarterly results approach. The semiconductor stock plans to report earnings on Tuesday, May 3, after the closing bell. The shares have been testing their lowest levels since...
Fed Worries Just Hammered Stocks, But Now It’s the Busiest Week of Earnings Season
Stocks tumbled last week as the Federal Reserve grew increasingly hawkish in its battle against inflation. Coming sessions could be different as major companies like Apple report earnings. The S&P 500 slid 2.75 percent between Friday, April 15, and Friday, April...
Are Bulls An Endangered Species? Buyers Go on Strike as Inflation and Geopolitical Risks Mount
Investors are heading for the hills as inflation rages and geopolitical risks mount. The S&P 500 slid 2.1 percent in the holiday-shortened week between Friday, April 8, and Thursday, April 14. The Nasdaq-100 continued to underperform, dropping more than 3 percent...
The Fed Gets More Hawkish, and More Stocks Are Breaking Out
Stocks fell last week as the Federal Reserve got even more hawkish. However some potentially bullish trends are developing as money drains away from technology. The S&P 500 slid 1.3 percent between Friday, April 1, and Friday, April 8. It was the first negative...
Chart of the Day: Is Tesla Going into Reverse After a Sharp Rally?
Tesla had a sharp rally in late March, but now there could be evidence of sellers taking the wheel. The first major pattern on today's chart is the trendline running along the peaks of November 4, January 4 and April 5. Each time prices have approached with a bang,...
The Stock Market Has Changed Dramatically This Year. Here Are 3 New Trends
The stock market hasn't just pulled back in 2022. It's also showing new trends as investors react to very different environment from recent years. This article will highlight the new conditions and what they could mean for your money. Here's the list: Traditional...
Will the Nasdaq Pull Back next Week?
Is the Nasdaq headed for a selloff next week? Someone seems to think so. Here's a breakdown of the massive bearish put spread that appeared yesterday in the PowerShares Trust (QQQ) that tracks the Nasdaq-100 index: A block of 50,000 10-August 173.50 puts were bought...
Pharma Bulls Chase Blue-chip Breakout: Options Recap
A blue-chip drug giant beat estimates this week, and the bulls are chasing in the options market. As we mentioned on Monday's Market Action, maker Pfizer (PFE) was expected to announce positive earnings of about $0.74 per share on Tuesday morning. They crushed that...
How Time Was Money on Tech Earnings: Winning Trade in Apple
Earlier this week, we outlined a potential options trade on Apple (AAPL) before earnings. That strategy hit maximum profit this morning after strong results sent the tech giant to a new all-time high. Let's take a look with TradeStation's OptionStation Pro. The green...
Riding a megabank on the cheap: Options recap
One big investor is riding a megabank on the cheap, thanks to the leveraging power of options. Bank of America (BAC) has been on the move since late 2016. A large call roll yesterday seemed to show that a money manager is using options as a surrogate for owning...
Bears Target Consumer Heavyweight: Options Recap
Bears were moving in for the kill as a giant consumer staples firm prepared earnings. Procter & Gamble (PG), after all, has had anything but a strong track record. The parent of brands like Gillette, Pampers and Tide dropped fell after its last three quarterly...
Know Your Options: Diagonal Spread Targets Apple Volatility Crush
One of the most predictable things in the market is time decay after a big event like earnings. Have you ever used a diagonal spread to capitalize on the change? Today we'll see how it's done. First, remember that option premiums attempt to factor in price swings. As...
Caution Reigns in Chip Space: Options Recap
Options traders are bracing against a drop in chip makers as earnings season marches on. Here's a breakdown a large bearish spread in the Market Vectors Semiconductor ETF (SMH) yesterday: Roughly 22,000 September 100 puts were bought for $1.85. Roughly 22,000...
Trading the Volatility Crush after a Quarterly Earnings: Options in Focus
Disclaimer: This post is intended for education purposes only and should not be interpreted as a recommendation. Trading options may not be suitable for all investors. Options are all about movement and time. The more movement, the more expensive the options. The more...
Bulls Target Steel Giant with Leveraged Trade: Options Recap
One big investor is apparently feeling bullish as the world's top steelmaker moves higher. ArcelorMittal (MT) had its busiest session in over a year on Wednesday. Here's a breakdown of the large, leveraged strategy that accounted for more of the activity: A block of...
Are Metals Quietly Breaking Out?
Most attention this week is focused on hopes of pro-business tax reform in Washington ...meanwhile investors seem to be shifting money into an industry outside the current spotlight: Metals. The SPDR S&P Metals & Mining Fund (XME) has gained almost 6 percent...