IOT – Your Bullseye Pick of the Week

My Trade Plan Details:

• IOT Jan 12, 2024 $35 calls near $1.20/mark>
• Stop: Close under $32.50
  
• Target 1: $37
  
• Target 2: $40

[Max potential win: 65%]

My Trade Plan Details:

• PATH Dec 29, 2023 $27 calls near $.40
• Stop: Close under $24.50
• Target 1: $28
• Target 2: $30

My Reasoning:

This week, I think the market will continue to be strong, and I want to go with stocks that are close to a breakout and an uptrend. 

One of the stocks that’s high on my list has extremely high short interest, and has been making consistent new highs for the year.

My Bullseye pick this week is to buy UiPath (PATH) calls.

Today, my plan is to open up a new position with PATH calls, hopefully near my target entry price. I am not too worried about getting the exact price, but I want to be close to my target entry.

I am going to keep a tight leash on this trade though.  If I see that PATH is going to close under $24.50, then I will cut the trade for a loss.

If I am right, then we should see a breakout near $28 as my first target, and possibly a quick pop to $30 after that if it really starts to move.  

We saw the same type of move happen the last few weeks with other picks, and I am hoping this leads to a breakout as well. 

My Trade Plan Details:

• SNOW Dec 22, 2023 $195 calls near $3
• Stop: Close under $186
• Target 1: $198
• Target 2: $208

Here’s how I traded it!

Trading is hard, but I managed to trade this one well, but they won’t always work this good.

My Reasoning:

As I have been getting ready for the coming week, I can’t help but remain bullish on the markets.

Everything in me says that we “are due” for a meaningful correction from the recent rally we just saw in November. But the market doesn’t care about my “feelings.”

It cares about price action, and right now, that seems to continue to head higher. There is not a great case I can make for why the technicals would break down this week.

I think the most painful trade is likely going to be higher from here as short sellers continue to leverage into bets against the market.

If stocks are going higher, then I want to go with a fast-moving tech stock near a breakout level, not something crawling off the lows.

I have to say, there is no lack of ideas this week. I could probably go with about a dozen different stocks right now that fit this criteria.

There is one that I am giving the edge to, however…

My Bullseye pick thisweek is to buy Snowflake (SNOW) calls.

My Trade Plan Details:

• CVNA Dec 15, 2023 $40 calls near $1.40
• Stop: Close under $34
• Target 1: $40
• Target 2: $44

My Reasoning:

Last week, I was helped by the extreme short interest in AFRM to help drive it higher. That was one of the biggest reasons I picked it, if you recall.

We also saw other high short-interest stocks like GME, UPST, and BYND make substantial gains lately as the market is putting the pressure on short sellers in those names.

This week, I am going to stick with this trend and target one of my favorite high-short-interest stocks.

This stock has a reported short float of nearly 40%!

It also got an upgrade today from JP Morgan. I have no idea why they would do that on this piece of junk, but it is giving the stock a little more fuel.

My Bullseye pickthis week is to buy Carvana (CVNA) calls.

My Trade Plan Details:

• AFRM Dec 8, 2023 $30 calls near $.40
• Stop: Close under $25
• Target 1: $30
• Target 2: $33

My Reasoning:

As you probably know, we had another record-breaking “Black Friday” for overall sales last week…

The market isn’t really cheering this on, but there is one segment that had a big hand in helping get this number to record levels – the “Buy Now, Pay Later” (BNPL) group.

Those are the companies that let you finance your purchases easily over several months, at a high-interest rate, of course!  (so don’t do this!)

The leader in this little group of stocks is Affirm (AFRM).

I think the surge in sales could provide a temporary boost for this stock over the next week.

Now, the problem is that the stock is already trading 50% higher than it was a month ago.  And don’t forget, I hate this stock.  It is junk!

Just because a stock is “junk” doesn’t mean that it can’t make a good move for a short period of time, though.  We just saw this stock make a significant move, as I just pointed out.

AFRM also has very high short interest.  Something in the neighborhood of 20% of all the shares outstanding are sold short.  

This can provide a temporary boost as some of those shorts have to become buyers when they close out their positions.

As much as I don’t like the stock, I think it has a good chance of making another 10%+ move from here.

My Bullseye pick this week is to buy Affirm (AFRM) calls.

AI – Your Bullseye Pick of the Week

My Trade Plan Details:

• AI Dec 1, 2023 $31 calls near $.80
• Stop: Close under $28
  
• Target 1: $31
  
• Target 2: $33

[Max potential win: 110%]

My Trade Plan Details:

• ERX Dec 1, 2023 $59 calls near $1.00
• Stop: Close under $54
• Target 1: $59
• Target 2: $62

My Reasoning:

Today, I will be looking to start a position in ERX with the option contracts listed below, hopefully near my target entry price.

I plan to make a half-sized position and leave room to add to this before Wednesday if the chart is still looking promising.

Keep your eye on those app alerts if you want to see when I am getting in and out of the trade during the week!

If I am wrong, then I will look to stop out of my position for a loss if ERX closes under $54.

If things go my way, I am looking to take profits near $59 and possibly even $62 as my target #2.

My Trade Plan Details:

• FDX Nov 17, 2023 $245 puts near $3.00
• Stop: Close above $251
• Target 1: $242
• Target 2: $235

My Reasoning:

This week is going to be a tough one to navigate. The Market is going to digest the gains from last week, and it will be tough to make a move much higher from here.

At the same time, I don’t think we will see a big dip either. My most likely scenario is that the market drifts slightly higher, and we see a choppy week.

That is a very tough time to buy options, because I am not expecting much of a move higher (or lower) for most stocks, and time decay kills options if they are not moving in your favor.

There are some very weak stocks that got saved last week by the rally. I don’t think anything has fundamentally changed for them, and it is probably good to keep betting they will go lower.

There are several stocks that fit that criteria for me, but there is one that stands out that I am looking to bet against right now.

My Bullseye pick this week is FedEx (FDX) puts.

As I said, I don’t expect an easy drop for stocks this week, but I do think that weak stocks like FDX will see selling pressure on any rallies.  

If I am wrong about this trade and it continues higher, then I will use a break above $251, which would be above the peak we saw on last week’s rally, as my stopping point.  

Remember, I always want to see closing prices, not intraday prices, for my stop losses.

If I am right, we will see sellers take advantage of last week’s rally, and I will lock in a profit in the low $240’s as target #1 and around $235 as target #2.

My Trade Plan Details:

• ZS Nov 17, 2023 $165 calls near $3.50
• Stop: Close under $151
• Target 1: $165
• Target 2: $170

My Reasoning:

One of the top sectors for the whole market right now is cybersecurity. As you can imagine, this is an area in high demand, especially as we have wars brewing all over the world right now.  Wars are rarely fought with guns today, but rather online. My top idea this week is at the forefront of this battle and has been one of the fastest-growing companies in any sector for the last couple of years. Right now, it is trading at a spot where I think it can make a big move as traders are likely to “buy the dip” we have seen recently.

My Bullseye pick this week is Zscaler (ZS).

My whole idea for ZS this week hinges on the tech market (QQQ) holding up and having at least a minor recovery this week.

Keep a close eye on QQQ, because if that continues to break down, then I don’t think any stock will be able to sustain a move higher this week – but I think we are due for a nice bounce, so I’m trying to catch a piece of it!

My Trade Plan Details:

• MARA Nov 10, 2023 $9 calls near $.40
• Stop: Close under $7.60
• Target 1: $9
• Target 2: $11

My Reasoning:

NVDA was great for sure, but don’t forget that the week before, I called ERX, which also made a 100%+ move.

That just reinforces my conviction that there is always a good trade out there, in any market condition, you just need to filter out the noise and focus on what is truly important.

Right now, bonds are the only thing that matter.  If you are ignoring what’s going on there, you are not paying attention to the right information.

Until we see a bottom form with the bond market, interest rates will continue to soar, and do some real damage to the entire economy.

If I had a choice (and we always have a choice as traders), I would sit out this week and wait until next week to trade.  This is not a great environment to trade either way.  I don’t see any easy shorts this week, with things so depressed already and I also don’t see a lot of reason why the market will rally.

This is just a tough week we are walking into, plus we have to deal with a ton of earnings from some of the biggest companies in the world!

However, something that has been working lately is Bitcoin.

It is late to the party, but investors are fleeing into “safe” assets right now, and while Crypto is not what I would call a “safe” asset, I do see the reasons why people would be buying again.

There are not a lot of Bitcoin stocks I would ever think about buying, but there is one stock I think has a good chance of having an outstanding week in that sector.

My Bullseye pick this week is Mara Digital (MARA).

I will cover everything I see in the 11am LIVE SESSION so make sure you attend today.

When I look at MARA this week, I see a wedge pattern for the last few weeks.  I would love to see this breakout to the upside above $8.50, and then I think it is off to the races.  

We have seen MARA make some very fast, big moves when it “wakes up.”  Maybe we will see that happen this week.

I will be looking to take profits around $9 on a spike, and then maybe even as high as $11 if Bitcoin can continue to rally.

If I am wrong, then I will use the recent support below $7.60 as my stop price for a loss.

I will also be setting up a higher-probability option-selling version of this trade for Alpha Hunter members today as well, so keep an eye out for that if you are a subscriber.