My Trade Plan:

  • Stop:  Under $68
  • Target 1: $71
  • Target 2: $73+


My Trade:

  • Buy XLU Calls
  • Strike: $68 Calls
  • Expiration: Feb 11 2022
  • Price: near $2.00


XLU - Bullseye Pick of the Week

Original Alert went out on January 24, 2022

With fear, uncertainty, wild interest rates, there are many reasons starting to shape why traders and investors want to look at the utilities for defenses.

And the utilities sector is one of the primary sectors where investors park money as they rotate out of risky asset classes and wait for new opportunities.

I’m starting to think it is a good bet for the next few weeks at least as the bears have really stepped back into the markets to capitalize on the fear of investors.

If I am wrong, I will keep a tight stop on this trade.  If XLU closes under the pivot lows near the support level of $68, I don’t want to stay involved with this name any longer.

Otherwise, I think that the pivot highs make a great target area around $71, and then near $73 after that if the trade really works out.

Pro tip:  When you are trading the XLU, you can’t expect a long of big moves like a high-beta stock.  Volatility is usually lower, and therefore options are cheaper.  Compared with tech stocks, I’m looking for smaller moves in this name compared to otherwise traded stocks.

XLU – Bullseye Pick Of The Week


Good Morning Traders,

This has been a very rough start to the year for most traders.  

It’s hard to believe that we are only 3 weeks into 2022 after all of the damage that has happened.

Instead of trying to short an already oversold market or trying to be a hero and pick the bottom, I want to play some defense this week.

Current Market Outlook:

Now before I get too far, I wanted to remind everyone that just because the markets are looking bleak, there are still pockets of opportunity.

And last week the chance was in DWAC which turned out to be a top performer amongst all of the carnage.

Now for this week I want to start preparing for some defense.  One of the strongest sectors, and most boring, are the utilities stocks.

Instead of trying to find the best one out of the bunch, (my bet would have been NEE, but earnings are coming out soon) I am going to look to buy the utilities ETF, the XLU.