Netflix Still Has Room To FallDespite a 36% dive, $NFLX can fall another 29% and still post a small gain for the year.
Given rising volatility and a broad-market correction, a short position on Netflix could be a good idea.
A bearish strangle with expirations on DEC21 is what I'm currently holding. The possibility for an end of year rally is still there (hence using a strangle for protection if things go awry), but the probability of that rally grows increasingly slim - particularly within the FAANGs as a correction is far past due.
Options-strategy
BABA options Trade.. Hit $160 by Tues, and $175 by ThnxgivingNYSE:BABA
Tech: Has had trouble breaking thru major 382 fib level. Shallow “2 wave” due to market rally and AMZN (same sector) price action..
Trade Rationale: Alibaba’s Singles day (Amazon prime day equivalent) is Monday 11/11/18.. BABA reported highest consumer signups ever and last years 1 day rake was $24B.. I think the if news reports anything remotely good on the numbers, that will give NYSE:BABA enough BUY volume “Boom POW” momentum to get it over the 382 wall it needs to climb... and plus, JD.com ain’t been doin all that well w market share... #JD .com down -49% YTD ~ (-$30.9B mrkt cap)
and BABA down -18% YTD -$82.5B mrkt cap
Option strategy.
1. Long Nov 23 $160 Call Option, Trading at $0.78 currently.. when it hits, 451% return
Stop loss: think, If Baba < $144 = BAD
2. Long Dec 7, $175 Call Option, Currently trading $0.47... If it hits, 1,581% return... Lol
TSLA to $485 by apr?I'm not actually getting in on this trade, there is too much uncertainty around Musk and Tesla for my liking at the moment. I have traded TSLA in the past. This is a stock I would like to see get less unpredictable. That being said, the monthly candle suggests conditions for a bull run.
Bear move coming for NFLX, 26% drop by FebI'm actually long on NFLX stock but I think it'll drop over the next quarter. Overvalued compared to the other streaming services but lots of original content and a huge expected increase in subscriptions to streaming services over the long term.
This chart is based on a monthly consolidation but I am showing the weekly candle to show that my last 5 forecasts with NFLX all hit their targets, although they were shorter term targets.
$XLY Bearish Credit SpreadXLY Bearish Credit Spread - Opened. XLY leaning very bearish this morning (Monday) with a possible movement to test the 115 area as expected.
Entry 116.11.
Break Even 116.68.
1.7:1 r/r
Even with the heightened volatility this week, we will let this spread expire as it has a defined risk and reward.
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FACEBOOK BUY OPPORTUNITYFB GAP DOWN IS A HUGE BUY OPPORTUNITY
Facebook's earnings report a week ago upset investors and the stock fell more than 15% forming a huge gap.
Now stock is trading with P/E ratio of ~20 which I believe is very low for tech stock such as FB. Twitter has a P/E of 3X that of fb. Solely P/E is definitely not a good way to analyse any stock, however my analysis tells me that facebook still has huge potential and it is not to be traded at such low levels. FB has potential to generate cash and Zuck is definitely not a man who wouldn't want to use that opportunity.
Anyway, I think this is one of these Jamie and Charlie opportunities, Here is my strategy:
SELL SEP 13 195 PUTS
I will be shorting puts because I believe that the recovery will be steady and may take time. Selling puts is risky because if the stock drops you can lose way more than you have invested. However, Because I believe that there will be a steady comeback, selling puts is better because options are cheaper every single day due to THETA, which means that calls will be cheaper every day, therefore selling puts with high theta will be profitable even if the stock stays at the same levels.