Just sent this out in my newsletter:
Tomorrow I will be purchasing AMGN 55x April calls which closed today at .67. I'm hoping we see a red day tomorrow so I can pick up the calls on a little dip. The markets have been very volatile lately with large up and down swings every day. Today the Dow Jones Industrial gained 124 points, so I'm not counting out a down day for tomorrow.
Back to AMGN... First off, the chart is looking bullish again. AMGN has made multiple bottoms in the $50 - $51 range over the past year. Once again it has bounced off its pivot points in this range and closed today at $52.52 testing the 20 sma.
Signals to go long:
- Bullish MACD crossover
- Slow Stochastics turned up
- Pinch play setup
- Multiple bottoms (held major support)
Take a look at Amgen's chart via Finviz:
[pic - click to view]
Now, something interesting happened with Amgen yesterday. According to Schaeffer's daily market blog, yesterday there were roughly 14,000 calls traded compared to only 1,930 puts. Apparently one trader created a long call spread by purchasing 4,800 52.5x calls and selling an equivalent number of March 55x calls. With this strategy the goal for AMGN would be for its price to finish at or near $55 by next Friday's expiration.
So again the play for me tomorrow is to purchase the April 55x calls. I won't be purchasing the March calls because of the current market situation and the middle east unrest. Instead I'm going to give myself more time and if AMGN does move up as expected then there will still be some very nice gains.
AMGNNNNNNNNNNN :dancingcool: :dancingcool:
+3% while markets sell off :agreement6:
Up about 50% on my calls now :cool-smiley-009: