Liz here, starting the last two ridiculous weeks before my wedding. If you’ve never sat in a rustic lodge with a lady who looks like an owl, telling you that you need liability insurance in order to use plates made out of slabs of log, YOU HAVEN’T LIVED.
You ALSO haven’t lived if you haven’t surfed the VWAP in Kenny’s Warlock’s War Room. Here’s what that’s about.
Anyway, today is the inauguration of “Mark Monday,” which is exactly what it sounds like – Mark Sebastian’s agreed to be my regular Monday feature. And today he’s got a succinct tip for you: “This f***** is going to $50.”
It’s also going to make you 300%, so you’ll want to take a look at this mf*****.
(We’re working on not using “jail talk” at home, but sometimes my fiancé’s work does bleed over a little.)
Even before we get to that point, though, I want you to lock in some profit on XOM, which is currently sitting at around 50% gains. (Thanks again, Mark!) It’s eroded a little bit from 60% last week, when we last checked in on it, and I want you to take home 50% on at least half of your position today.
If I were in this play, which I’m legally not allowed to be, it would probably AT LEAST cover my shuttle service rental from the hotel to the venue. (“Did you know you needed that?” No, Owl Lady, I did not.)
Then I want you to go ahead and leave the other half of the position to ride until XOM reports earnings closer to the end of the month. Cool?
Here’s what to do.
Snatch A Quick 50% on The Fat-Cheeked Oil Patch Kid
In case you missed my drawing of the Oil Patch Kid, I’ll include it again here. It is, in my humble opinion, worth a second outing.
|Action to Take:
SELL-to-CLOSE half of your XOM Nov. 19 $60 Calls (XOM211119C00060000) at a gain of 50% or better. Leave the other half of your position to ride for further gains.
Exxon’s confirmed that its earnings will hit on Oct. 29 (right around the time my bridal party is getting into town), and it’s expected to beat analysts’ estimates by a handy margin.
So lock in 50% now and get ready for Round 2 later.
And now for Mark’s actual “Mark Monday” recommendation, which he sees headed to 300% in a matter of weeks.
BAC to the Future
I actually got to watch all three “Back to the Future” movies in the theater on “Back to the Future Day,” Oct. 21, 2015, with my first husband Sean, whom we did not know at the time was very ill. He always got a big kick out of “Jaws 14” (this time, it’s really, REALLY personal).
In the midst of life, we are in death.
Today’s “BAC to the Future Day” (Nov. 19, 2021) has less to do with “Jaws” and more to do with a massive triple-digit gain on Bank of America (NYSE: BAC).
Shares of Bank of America, where I myself have been a loyal customer for 16 years because I am too lazy to switch over, just reached a new 52-week (and, for that matter, multi-year) high, with the stock up about 50% YTD.
In recent Q3 earnings, it beat earnings-per-share (EPS) by $0.14 and revenue by $1.17B (’tis the season – visit Kenny!) and just reported a record number of consumer checking accounts (I am one of, apparently, 34.2 million). New wealth management clients are also piling in, leading to the aforementioned 52-week high:
Here is the mirror image chart of that that Mark sent me:
One of the first things he looks at is low IV. IV shows whether the fear and uncertainty surrounding a stock is high or low, and it tends to inflate ahead of known catalysts like earnings. On the flip side, the rapid deflation after earnings (called an IV crush) can put options on sale.
When IV is low, that’s when you should buy options. Because no matter if you buy a call or a put, low IV can produce asymmetrical returns.
It can also protect you from losses at the same time, since the maximum risk on a bought option is the initial premium paid.
If you’re interested in reading the full, in-depth report at Profit Takeover, you can get that for free right here.
Oh, and I’ve always liked this quick, succinct “cheat sheet” that shows you how Mark picks low IV options trades, as well.
(Speaking of “what the fluff,” I just talked to my brother Forrest, who runs a massive division at Google, and he told me he was fighting with “Compliance” on whether or not he was allowed to use the word “freakin'” in a headline. There are some advantages to not working for Google, I suppose.)
Mark’s used this process to pinpoint exactly which BAC options to buy this time, of course. “Call overwriters on the $50-strike options are crushing volatility,” he said. “The November $47 calls are $1.00.”
He then concluded, and as always, I quote, “This f***** is going to $50 and we’re looking at a 300% gain on options.”
Since $1 options have a “Nickel Slots” feel to me, we’ll go with that. I’m putting the limit at $1.20, because as I write this, these have already started to drift upwards just a tad (as always, good eye, Mark).
Here’s what to do:
Action to Take:
BUY-to-OPEN BAC November 19 $47.00 Calls (BAC211119C00047000) at a limit of $1.20.
Enter as a Good-til-Canceled (GTC) order.
I can’t tell you how much I wish I were allowed to trade these myself. I can picture my next conversation with Owl Lady (fortunately, there are only two remaining weeks that I’ll need to deal with her):
“Were you aware that you still need to give us our $1,500 deposit for sorting your dessert forks?”
“Why no, Owl Lady, I was not, but fortunately I just made 300% on BAC and I have discretionary funds. What other hellish incidentals do I need to cover?”
(I’m such a Tradezilla, I know.)
I’ll be back tomorrow with a new play from CJ, now that I’ve recovered a little from his mention of Pittsburgh last week.