This morning, two more 50% gains were triggered!
I have to say — one of those gains is outright amazing.
As you may recall, last week, I sent you several emails managing our trades.
On Monday, I let you know we grabbed a 50% gain on the first half of our Amazon trade, but also that two of our positions were down more than 75%.
One was AIG, and we were stopped out of that position last week. The other was Advance Auto Parts (NYSE: AAP). And just a week later, we’re up more than 50% on AAP!
We canceled our standing orders to sell half at 50% when we set our stop. Then we canceled the stop-loss because of the action on some of our other stops from last week.
So, today, I want us to go ahead and lock in a gain on the first half of this trade.
We’re going to put back in place our order to sell half at whatever nets you a 50% gain.
Here’s your action to take:
|Action to Take|
|Stock:||Advance Auto Parts Inc. (AAP)|
|Option Type:||Call Option|
|Action:||Sell to Close Half|
|Order Type:||Limit Order|
|Duration:||GTC (Good ‘Til Canceled)|
|Limit Price:||Whatever nets you a 50% gain based on your entry price. (Example: Sell half your contracts at $7.80 if your entry price is $5.20.)|
|Trade Deadline:||Keep this order open until it is filled or canceled.|
At last glance, it was trading at $7.90.
What a swing this position was. It’s absolutely phenomenal for a position to rebound from a loss of greater than 75%. Now, because you were patient and were able to stomach that volatility, you’re in position to grab a 50% gain. Congratulations!
Once those orders are filled, I’ll let you know.
Our other 50% gain today came from Caterpillar (NYSE: CAT).
We had in place our standing orders to sell half at 50%, and the price spiked this morning to $7.25, which should’ve cleared most of your limit orders to sell half. If it didn’t clear your order, here’s your Action to Take: Sell half of your position at the market today.
Officially, we hit a 50% gain at $6.96, so $7.25 should’ve been high enough for almost everyone to grab a gain.
Normally, we would place a stop at whatever would net us a 10% gain on the second half. But, as I explained last Thursday, we’re no longer going to place stop-losses with a broker. Instead, we’re going to track our stops internally. So I’ll update you when it’s time to take action. We’re still going to stick to roughly a 10% gain on the second half, but I’ll send you an alert to sell when it’s time to exit a position.
That’s all for today.
We’ll continue to benefit from our existing earnings drift patterns, and I’ll alert you when a new trade is triggered.
Chad Shoop, CMT
Editor, Earnings Drift Alert