Trade Alert: Lock In a 100% Gain in Three Days!

Since yesterday’s close, we’ve had multiple companies on our watch list report earnings. Of those, three hit our parameters — one of which we won’t be trading until three weeks later.

That means we’re going to jump into two trades today, so let’s get right to it. (We also made a nice 100% gain in Netflix, which I’ll cover in a moment.)

The first trade is to buy calls on Juniper Networks Inc. (NYSE: JNPR), a developer and marketer of networking products.

The company posted nice earnings after yesterday’s close. It topped analyst estimates by 11%, and then the stock shot up 6% on the open this morning — surpassing our parameters for making a trade. Based on our 10 years’ worth of historical data, we know that when Juniper Networks reports earnings this strong, the stock gets a boost over the following month — about 7% on average. And we can magnify those gains by buying call options. In fact, when we traded it in our beta test, we made a 50% gain on the first half and a 10% gain on the last.

So we’re going to grab calls today and hold them for one month.

Here’s your action to take:

Action to Take
Buy Action to Take
Stock: Juniper Networks Inc. (JNPR)
Option Type: Call Option
Expiration: Dec-16-2016
Strike Price: $27
Option Symbol: JNPR161216C00027000
Action: Buy to Open
Order Type: Limit Order
Duration: GTC (Good ‘Til Canceled)
Limit Price: $0.90
Trade Deadline: If your order is not filled by my next update, I will update you on the trade.
Note: Do not place a market order. Set the limit order at $0.90.
Once this order is filled, place the following order:
Sell Action to Take
Stock: Juniper Networks Inc. (JNPR)
Option Type: Call Option
Expiration: Dec-16-2016
Strike Price: $27
Option Symbol: JNPR161216C00027000
Action: Sell to Close Half
Order Type: Limit Order
Duration: GTC (Good ‘Til Canceled)
Limit Price: Whatever nets you a 50% gain.
Trade Deadline: Keep this order open until it is filled or canceled.
Note: This second order will allow us to collect a 50% gain on half of our position in the event that a quick move happens before I can get a trade alert out to you.

Our next trade is to buy calls on Akamai Technologies (Nasdaq: AKAM), a cloud-services provider and content-delivery network.

The company also beat earnings estimates by roughly 11% yesterday, and its stock jumped more than 8% before the open today, triggering a trade. Instead of holding this company for a month like Juniper Networks, our research says to hold Akamai for a slightly shorter period — just three weeks. When we traded it this way in our beta test, we made a 50% gain on the first half and a 180% gain on the last.

Here’s your action to take:

Action to Take
Buy Action to Take
Stock: Akamai Technologies Inc. (AKAM)
Option Type: Call Option
Expiration: Nov-18-2016
Strike Price: $67.50
Option Symbol: AKAM161118C00067500
Action: Buy to Open
Order Type: Limit Order
Duration: GTC (Good ‘Til Canceled)
Limit Price: $2.20
Trade Deadline: If your order is not filled by my next update, I will update you on the trade.
Note: Do not place a market order. Set the limit order at $2.20.
Once this order is filled, place the following order:
Sell Action to Take
Stock: Akamai Technologies Inc. (AKAM)
Option Type: Call Option
Expiration: Nov-18-2016
Strike Price: $67.50
Option Symbol: AKAM161118C00067500
Action: Sell to Close Half
Order Type: Limit Order
Duration: GTC (Good ‘Til Canceled)
Limit Price: Whatever nets you a 50% gain.
Trade Deadline: Keep this order open until it is filled or canceled.
Note: This second order will allow us to collect a 50% gain on half of our position in the event that a quick move happens before I can get a trade alert out to you.

Like I said, there was also another company that announced earnings this morning and hit our parameters, but we will wait a few weeks before announcing that trade since this company’s shares usually pull back after such a strong earnings report.

That’s it for our new trades. And remember, to ensure we’re creating a great product for you, I need your feedback. So tomorrow I will send you a quick survey asking you how the trading process went.

A 100% Gain in Netflix

As of this morning, we are officially out of our November calls on Netflix (Nasdaq: NFLX). Our $8 protective stop-loss orders were hit earlier, netting us a 100% gain on the second half of this trade.

If your orders weren’t hit, I suggest selling this position at the market now since we are no longer following this trade.

This was a nice first trade for us. We made a 50% gain from the first half and a 100% gain from the second half — all in about a week’s time. This is a perfect example of the Earnings Drift Alert system working in real time.

So please, let me know how you did — what gains did you personally make and how easy was the trading process for you? Were you satisfied with the trade?

You can answer those questions in the brief survey below:

As a sidenote, I realize that we mentioned the Netflix $120 October call option symbol when restating the trade details in the last couple of stop alerts. As you know from the original alert, we entered the November $120 calls, not the October ones. This was an editing error, and I apologize if it caused any confusion.

With that said, there are still about 30 other trades on our radar for this week, so we will keep you updated when one gets triggered.

If nothing else happens that requires action from us, I’ll talk to you again next week.

Until next time, good trading…

Jeff Opdyke
Editor, Earnings Drift Alert