“Cabin Fever” Trades: 10 Straight Winners!

I always say my life is like a beer commercial. I do what I want to do and go where I want to go.

As you can probably imagine, I wasn’t exactly thrilled when the shelter-in-place orders went out to help stop the spread of COVID-19.  But hey, I get it. You have to flatten the curve. So I did what any self-respecting Chicago trader would do: I escaped!

I packed my family in the car and abandoned my high-rise apartment for my quiet lake house in Michigan. I figured there’s no point in trying to wait out a pandemic in the city – in the middle of a shutdown, no less.

I’m not exactly roughing it up here in Michigan, either. Thanks to modern technology, I’m not locked in some dingy trading bunker. I have my monitors and camera set up for my TV spots in the living room where I can take in the waterfront views and relax.

Knuckman

No “cabin fever” at the Knuckman house

Yes, these are unprecedented times. But the exchanges are open — and the trading opportunities are out there for you if you’re willing to tune out all the bad news and pay close attention to price.

In fact, I’ve still managed to knock out 10 winning options trades for my premium readers over just two trading days last week, including a clean double in Kraft Heinz C0. (KHC) and Newmont Corp. (NEM).

If there’s an opportunity out there, we’ll find it — even if it feels like the world is coming to an end!

Here’s how I see it: The consolidation we witnessed before last week’s rally was exactly what the market needed from a price standpoint. The averages needed to consolidate and shake around a little bit…

It’s not too surprising that we saw the follow-through from the consolidation that led to the best weekly performance in the S&P 500 since 1974. The sharp selling has subdued and the market has almost fought back to the halfway point of this unprecedented drop. If the S&P can take out 2,800, we can seriously begin to talk about a bottom being in place.

And no, I don’t think it’s crazy to start talking about a recovery right now. Remember, we’ve got buckets and buckets of money that are going to support this market no matter what thanks to the Federal Reserve.

Do not be surprised if the Fed somehow starts buying stocks soon! They will do anything to keep this market afloat.

Keep it In the Money,

Alan Knuckman

Alan Knuckman
Editor, In-The-Money


Chart of the Day: How to Play Gold’s Big Breakout

Greg GuenthnerGold is soaring again as the Fed continues to blast the market with endless stimulus plans.

We kicked off the year with the Midas Metal settling above $1,600 for the first time since 2013, thanks in part to 2020’s disastrous start that included tensions between the US and Iran, Hong Kong unrest, and now the COVID-19 pandemic. There’s certainly some serious fear in the markets right now and big money is looking for somewhere new to go, hence gold’s impressive performance.

After a couple of false starts, gold futures have finally taken out $1,700. The breakout hasn’t been an easy one to track. But it’s finally opening up plenty of new momentum plays in the sector.

gold chart

What started as a hedge is working as a hot trade — so there’s no shortage of new speculators taking a shot at a gold and gold miners right now.

On a long-term timeline, gold might be taking aim at its post-mania highs of $1,800. We haven’t witnessed bullion prices this high since 2012. But for our short-term trading portfolios, the explosive mining stocks offer the most bang for your buck (Alan’s already helped his readers book gains as high as 100% on a quick miner trade last week).

The VanEck Vectors Gold Miner ETF (NYSE:GDX) is once again pushing toward $30 following a massive 10% rally to close out the trading week. A clean break could trigger another powerful rally like we enjoyed last summer.

— Greg Guenthner

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Alan Knuckman

Alan hails from the home of options trading in Chicago, where he began working as a clerk on the floor of the Chicago Board of Trade (CBOT). Beginning with his days on the floor, Alan’s worked with all aspects of the options markets for the past 25+ years.

Transitioning from a clerk to a floor...

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