Alan the “Chicken Trader”

I’m back in Chicago this week, where I’m spending some of my free time working on an important project: tracking down an industrial smoker to set up at a local restaurant to promote my Chicken Ribs.

“Chicken that tastes like ribs” has been my backyard staple that I took into production as a ready-to-eat, healthy BBQ. They are Texas dry-rubbed and real hickory-wood smoked — so you get all the authentic flavor and low fat.

Like most things in life, the idea for Chicken Ribs goes right back to commodities. Long ago, I realized corn prices were the direct input in chicken costs. I recognized an opportunity (as my mind is trained to do) talking to chicken producers about feed cost hedging as they were looking for new products to pick up excess demand.

ribs

I’ve always been a grill guy. They say boat owners are never satisfied and always want one that’s ten feet bigger. Well, the same is true for me with smokers and grills. I have three on my condo deck in Chicago — and many more at my lake house for any and all occasions.

Thankfully, I just found one that does 100 pounds of brisket, 50 pounds of ribs, or 20 whole chickens. It has indoor venting for use in a restaurant kitchen. Plus, the BBQ smell wafting around can’t hurt sales.

The plan is for the restaurant to smoke chicken daily. It’s not as easy as heating up the frozen chicken ribs yourself at home, but it is a win-win for all the BBQ lovers out there.

Keep it In the Money,

Alan Knuckman

Alan Knuckman
Editor, In-The-Money

PS: Like I always say — you can find great opportunities every day, in life and the markets! That’s why I wanted to give you the chance to try my Chicken Ribs. Click here and enter the code “ChickenTrader” at checkout for a special discount.

Chart of the Day: This stock’s rally was too good to be true

Greg GuenthnerThe tech trade is red hot once again this week as the mega-cap market leaders extend their gains.

The usual suspects are breaking out of consolidation patterns and attack all-time highs.

But while trader favorites like Tesla Inc. (NASDAQ:TSLA) rocketed higher, one upstart imposter suffered a nasty breakdown…

You might recall Nikola Corp. (NASDAQ:NKLA) — an alternative energy auto stock that caught fire during the post-crash rally this spring. The company, which claims to be developing a hydrogen-powered truck, just appeared on the Nasdaq this spring following a reverse merger with VectoIQ Acquisition Corp.

Despite its lightning-fast rally, we were skeptical of this stock from the start (the blatant rip-off of using the first name of famed inventor Nikola Tesla was a major red flag). The company also doesn’t expect to book any revenue until next year, yet it’s taking pre-orders for trucks which it has yet to manufacture.

When I first brought NKLA to your attention earlier this year, I mentioned that I wasn’t sure if the company will be around in five years. Now it looks as if the ride is just about over for all the greater fools who were late to the party. The stock dropped a whopping 20% to kick off the trading week after the company announced it would sell 24 million shares.

Needless to say, shareholders weren’t happy with the dilution. Just look at the chart:

NKLA

Those gains from June have already vanished. As we suspected, traders piling into this stock without an exit plan got burned. The stock has now dropped 60% from its June highs. Ouch…

Trading Tip of the Day

Stocks like Nikola that go parabolic do not correct sideways.

When you see a stock moving into extremely overbought territory and posting a chart that starts to look like a hockey stick, you expect a sharp reversal to appear at some point as too many traders race for the exits with whatever profits they can carry…

Of course, there’s nothing wrong with trying to play a stock that’s screaming higher. But it’s important that you learn to recognize the signs of a stock that’s gone vertical. If you aren’t in these plays for the long haul, it’s best to remain aggressive when taking profits. You’ll rarely nail the top — but you will save yourself a lot of pain (and money) by taking gains off the table early and often.

All good things must come to an end. Eventually, the momentum crowd always abandons these sweetheart plays for the next hot ticket…

— 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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