â€‹REAL LIFE TRADING SPRING PORTFOLIO 2017: THIRD EDITION
Real Life Trading spring portfolio 2017: Third Edition
Hello my beautiful friends, wonderful people, and enriched traders from all over the world. Over here in the United States, Spring is winding down, especially here in Nashville, TN. The sun is starting to get itâ€™s intense blaze on, the pools have opened up, everything is green, hot, and ready for Summer!
As you likely know, every month at Real Life Trading we have a theme. Something life related. June is Nature Month and the challenge is to find and explore a park, waterfall, or nature reserve; simply go somewhere in nature that youâ€™ve never been before and send us a picture. Already, weâ€™ve seen some great images! Like these below:
The U.S. Markets are also heating up! The Nasdaq and S&P500 are at all time highs. â€˜Sell in May and go awayâ€™ didnâ€™t really work that well at all for 2017. The Russell 2000 however is still trading magnificently sideways, which is working out perfectly for this once bull put spread, converted into an iron condor.
Can you believe this is already the 3rd edition of the Spring Portfolio? Wow. The 1st edition of Summer will be out in just a few weeks, so keep your eyes peeled for that gem.
One of my really good friends and exceptional trader Matt D. (who also happens to be part of #TeamNashville) created this really cool â€˜RLT portfolioâ€™ in Finviz. He took 100k (virtually) and split that 100k up evenly 5 times to cover the 5 stocks listed in the RLT Spring portfolio. You might be quite pleased with those results below (this image is about 1 week old, as Matt is enjoying his cruise to Alaska right now).
Anyways, I am sharing that with you to get an overall idea and grasp at how some of the stocks and analysis have performed since we started this portfolio just back in March.
Now, letâ€™s get started with the stock chatter. Thereâ€™s a lot I am eager to update you on!
1. Red Hat Incorporated: Ticker RHT ~ Analysis on June 6th, 2017
Wow. This stock has simply performed like a majestical unicorn ever since we started analyzing it and creating set ups on it.
All I can do is simply three things from here on RHT.
#1 Iâ€™ll post the analysis I had on RHT back in the last write up, where I expected and anticipated the longer term retest of the $86.12 price range and the bounce from there.
#2 Show you the current chart:
#3 And then provide some fib targets from here:
The trend on RHT is gorgeously bullish. From here, itâ€™s simple. Plan on buying a dip. Buy into weakness, sell into strength, buy low, sell high ~ all of that sage investing advice will apply handsomely to this power house of a mover! We totally wrecked this one. Great job team!
RHT price from the first article: Up $5.64 [6.52%]
2. Snap Incorporated: Ticker SNAP ~ Analysis on June 6th, 2017
Well, turns out SNAP missed earnings back on May 11th. No large surprise there. The one small caveat to that, many Real Life Traders had some puts going over earnings on SNAP. The gap was nice, some traders squeaked out about an R or so. And boy, did that retest gap fill quickly.
That was purely from the shorts buying to cover, locking in gains, AND those traders who waited a few months for the IPO hype to calm down.
I know my buddy Sammy E. is keeping a close eye on SNAP as he is intending to play it bullish. Iâ€™m eagerly awaiting lockup to expire, to determine what type of selling comes in and how quickly.
The truth is, there is never a sure thing in the markets right? Therefore, even though SNAP seems pretty bearish on many levels of fundamental and technical analysis, the markets and overly optimistic buyers will not make it easy to just stay in a longer term short on SNAP.
I officially lost my wager on SNAP by .59; pretty brutal if you ask me.
The interesting part about SNAP recently is that it has formed 2 pretty text book pennant patterns.
The first one broke out bullish (filing the gap completely) but it only lasted one day. I was prepared to actually (cough, cough) go bullish on SNAP if the most recent pennant broke bullish again, but it didnâ€™t.
My current analysis is still semi bleak on SNAP and it wonâ€™t get any better if this stock closes below $19.43. A break above $21.90 however and Iâ€™ll keep an eye on SNAP forming some sort of oddly shaped bullish channel. As youâ€™ll notice, SNAP is down from our original posting; which is really what I wanted and expected anyway. In my book, thatâ€™a win!
SNAP price from the first article: Down $1.91 [8.59%]
3. 3-D Systems Corporation: Ticker DDD ~ Analysis on June 6th, 2017
Well, it seems my friends that DDD just absolutely crushed it recently. The analysis from our 2nd edition couldnâ€™t have been more spot on.
Below is the chart from early May of DDD and my plan for itâ€™s potential wave rotation over earnings that we set up in edition 2.
What a glorious bounce from the inverted head and shoulders. Those who sold puts, bought stock, or bought calls did quite well from that move. And on a non expensive stock, too!
Below is the weekly chart. It appears DDD has sufficiently broken out of the triangle, broken through the really strong resistance at $18.25, and is in the process of retesting as I speak (or type).
By the way, whose voice do you read this article in? Yours? Mine? Someone elseâ€™s voice? My reading voice is George Clooney. HAHA.
Sorry, back to the point at hand.
I do like the put sale approach here. A July $18 or $17 has really good premium!
One could also look to play the bounce with this semi-aggressive directional set up. I feel like less than 1R could be lost on this analysis as well. Target eventually would be the 200 SMA on the weekly, or around $30.
With a similar stock and approach to DDD, we set up the above SSYS put sale a few weeks back, expiring this Friday. Itâ€™s getting pretty close, but we will see what transpires. DDD has been the definition of â€˜lose small, win bigâ€™ as it has essentially carried this portfolio!
DDD price from the first article: Up $6.62 [45.68%]
4. JetBlue Airways: Ticker JBLU ~ Analysis on June 7th, 2017
You know, airlines in general have been trading pretty well over the last few weeks. We had a killer bull put spread a few weeks back on DAL.
Back to the stock at hand. This JBLU chart has almost been to gorgeous to bear. A few traders reaping the benefit of these surging bulls, here recently. This chart goes all the way back to January and has been the basis of our set ups on JBLU in this Spring portfolio.
Our last analysis on JBLU worked out really well too. Below was the predicted bounce off of the 100 SMA on the daily AND weekly.
At this point, JBLU is simply chilling at a resistance. The main question being: is it going to break out? My question is more â€˜whenâ€™, not if.
For those Real Life Traders in shares on JBLU, one path you could consider is the September $27 covered call for .25. Itâ€™s not a lot of premium, but if one had 1,000 shares, thatâ€™s $250. Since the target is $27.06 anyway, might as well get paid to sell at your target, right?
For those not in JBLU, Iâ€™m keeping my eyes on a very nice break out above current resistance. However, watch to play the bounce/retest, since weâ€™ve seen a few times over the last couple of months, the trend is strong, but the buyers who are in like to sell to lock in profits. Direction: Bullish.
JBLU price from the first article: Up $2.10 [10.51%]
5. APPLE Incorporated: Ticker AAPL ~ Analysis on June 7th, 2017
Well my friends, itâ€™s tough to know exactly how to play AAPL from here (on the swing level). This stock makes a frequent appearance on the Weekly Options Newsletter.
In fact, just last week I posted some winning analysis on AAPL. Below is a screen shot of the Weekly Options Newsletter write up and here was the chart from that analysis. We are up about 50% on that trade (as I am writing this now).
Either way, the toughest choice on AAPL for those who own shares long term is â€˜sell, or continue to hold?â€™ I mean, itâ€™s the largest company in the world and it posted 50% stock growth (again) in the last calendar year? Wow.
AAPL is on a tear. As many FIB targets and projections as Iâ€™ve completed on AAPL, along with other traders, a general consensus of $162 keeps popping up. Which is only $7 away, mind you.
The fact remains. AAPL is bullish, buy the dip and hold until it hurts, badly. You can always rebuy later. A longer term â€˜re-buyâ€™ location for me is around the $132, previous all time high area. However, if AAPL breaks out of this pennant pattern pictured below, look to buy the short term retest of it, on the hourly charts and trade it up into a target. I think these $162.50 covered calls will expire worthless, but itâ€™s going to get real close, especially if AAPL breaks out.
AAPL stock price from the first article: Up $11.57 [8%]
Well my family, friends, fans, and followers, thank you so much for reading this write up. It is totally free after all and I release one once a month. Personally I find the information contained incredibly valuable. I mean, from a cumulative numbers stand point, we are looking at approximately a 61% combined increase on these 5 stocks since I first wrote about them at the end of March. So, when I post the next Summer Portfolio, make sure to read it carefully, share it with your friends and continue to LOVE life, live life, and trade it!
Thanks for reading! YOU ROCK!
~ Jerremy Alexander Newsome