As we enter the fourth week of earnings we’ve been averaging only one trade per week. No biggie. We should still see our average of 8-12 trades by the end of the season and with a few key opportunities next week I hope to make at least two, potentially three trades. Of course, Mr. Market will truly decide whether or not we are able to place more than one or two trades next week.

The recent rally in the market has helped all our positions. If this keeps up, we should reap quite a bit of premium for the August expiration cycle.

We added JPM to our shorter-term Income Trades Portfolio and plan to add several more as we progress through earnings season. My intent is to add at least two to three more to that portfolio by the end of next week as the opportunities are plentiful currently. As I’ve stated in the past, the goal is to ladder our shorter-term trades, so we have trades expiring on a weekly basis. Of course, we are in the beginning stages of the service, with a challenging market, so I will remain patient in my selection. If Mr. Market cooperates, stay tuned for several trade alerts as we move through next week.

We locked in another gain this week, marking our fifth straight winner since starting the Quant Trader service. Our cumulative total is 56.26%, for an average winner of 11.25%. The gains have been on the smaller side, but given the volatility we’ve seen in this market, I’ve chosen to take winners off the table when we can lock in 50% to 75% of the original premium sold. In some cases, I might let a few winners run a little longer, but not in this market. There is no need to press. And when you think the market has lost 2.6% over the same time frame, well, I think we’ve done okay for ourselves.

The market’s slow, steady improvement continues, with our Cabot Tides turning positive last week and some more stocks starting to shape up. That said, we still think it’s best to go slow here, partially due to more time being needed for setups to emerge, and partly because so many names we’re watching actually report earnings in the next week or two; the reactions will go a long way toward telling us if this rally has legs. Right now, we’re cautiously optimistic--we have no more buys tonight but could in the days ahead if things go well.



In tonight’s issue, we write about our new additions, review some other top ideas (including one that’s shown repeated huge-volume buying over the past many months) and remind you that the market is very capable of getting going despite the bad economy.

This week’s GDP number should confirm that we are in a recession. That might be good news for the market.
The worst situation for stocks tends to be a “looming recession”. Stocks tend to fall most as a recession approaches and in the early phases of an actual recession. Stocks also tend to recover before the economy because the market anticipates six to nine months into future. In a typical recession, stocks fall before it hits and recover before it’s over.


If this week’s number confirms that we are in a recession that began at the beginning of the year, the market should be in a more desirable position than if a recession is anticipated later this year or early next year.<.p>


The recent rally in technology is encouraging. I mentioned in last month’s issue that technology stocks had fallen before the overall market and were likely to recover before most other sectors. Since then, portfolio position Qualcomm (QCOM) is up nearly 30%.


This month’s issue highlights another technology stock, Intel (INTC) . The stock is still very cheap with bright prospects in the future. If the market turns south again, the stock should hold up better than the technology sector and be a solid longer-term hold. But if this rally in technology proves to be lasting and QCOM gets called away, we will still have another tech stock that should move higher as well and provide a great call writing opportunity.

In recent months I’ve been telling you that cannabis stocks were incredibly cheap and overdue for a bounce and now it seems the world is starting to agree, as all our cannabis operators (not the REIT) have seen their stocks climb in the past month.

Of course, the broad market’s rebound has helped, but the broad market doesn’t have the compelling fundamentals of the cannabis industry’s top stocks.



Bottom line: the first six months of 2022 were rough. The past month brought us a small gain. And I expect far bigger gains over the remainder of the year.



Full details in the issue.



Yours for wealth and wisdom.

The precious metals remain near their yearly lows, but a window of opportunity still beckons. Specifically, recent commercial hedging activity points to a possible bottom ahead for the metals.

Elsewhere, titanium remains one of today’s strongest metals. Other industrial metals, meanwhile, are coming off major lows but have rebound potential.



In the trading portfolio, I’m adding a potential short-covering trade for a palladium ETF. Details inside.

This week we are going to make a play on Qualcomm (QCOM), which is due to report earnings on Wednesday. And while there is risk in executing a trade ahead of earnings, we are going to play it conservatively by selling an in-the-money call.

For the first time in months, stocks actually have a bit of momentum. Is it sustainable? Or another false start? Too early to tell. But it’s a good time to keep adding beaten-down names that are finally showing signs of life. This week’s new recommendation fits the bill, and has been a big winner for Carl Delfeld since he added it to his Cabot Explorer portfolio earlier this month.

Details inside.

The big event last week for the market was that, by our measures, the intermediate-term trend of the major indexes and many growth funds turned up, which is enough for us to extend our line a bit—but, at this time, just a bit, as there remain many headwinds, including the longer-term trend and (very important) the lack of upside breakouts quite yet. That tells us to go slow and keep our eyes peeled for further upside confirmation—if we see that, we’ll continue to put more money to work in fresh leaders, but should the nascent rally hit a wall, we’ll hold off. For now, we’ve nudged our Market Monitor up to a level 4 and will take it day by day from here.


This week’s list has a bunch of names that have shown solid power of late, though most do report earnings within the next two or three weeks, so be sure to keep things small and aim for dips.. Our Top Pick is an innovative software firm whose stock is actually tightening up after a good-looking bottoming process.

There really isn’t too much to say at the moment. Our positions keep chugging along and while they are all still in a healthy position the margins of error, particularly to the upside on our SPY and IWM iron condors, have narrowed a bit. No worries, we will make adjustments if necessary, but for now the probabilities on all our trades remain in reasonable territory.

As for next week, well, due to the rally over the past week, we are seeing numerous ETFs hit a short-term overbought extreme. We don’t want to react too quickly, but if we see a continuation of the current trend higher, I think a trade or two will be in the cards as we want to take advantage of ETFs in a short-term overbought extreme. SMH is already there, but I would like to see a few others join the group before taking on another position.

Earnings season is finally in full swing next week with an abundance of high-quality, blue-chip companies due to announce.

Microsoft (MSFT), Visa (V), Mastercard (MA), and Apple (AAPL) are just a few of the names I’ll be focusing on. As you can see in “The Week Ahead” section below there are more than 15 stocks that I’ll be watching closely next week with the intent of making at least two, three, if not four trades.

This week, ten companies reported earnings, with Berkshire Hathaway (BRK.B) reporting tomorrow (Saturday): Barrick Gold (GOLD), Conduent (CNDT), Gannett (GCI), GCP Applied Technologies (GCP), General Motors (GM), Jeld-Wen Holdings (JELD), LaFargeHolcim (HCMLY), Meredith Corporation (MDP), Mosaic (MOS), and ViacomCBS (VIAC).

After an insane couple of weeks this one has felt relatively calm. There is still plenty of market-moving news around the election, vaccines, the pandemic’s frightening trajectory, etc. but I think we’ve all become somewhat accustomed enough to alarming headlines – within a certain range – that it’s harder to get shaken now than in the past.

Markets steadied this week as the political situation became clearer and prospects for Covid-19 vaccines becoming available in the first half of 2021 seem more promising. The Explorer portfolio performed well this week, with a couple of ideas breaking out to new highs.

The economy is already rebounding, and at a stronger pace than was expected. But it still has one arm tied behind its back with the remaining restrictions and lockdowns. Plus, with the indexes not far from all time highs, the market had likely risen as much as it was going to before the next phase of the recovery came into view.

This year continues to amaze. The market had another big rally this week on news of very positive late-stage trial results for a coronavirus vaccine from pharmaceutical company Moderna (MRNA). The S&P 500 soared to a new all-time high, the first since early September.

This was a busy week, with many of our companies reporting earnings.

While pulling back a bit from the sharp jump on Monday, November 9th, the market rebounded on additional encouraging Covid vaccine results this week.

This week only four companies reported earnings. As your chief analyst is traveling this week, there is no podcast.

Stay cautious for now as we wait to see whether growth stocks can find their footing (which they’ve done for a couple days in a row now).

The market is working its way through significant developments on many fronts – U.S. presidential race, raging pandemic, positive vaccine developments – and information overload is causing some intense action in individual stocks.

The economy is already rebounding, and at a stronger pace than was expected. But it still has one arm tied behind its back with the remaining restrictions and lockdowns. Plus, with the indexes not far from all time highs, the market had likely risen as much as it was going to before the next phase of the recovery came into view.

Just like that, the stock market emerged from its dark mood of October 30th to surge 8.6% in six trading days, with reinvigorated optimism following the evaporation of the election cloud and news of a very promising Covid vaccine.

Growth stocks have taken a beating so far this week as a sharp rotation is underway. Given that the Model Portfolio was 41% cash coming into this week, we’re not craving more cash, but we are making one small move tonight

We have four earnings reports from last night to get to today (ARNA, APPF, RPAY, SPT). Right now, I’m getting the first two out and will follow up with the other two shortly.

The market continues to react to the good news on the vaccine front, but growth stocks continue to suffer. Today we’re taking another incremental step to wind down some of our exposure.

This mega-tech company is preparing to spin-off a subdivision.

Bruce is selling three portfolio stocks.

We are getting closer to clearing two of the biggest hurdles of uncertainty out there. I am, of course, talking about the U.S. presidential election and the Pfizer and BioNTech vaccine news.

The U.S. and the world has cleared two of the biggest hurdles of uncertainty out there. I am, of course, talking about the U.S. presidential election and the Pfizer and BioNTech vaccine news.

We are moving Peabody Energy (BTU) and Weyerhaueser (WY) to Sell.

We are moving Barrick Gold (GOLD) to Sell.

This building products company posted earnings of $1.04 per share last quarter, compared to analysts’ estimates of $0.78.

Three of our portfolio stocks report earnings.

Three analysts have increased their EPS estimates for this pest control company in the past 30 days; they now forecast growth of 47.1% for the company next year.

A few Cabot Options Trader subscribers have asked me about ways to protect gains in their portfolios, so I thought I would write to everyone with a couple of strategies using options to hedge your portfolio.

A subscriber recently asked me if I keep a journal of my trades. Many traders keep journals so they can look back at their trades and evaluate what they did right and what they did wrong.

Want to know how the big institutional investors use options? Here is an example of how one trader spent $132 million on three technology stocks.

Options trading has its own vernacular. To know how to do it, you need to know what every options term means. Here are some of the basics.

Our Cabot Top Ten Trader’s market timing system consists of two parts—one based on the action of three select, growth-oriented market indexes, and the other based on the action of the fast-moving stocks Cabot Top Ten features.