I believe the good news will prevail in 2024. But you never know. Forget about trying to predict the direction of the overall market. However, certain aspects of the current environment and established trends are much more bankable.

For example, it is highly likely that interest rates have peaked. Sure, rates could bounce higher than they are now. But that 5% peak level on the 10-year Treasury is unlikely to be eclipsed, at least in this cycle. Artificial intelligence is here to stay. Businesses must spend on it not only for competitive advantage but as a matter of survival. The new technology will continue to be a strong growth catalyst for technology stocks.

In this issue, I highlight a fantastic dividend stock whose long record of strong performance has been interrupted these last two years because of rising interest rates. It’s also a company that focuses on technology and will surely benefit from the proliferation of AI in the years ahead. The timing for this stock should be outstanding.

The vast majority of our work is based on the trends of the major indexes and the action of leading stocks, and on those two fronts, things look very good; we’ve even seen the broad market perk up after a tough stretch, too, which helps the cause. About the only thing to worry about here is that ... there’s not much to worry about, and that many leading stocks are showing some near-term exhaustion patterns. Big picture, we’re moving our Market Monitor back to a level 8, but you should still keep your feet on the ground, looking for decent entry points in strong stocks.

This week’s list has a lot of stocks that not only have excellent overall charts but have either consolidated calmly for the past few weeks—or have shown outstanding buying volume in recent days. Our Top Pick is one of the latter, gapping up to new highs last week on earnings.

After a sluggish start to the year, stocks have broken to new highs, with not even diminished expectations of Fed rate cuts able to slow them. Is it the next leg up in this still-nascent bull market? Perhaps. But in case there’s some earnings season turbulence ahead, today we add a low-risk value stock that’s been a favorite of Cabot Value Investor Chief Analyst Bruce Kaser for quite some time.

Details inside.

We locked in three more profitable trades at expiration last Friday, bringing our total positive trades total for the January 19, 2024 expiration cycle to five. Our total returns so far in January are 10.86% with the potential for a return in PFE that would certainly add a few percentage points to our overall returns for the month.

As stated above, we have one position, PFE, that is due to expire this week. As it stands, our position is currently sitting at-the-money, but it doesn’t really matter where it closes at expiration this Friday as we will continue to follow the guidelines for our income wheel strategy.

As we discussed on our subscriber-only call last week, this begins a four- to five-week period of major earnings announcements. More importantly, this week offers us several potential opportunities to trade a few earnings announcements.

Per our discussion last Friday, Visa (V), IBM (IBM) and American Express (AXP) offer the best opportunities with United Rentals (URI) not far behind. Surprisingly, Microsoft (MSFT) and Texas Instruments (TXN) didn’t offer any decent opportunities, or at least that was the case when we took a look Friday. But who knows, maybe implied volatility will kick up a bit higher before earnings and offer some better opportunities to sell premium.

We added an iron condor last week and hope to add a few more trades this week, including a bear call spread and a bull put spread. I’ll be focusing on sector ETFs and individual stocks as the major indices continue to see low levels of volatility.

We’ve seen an incredible rally since October 27, 2023. SPY was trading for roughly 411 at the time and at the close of the January 19, 2024, expiration cycle the market-leading ETF was trading for 482.43.

Despite some weakness early in the week, the indexes bounced back in a big way, closing at new all-time highs. For the week the S&P 500 gained 1%, the Dow added 1.07%, and the Nasdaq soared higher by 2%.

Despite some weakness early in the week, the indexes bounced back in a big way, closing at new all-time highs. For the week the S&P 500 gained 1%, the Dow added 1.07%, and the Nasdaq soared higher by 2%.

While every situation is different, a pretty good rule of thumb for investors is to look for stocks of well-run companies with solid fundamentals in a sector that has been out of favor. Then check that the stock is in an uptrend with clear catalysts that support a further rise in its stock price.

Today, we add a stock that checks all those boxes.

In the January issue of Cabot Early Opportunities, we take a look at updates within our portfolio then dive into five stocks from markets ranging from defense to cybersecurity to the blooming IT infrastructure market.

As always, there’s something for everybody!

The three leading indexes again made a run at new highs last week as the S&P 500 gained 1.75%, the Dow rallied 0.7% and the Nasdaq added 2.88%.

After a sour first week of the year, leading stocks snapped back very nicely last week, and when you add in the other encouraging intermediate-term vibes (trends of the indexes and most sectors are up), we remain bullish overall. That said, we’re also keeping our feet on the ground: The current advance is now about two and a half months old, earnings season is here and the broad market was a notable laggard last week, all of which means further volatility and crosscurrents are possible, even likely. We’ll leave our Market Monitor at a level 7.

This week’s list is another where’s there’s something for everyone. Our Top Pick is one of many medical-related stocks that’s showing strength thanks to a new product, great Q4 guidance and expectations of accelerating growth this year.

This week, I want to use my introduction to spend some time diving into Liberated Syndication (LSYN) because I spoke to the CEO, Brad Tirpak, for about an hour last week.


To review, Liberated Syndication stopped trading publicly in late 2021 because it was so behind on its historical financials, that FINRA/SEC revoked its ability to trade. So since late 2021, the stock has been private.

This week, we comment on earnings from Conduent (CNDT), Ironwood Pharmaceuticals (IRWD), Organon (OGN), Toshiba (TOSYY) and TreeHouse Foods (THS).

Cabot Options Institute Quant Trader is focused exclusively on creating consistent returns using high-probability options strategies including bear call spreads, bull put spreads, iron condors and more. Whether you have questions about the strategies, or even about setting up your account, or how to make your own trades, Andy will answer all of your questions

WHAT TO DO NOW: Continue to lean bullish. The market has chopped around for the past couple of weeks, but while we’re always on the lookout for yellow flags, none have appeared yet—all of our key market timing indicators are positive and most stocks are doing pretty well. We’re not close to fully bullish, but we’ll put a bit more money to work tonight by filling out our position in Uber (UBER), which will leave us with around 35% in cash. We’re also going to place Shift4 (FOUR) on Hold after today’s selling. Details below.

The market has continued to hold up surprisingly well in the face of less-than-great inflation reports.

We’re in a period where it appears the pros of slightly stronger economic growth outweigh the cons of a slower-than-desired inflation retreat. Earnings season is helping to return focus to company specifics, for the time being.

Our earnings season really heats up next week as we should have at least six positions report. It’s going to be an intense week, so buckle up!

Retail sales rose 3% in January, the Census Bureau said yesterday, reversing November and December’s declines. Manufacturing output increased by 1%, following a steep 1.8% decline in December. Positive but slow growth right now might be just what we need to avoid more interest rate increases by the Fed.

Cabot Options Institute Income Trader is focused exclusively on the creating consistent income through a variety of options selling strategies. Whether you have questions about selling puts, covered strangles, jade lizards or our income wheel approach, Andy is more than happy to help you steepen your learning curve in this live event.

January inflation came out. It wasn’t good. Is this rally doomed?

It has been a good year so far in the market. The S&P 500 is up about 8% and the Nasdaq has rallied more than 13% in just the first six weeks of this year. Stocks have been lifted by optimism of a soft landing.

For the first time that I can remember, I didn’t watch the Super Bowl. We had been skiing all weekend in New Hampshire, and I was EXHAUSTED. I think our entire household was asleep by 8 p.m. It sounded like an incredible game, but I’m not upset I missed it. An amazing night of sleep was worth it. Maybe that means I’m getting old?

A few weeks ago, we introduced the Gartner Hype Cycle, which traces the path that all tech companies follow in what essentially is an immutable law of tech investing. Currently, tech stocks have passed the Peak of Inflated Expectations and are sliding down to the Trough of Disillusionment. A few will ascend back to prosperity along the “Slope of Enlightenment” if they maintain both their relevance and their competitive edge. But most will lose one or both of these traits and thus continue downward in what could be labeled the “Decline into Oblivion.”

I will be exiting the Home Depot (HD) trade today. I will discuss the trade in greater detail in our upcoming subscriber-exclusive webinar, at noon ET this Friday.

The market is pulling in today, though given the rally last week, the action among the indexes is still normal. On the market timing front, the Cabot Tides green light is still in effect, though our Cabot Trend Lines remain bearish, as does our Aggression Index. The Two-Second Indicator did record “only” 35 new lows on Friday, so we’ll see if that continues.

As discussed in our weekly issue last week, and on our weekly call, I will be taking a position in Walmart (WMT) today.

Election results set up some key potential catalysts for our cannabis stocks, both near term and further down the road.


Above all, a Republican takeover of control of the House of Representatives increases the odds that we will see very near-term passage of favorable banking reform, known as the Secure and Fair Enforcement Act, or SAFE Banking Act.

This morning’s “less bad” CPI report (what a difference 0.2% makes!) is just what the market needed to get off its knees.

Given that we are in profitable territory with 16 days left until November expiration, I’ve decided to take off all exposure and reestablish trades for December expiration after the Fed event today.

We currently own the TLT January 19, 2024, 85 call LEAPS contract at $29.10. You must own LEAPS in order to use this strategy.

Montauk Renewables (MNTK) reported third-quarter earnings after the bell on Wednesday and they weren’t good – at least not compared to estimates.

Treace Medical (TMCI) delivered a Q3 beat after the bell yesterday with revenue of $33.1 million (+53%) beating estimates by $3.03 million and EPS of -$0.22 beating by $0.07.

I will be exiting the Disney (DIS) trade today. I will discuss the trade in greater detail in our subscriber-exclusive webinar at noon ET Friday, November 11.

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.