The market seemed ready to collapse, but once again, the market appears to be recovering as semiconductor stock buying returned on Tuesday.

In uncertain times like these, I continue to look at what can be predictable, and having a filtered list of opportunities is always a great first step!  With the Stock Forecast Toolbox, the ideas keep coming and they keep working very well.  If you aren’t sure, I get it, but to help illustrate its power, you can try it out for free!

When I look at this market, I just don’t see enough predictability in the semiconductor sector.  It may have bottomed out, but this may be a spot where it’s a one-day rally followed by more downside.

So, I looked at several stocks and avoided those with earnings coming in the next 2 weeks, and I found something particularly interesting.  Right now, there are a handful of retail stocks that are showing some very exciting potential upside, for example Ross Stores (ROST):

This is a stock that’s trading at 6-month highs, and while it may pull back, there’s also potential for a technical breakout that creates significant upside.  With the likelihood of upside being a little bit less certain due to overhead resistance at or near current prices, I need some extra due diligence, and there’s where the Toolbox kicks in for me:

With upside projected to $255 in the next 2 weeks, the August 14th $240/$255 call spread looks like an interesting trade.  By utilizing weekly options, I can choose an expiration date prior to their corporate earnings, and that’s generally a smart approach to avoid paying additional option premium.  The call spread is trading for about $3.85 at this time, and a rally to $255 in the next 2 weeks could set up a massive return, with the maximum value of that spread being $15.00.  Combining these exciting technical setups with the extra confidence of the Forecast Toolbox and the leverage of options is one of the best ways I’ve found to consistently generate great trade ideas.  And you can, too!

As a reminder, the Forecast Toolbox doesn’t just give me one prediction every week or every day.  It models out high probability moves for most listed stocks in the market.  I can check every stock in my portfolio to make sure I’m positioned right when I’m holding my investments, and when I’m looking for a new trade, it provides a filtered list of some of the most explosive setups so I can find the next great idea for my trading portfolio.

So, make sure to take advantage of the free 7-Day Trial of the Stock Forecast Toolbox so you can see what it can do for you!

If you have any questions, never hesitate to reach out.

Keith Harwood

Keith@OptionHotline.com