Happy Fabulous Friday!
I teach everyday people (like me) to trade options. I do my best to write in an understandable way as if we are talking over the kitchen table.
The market was down 2 out of 5 days last week. I am typing this on Wednesday, and you won’t get this until Friday. A lot can change in a couple days. Always be sure to visit https://www.tradewinsdaily.com/daily-profit-play/ to get these articles early.
For today’s Trade of the Day, we will be looking at Las Vegas Sands Corporation (LVS). Keep reading to see how to use LVS for a quick 94% potential gain.
Las Vegas Sands Corp., together with its subsidiaries, develops, owns, and operates integrated resorts in Asia and the United States. It owns and operates The Venetian Macao Resort Hotel, the Londoner Macao, The Parisian Macao, The Plaza Macao and Four Seasons Hotel Macao, Cotai Strip, and the Sands Macao in Macao, the People’s Republic of China; and Marina Bay Sands in Singapore. The company also owns and operates The Venetian Resort Hotel Casino on the Las Vegas Strip; and the Sands Expo and Convention Center in Las Vegas, Nevada. Its integrated resorts feature accommodations, gaming, entertainment and retail malls, convention and exhibition facilities, celebrity chef restaurants, and other amenities. Las Vegas Sands Corp. was founded in 1988 and is based in Las Vegas, Nevada.
Let’s look at LVS’s weekly chart.
The ADX +DI (green line) is above the -DI and the black ADX line is heading up. As long as the +DI is above the -DI, price should rise. Green above red is an indication of strength. If you want to learn more about ADX, read on or, if not, scroll down to the alert.
The Average Directional Index consists of 3 lines: Green, Red and Black.
Green = +DI (Bullish)
Red = -DI (Bearish)
Black = ADX Strength Line
The DI line that is on top is in control. If the ADX line is heading up, strength is supporting the DI line that is on top and in control.
Each candle on the chart represents price movement over a 5-day (week) period; therefore, it takes weeks for trades to play out. On the chart, the week is a bullish candle as I type. When the +DI crosses over the -DI line, it gives a buy signal for Calls as the +DI line (green) appears as if it is in control and rising to head up on the ADX indicator, and as the ADX turns up that is even more bullish, suggesting an upward move is gaining strength. When the -DI (red line) crosses the green and the black line points up it shows a downward trend and Puts can be considered.
LVS Potential Trade – Showing Strength
This signal could give a quick payout if it continues its upward move, and the strength of this pattern continues. I am typing this on Wednesday and LVS costs about $46. If LVS’s price moves above $47 and the + DI (green line) is above the -DI with the black line heading up you could consider a Call trade. The short-term price target for LVS is $49 and then, perhaps, higher. With the swings in past months, I am suggesting small profit targets until a market trend starts again.
Option trading offers the potential of a lower initial investment and higher percentage gain. Let’s take a look and make a comparison.
It would cost about $46 to buy a share of LVS. If you bought 10 shares it would cost $460. If price went up to the expected $49 you would make a profit of $30 on your 10 shares. That isn’t much of a profit.
If you bought 1 Call option covering 100 shares of LVS with a March 18th expiration date for the 49 strike the premium would be approximately $1.59 today or $159 for 1 option. If price rose to $49 over the next few weeks, the premium would likely increase $1.50 giving $150 profit on your $159 investment, this is a 94% gain.
Trading options is a win, win, win opportunity. Options often offer a smaller overall investment, covering more shares of stock and potential for greater profits.
I like to stress when trading options, you don’t need to wait for the expiration date to close the trade. You can close anywhere along the way prior to the expiration date. It is never a bad idea to take profit.
Trading options is like renting stocks for a fixed period of time. The potential to generate steady income with options is real and it can be transforming. Watch this video to learn how you can use option trading to achieve financial freedom. click here
Yours for a prosperous future,
Past Equity Candidates:
Last Friday we looked at buying AMC Puts. However it never got down below the entry target.