We are at a pivotal moment here in the stock market. I believe that we could be either headed much higher from here or we may see a lot more volatility in this market and I do want to talk about that and exactly what I think the catalysts are to make this market go up, especially going into some huge earnings announcements this week. I'm going to go over each one of those stocks.
You're going to see exactly how to play those stocks very safely, how I'm playing them, and then I'm going to talk about kind of the overall market and what I think. So, let's go ahead and dive into it. As you can see, the portfolio is at 795,000.
And, you know, it's been going pretty well. I do want to give a shout out to my members that participated with me on the leaps call options on Palunteer. And as you can see, I do give away very special leaps ideas opportunities here in the Leaps ideas channel on my trading discord.
As you can see right here, Jason closed out $2,718. Chad closed out $12,180 profit. And Jizlane closed out $1,200 here and Riad closed out $2,800 in profit.
And we were in this trade for five trading days. So up over 40 to 60% on this particular trade. Now, let's talk about the market.
So, where do I think the market is going? Well, what we like to see and analyze is the CME Fedatch tool. Okay, this is one of the things that I analyze when I'm picking direction in the market.
I want to make sure that the stock market is has the fundamentals behind it to head higher. And what we usually see is that when we are in a lowering interest rate environment, meaning the Federal Reserve lowers interest rates, so businesses can borrow at cheaper rates, consumers can borrow at cheaper rates, and there's more liquidity in the markets, right? The market tends to go up.
So, right now, what we're seeing from the CME Fed Watch tool is that there's a we're definitely getting a cut next month. Okay, we're getting an interest rate cut next month. As of this month, there's a 90% chance there will not be a rate cut.
And then we have another one priced in in October and another one priced in probably in December or January of next year. And what has actually changed at is there's a sixth cut being priced in potentially next year in somewhere in you know midsummer to September. Okay.
So six rate cuts are being priced in. That is very bullish for the markets. All right.
When the interest rates comes down, more liquidity pours into the markets, people chase assets, right? So, this is what I like to see. This is the first thing I look at on a weekly basis.
Now, let's check out the overall market. I'm looking here at QQQ or the NASDAQ 100. I like to look at this just to kind of get a, you know, a key uh reading on the markets to see where we are at.
Now, if we're looking at the weekly chart right now, we are making higher lows. So this is bullish structure. This is exactly what we want to see.
We obviously printed the low here on QQQ at 402. That was a few weeks back. We saw the VIX spike up to 60.
And I believe that was a low for the markets. Okay. Now, where we head from here is kind of the big question, right?
So I'm going to change this back to the daily chart. And as you can see, you know, today was kind of an inside day. Didn't really go up much higher.
Didn't really go down much lower. We're just kind of trading inside. And I think what the market is waiting for is a number one is news on tariffs.
We want to see a some sort of deal come in with China and or India. Those are two big things that need to be announced. And when they are announced, if it is neutral and or slightly positive or really positive, the markets are going to rip much higher from here.
Now, if we get bad news, you know, regarding China not wanting to negotiate on tariffs or anything like that, we may be headed down much lower uh potentially to this 445 area. If we do break that, then we might double bottom here um you know at 402 on QQQ. Now, that's not very likely and I'm not playing towards that because earnings are showing a lot of resilience.
Google just had earnings that were positive. Netflix had positive earnings and now this week some of the biggest companies right which is Amazon and Apple also have earnings and if those come in good that basically shows that you know these companies have some resilience even during this high tariff situation inflationary situation right um so we want to see those earnings come in positive if they do I believe that the market will head higher from here now I do want to see QQQ take out this 484 level I was expecting that we were going to go up to that today, but we didn't. So, that's what we want to see this week.
We want to see this 484 level kind of taken out. And if we get above that, then obviously that's a great sign. We're probably headed straight to 500, between 500 and 510 on the NASDAQ.
Now, there I think there may be some resistance there. you know, after earnings potentially we we breach above this to the 490 area and then we kind of come back down for a nice little pullback for an opportunity to grab up more shares, sell some more cash geared puts, maybe even grab some leaps, call options. Okay, so I'm very I'm actually very bullish on the market here.
All right, I am expecting a little pullback. That's why I'm waiting. I'm not allocating all my cash.
But if we look at the VIX, okay, this thing is also trending downwards. This thing is retracing from its all-time high this year, a year yearly high at 60. Okay, we're down at 25 today.
If after earnings, after Amazon earnings, Apple earnings, SoFi earnings, Hood earnings, lots of earnings this week. If this thing could get down to this 21 $20 area, you can expect that this is a healthy bull market and that we are basically on our way back up to all-time highs on QQQ. Okay.
So, that's kind of the area that I'm looking for is really this $20 to $21 area if we could shoot straight in into that area. Obviously, that's best case scenario. Okay.
Um, but what I'm thinking is that we might get a little spike, you know, and then kind of a retracement back into that area maybe at a later time, maybe in May or June, early summer. Okay. So, that's what I'm playing the market for.
And I think that we are headed higher from here. Do I expect a V-shaped recovery on QQQ straight back to all-time highs? No.
But it's definitely not, you know, not off the table. All right. If some amazing news comes out with China, this thing definitely could be a V-shaped recovery.
I just don't think that's going to be highly probable. Okay. Um, but do expect that there is some risk to the upside here.
Seller exhaustion has completely come in, right? Like if you could see the volume, right? Most of the volume up here was all sellers, right?
They had their chance to get out of the markets. And now what we're seeing is just very low volume in the markets and not a lot of sellers. Sellers being met with buyers as you could see today, right?
So that's that's how I'm looking at the markets and that's where I think we're going to be headed going forward. So I am very bullish on the market and I think this is a great opportunity to pick up some of the stocks that I'm about to cover right now. But before we do that, if you do want to make six figures, multi6 figures trading options, and you want my direct help, you want access to my mastermind of 65 highlevel investors, click that first link down below in the description.
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And also my free newsletter, which are both down below. But let's go ahead and talk about the first stock. Okay, this stock, SoFi, has earnings tomorrow.
SoFi is an online banking company, very good fundamentals, great PE ratio, and this is a company that's currently at a discount that I believe is going much higher. Now, let's talk about it. Okay, uh market cap on this company is 14 billion.
So, it is considered a very small company. Um if you look at their gross margins last quarter, 32%, right? Some of the highest in the industry.
And I do believe that this will be the next Wells Fargo or JP Morgan Chase. So, I do think that this company can easily get to over a hundred billion market cap, and that's what I'm playing it for. Okay.
PE ratio right now is 32. So, not too far out of line. Obviously, it's higher than most traditional banking stocks, but this company is an online banking stock and it also is an AI banking stock where they utilize a lot of AI technology in their company to help customers, right?
And I do see this company going much higher from here. So, let's take a look at the chart. We had an all-time high of 1843 back on January 24th of this year.
And right now, the stock is trading significantly lower. So, let's look at where the stock was compared to now. So, we're at a 27 28% discount today on the stock from all-time highs.
And I do believe that this stock will go well past $18. 40. So, right now is a great time to start selling some cash secured puts.
Or if you don't have enough money to have collateral to sell a cash secured put, you're going to need at least a,000 bucks per contract, then you could buy some shares. Okay, this is why this stock is nice as well. It's a lower price stock, meaning the share price is lower.
um and it allows you know newer investors to kind of get into it or people that don't want to go too heavy to kind of sell some cash geared puts and get um used to that. So we are at the higher end of the upper Ballinger band. That's why this stock is not uh going to be a good leaps call option opportunity.
Okay, it's already made quite a runup from the bottom. If we take a look at how far it's gone up, it's gone about 54%. Okay, so right now is not a good leaps call option opportunity.
In fact, all the stocks that I'm going to be covering are going to be better for just buying the shares outright or doing a cash secured put if you have money for that collateral. So, let's go ahead and talk about it. We're going to go into my account right here.
I have a big position on SoFi. I have, you know, 25 cash secured puts that I just um rolled up to the 12 strike from the 10 strike. So, I have 25 of these paying me $1600 in 25 days.
Okay. Now, let's go to the options chain and select a strike that I believe would be very substantial as far as ROI goes. So, we're going to go to May 23rd.
The reason I'm not going out to May 30th is because there's higher implied volatility here on the May 23rd option. Okay, we want to take advantage advantage of rich premiums. Meaning, the higher the implied volatility, the more expensive the put options are and the more premium we can collect.
So, we're going to go here. And what I would do just to play it super safe, like if you want a super safe trade that I'm, you know, I'm in the twelves, but you can go to the 11 12s and collect 50 bucks. Let's do the math there.
So $50 divided by 11. 5. That's about a 4.
3% return annualized. That's about a 52% return. So you're beating the market by 5x.
So I think this is a very safe play. 25 delta, which means it has a 25% chance of you getting assigned the shares. If you got assigned the shares, you would have to pay 11,500 bucks, right?
Uh for those shares, and you'd have 100 shares that you could then sell covered calls on to collect income. So, I do love this trade right here. Very safe 25 delta.
And if we look at the chart, okay, that's going to get you all the way down here as far as a discount. If the stock did have bad earnings for say for instance, right, you're it's going to come all the way down. Let's just say it comes all the way down here, breaches your strike price.
Okay, you get a sign, but you got a fat discount, right? And we'll calculate the discount. You're getting about a 13% discount from where the stock is trading right now.
So, I like that trade. A good setup. And I do believe the stock is headed much higher from here.
So, most likely you'll just be collecting income and not have to worry about getting assigned. So, that's the first stock. Now let's talk about my next favorite stock which is Robin Hood.
Amazing company again last quarter amazing margins uh net margins. So if you look at their profit margin 90% okay this company is not being affected by the tariffs. The um the last company we talked about not being affected by the tariffs.
Okay. So, these are also companies that kind of give you some diversification outside of the tariffs just in case these tariffs stay here for longer. Okay.
Um, so yeah, amazing net margins, PE ratio 30, which is right in line with, you know, it's an a brokerage stock, an online banking stock. Like there there's so many things that you could classify Robin Hood as because they have many services for their customers. Okay.
So, I really like this stock. Their earnings come in in two days. All right.
And we're going to look at the charts and then I'm going to give you a safe cash secured put trade. All right. So, this stock has had quite a run.
Okay. So, right now, not a good time to buy LEAPS options, you know, for earnings because it's kind of a 50/50 bet. We're at the upper Ballinger band.
Not really good there because in case they do have maybe sub uh subpar earnings and this thing comes down to, I don't know, 40, right? You don't want to be stuck in those leaps options. So, right now would be a cash secured put play or just buying the stock outright um and riding this thing up for the long term.
Okay. Uh which from all-time highs, we're down about 24%. So, still significant discount on the stock.
Uh but it has had quite a substantial run up from the bottom here about 70% up. Okay. And we've been riding LEAPS leaps call options on this thing, you know, three or four times already, profiting on the way up.
So, I'll wait for a pullback. you know, if you do want a pullback entry, you know, I'm eyeing this 43 area if we get back down to there for sure. I'm going to be buying some LEAPS again, okay?
And that will be in my group as well that I'll be kind of shouting out live in there. But yeah, so this stock very, very good. Massive discount, lots of bullish momentum.
And if we look at, let's go to um my position, you're going to see that I have 700 shares that are about to be called away in 11 days at 47 most likely. And I do have about 28 42 strike put options. Okay, so you know, I went pretty heavy on this stock.
117,000 in collateral. Um but to collect about, you know, $5600 in income in 25 days. So over $5,000 in income.
I remember there was a point in time where I didn't even make 5,000 a month. And I'm doing this from hood put options. So what I would do is go to Robin Hood, the options chain.
And again, you want a little bit higher implied volatility. So you can go out 25 days. I'm going to go out to the May 23rd.
And if you want to be safe, you grab the, you know, if you want to be super safe, you grab the 20 deltas. I would go for the 25 deltas right now, which is about one strike higher than where I currently am. So the 43s, let's do the math on that.
So you'd collect 195 divided by 43, that's about a 4. 5% return. So massive return there, even higher than the SoFi 25 delta, right?
And annualized that's 54%. So great return, super safe. 43.
You know, if the stock for some reason does come down to 43, um, you're getting quite a discount on the stock. You're basically getting down to right here, which if we calculate the discount from where the stock is currently trading. All right, that's about an 11.
3% discount. Okay, so great strike price. I don't believe those are going to be in the money.
I do believe that Hood is probably going to be heading higher maybe to 52 to 55, somewhere in that range. Not too crazy, but you know, it will be it most likely will be headed higher, especially on good earnings. All right, so Robin Hood, another stock that I'd be adding to the portfolio for diversification, kind of getting out of that mag seven.
The MAG 7 has been very beat up. Obviously, the biggest names in the uh in the stock market. That's where all the international investors go to.
That's where most, you know, 401k holders are going to. They're going to the MAG 7 because they're safe, predictable, and have a lot of cash flow. but those have been hit the hardest.
So, let's go ahead and transition into two Mag 7 stocks that are reporting earnings this week. So, the first one's Apple. All right, love Apple.
Safest stock to own um you know, by far just historically. Okay, this is this is a stock that I would buy for my parents, right? And I have bought for my parents and this is a very safe stock.
Okay, so in 3 days they report $3 trillion market cap. PE ratio is 33, which is definitely a little bit higher for Apple, but um more of a discount as of right now. And you know, the company has tons of cash on hand.
Net margins are pretty high. Of course, they are being affected by the Chinese tariffs. Um but there you know Apple just announced that they are kind of diversifying and manufacturing in India which I knew was going to be a huge play and I think that India is going to be probably a huge manufacturer for the US going forward.
Um you know we made one country rich and now kind of switching to another and I think that is a great diversification for Apple. So I like that going forward. Makes me feel safe holding this stock and this stock has had quite a runup from the bottom.
Okay. So definitely one of the stronger of the MAG 7 and I believe that you know we saw the bottoms. So it's had a 25% runup and then from all-time highs right from all-time highs we are down about 18 19%.
So you're still seeing a massive discount on this stock. So, this is a stock that I'd definitely be adding to the portfolio here. I definitely get a little bit more aggressive on this stock because it's safer and I do see a lot of upside for Apple.
So, let's go ahead and talk about it. What do I think? Where do I think this stock is going?
I do think it'll probably be headed on good earnings, maybe up to 220, which would be a kind of a good level. And we could kind of take a look at my portfolio. I have the 210s, which just right now um got out of the money.
So, they were in the money earlier today. And I have the 190s. Okay.
So, I have four cash secured puts here, $80,000 in collateral. And if I were to sell an option on it today going into earnings, I'd probably go out again May, you know, May 23rd, 25 days out. And I'd just go to the 30 delta.
I'd just be a little bit more aggressive on Apple because the premiums aren't as high. Um, and I do like the stock at 200. So, I'd do the 200s and we'd be collecting 390 bucks divided by 200.
It's about a 1. 95% return in 25 days. So, not bad.
Almost 2% in 25 days on a blue chip company. And if you did get assigned at 200, hey, great discount catching it near the bottoms. And, uh, I really like this stock.
So, um, I do see Apple having positive earnings as well or kind of in line with expectations, but nothing blowout. no blowout earnings on Apple just because of tariffs. The tariff situation obviously 10% of their customers are in China and you know they they are these earnings are going to be affected by that a little but I don't think they're going to miss earnings by any means.
Okay, so let's go ahead and go into the last stock which is Amazon. This one I think long-term is a major player in the AI space that people are really underlooking. Okay, people aren't really counting this in with the AI space.
They are getting into the robo taxi situation. They having their own company. Um, they are getting into the AI robots, robotics, and I think that Amazon is a huge quiet player right now that should not be overlooked.
So earnings are in three days. PE ratio is 33 which is kind of right in line with Apple and you know great margins lots of cash on the table and yeah I like Amazon. I like Amazon here.
If we look at the chart massive discount okay and we have seen it break this long-term downtrend here. It kind of broke this uh last Friday. Okay.
So right now we're looking at a a key kind of conjecture area that if we continue to head higher here from you know on Amazon stock chart I think that this thing kind of recovers goes back to 215 220 uh in the next month or two. All right so I'm really liking it here. Um if I were to place a trade on Amazon I'm fully allocated to Amazon.
have about 400 shares and three leaps call options that are deep underwater because I got assigned you know at a much higher price and yeah I this was kind of the first stock that I was going after during this crash so obviously it's the worst performer in the portfolio but long-term love it okay and I think we're going much higher than 225 where I was assigned so if we go into the options chain I would go on this one I would just go go ahead and go out 30 days okay 32 days to collect some premium Give yourself some time to be right. All right. What I would do is go to the 30 delta or the 27 delta, which is the 175 strike.
Let's calculate the return on that. So 415 divided by 175. That's going to be a 2.
37% return. So we're getting more bang for our buck here on the Amazon options versus the Apple. And I do like this play a little bit better.
Okay. Um we can take a look at the charts and see how far down 175 is. So yeah, you're getting, yeah, a pretty steep discount here um from where the stock is currently trading.
If we take a look at that, that's going to be about uh you know, 6% discount from here if you did get assigned the stock and you'd be literally catching near the bottoms. Um but from the top, I mean, the stock is still at a 21% discount. So I like the discount better here as far as a MAG7 options play.
Okay, so Amazon definitely one to add to the portfolio. Now, if you enjoyed this update video, make sure to give it a thumbs up. That helps this video in the algorithm.
And I look forward to seeing you in the next one. I'm going to link another video right here you can check out on the wheel strategy on one of my favorite stocks. Take a look at that one and I'll see you in the next one.
Take care.
