For 39 trading days… I’ve been following some of the top options traders on Wall Street… sniffing out their best trade setups…
So far, I’ve taken 51 trades and achieved an 80% win rate… and many of these trades have returned 50% plus… heck, some have even returned more than 100%…
Before I tell you about my three trade setups… I want to give you some of the key details behind Dollar Ace and why it’s such a groundbreaking trading system — and provide you with a brief recap of my 1 hour and 15 minutes long Dollar Ace event today.
So how does this strategy work?
It’s actually really simple and requires just three steps:
- Spot the unusual options activity. (Don’t worry about that, I’ve got you covered with that because I use a special scanner and alert you about the best setups I see in the market.)
- Follow these massive options trades.
- Take profits
On Friday, my Dollar Ace scanner picked up some unusual options activity (UOA) in FireEye (FEYE).
About a week prior to that, there was UOA in the FEYE calls, and then buyout rumors swarmed… so this name was on my radar already.
Additionally, there have been rumors that the company hired Goldman Sachs for a potential sale.
Source: Business Insider
That day, 7,000 calls went off in the $16 strike price call options expiring November 1.
That meant the options trader who bought those calls was controlling 700,000 shares… and spent more than $100K on the trade — I don’t know about you, but if someone is throwing down such a massive bet on a “long shot” trade, I’m following them because they must know something.
There were a few things going for the stock from a technical standpoint. Take a look at the daily chart in FEYE below.
With the options activity and the chart setup… I couldn’t pass the trade up.
Well, first, FEYE formed a bull flag — one of my favorite setups to use because that actually improves the chances of my success. Basically, if there’s bullish options activity, as well as a strong chart pattern… chances are the stock will break out, and I take profits.
Not only that, but there was a massive gap above… and $16 is the gap-fill area.
With unusual options activity, I’ve used the strategy enough to know that there aren’t coincidences. The options trader bought those $16 options for a reason.
What do you think happened yesterday?
The stock gapped up…
… and guess what those options were doing…
Heck, the stock a high of $15.80 today!
I could’ve made more… but I’m not complaining about an 80% profit over the weekend.
The key takeaway here is that the Wall Street insiders are in the know… and they have an edge we can directly profit from.
I know you’ve been waiting for the alerts… the first alert I gave out was call options in ZAGG, and you can hear me talk about the details behind the UOA in the stock below, as well as the other two alerts I dimed out earlier today.
If you want to get in on my latest trade alerts and take advantage of some of Wall Street’s top options traders… you’ll want to join in on the action now because there could be a slew of trade alerts coming out this week.
[Ed.note: Kyle Dennis runs BiotechBreakouts.com. He is an event-based trader, who prefers low-priced and small-cap biotech stocks.
Source: BiotechBreakouts.com | Original Link