Trade Alert – (SPY) January 23, 2013

As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. This is your chance to ‘look over’ John Thomas’ shoulder as he gives you unparalleled insight on major world financial trends BEFORE they happen.

Trade Alert – (SPY)

Buy the SPDR S&P 500 SPY March, 2013 $140-$145 call spread at $4.33 or best

Opening Trade

1-23-2012

expiration date: 3-15-2012

Portfolio weighting: 10%

Number of Contracts = ($10,000/100/$4.33) = 22 contracts

OK, I’m going out on a limb a bit here. I think that Apple (AAPL) earnings will do better than expected, or at the very least, disappoint less than expected. That will cause the stock to pop tomorrow, and take the rest of the market with it. That will be enough juice to take the S&P 500 over 1,500, a new five year high.

We are clearly gunning for 1,550-1,600 by March. With the SPDR S&P 500 (SPY) March, 2013 $140-$145 call spread, the market would have to go back to its January 2 range for us to lose money. There is not way that is going to happen until the summer.

I don’t want to trade in Apple directly because I have just been burned too many times. It is too volatile for most readers to follow now.

Here are the trades you need to execute:

Buy 22 March, 2013 (SPY) $140 calls at……………$9.87
Sell Short 22 March, 2013 (SPY) $145 calls at …….$5.54
Net Cost:……………………………….………..…….$4.33

Maximum potential profit at expiration:
$5.00 – $4.33 = $0.67

($0.67 X 100 X 22) = $1,474 – 1.48% for the notional $100,000 model portfolio.

SPY 1-23-13

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