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Stocks aren’t moving much as we head into the afternoon as traders sift through a weaker-than-expected jobs report and Amazon’s (AMZN) disappointing revenue outlook.
Right now, the market is a mixed bag. There’s no clear standout sector dominating returns — which means traders need to be selective about where they put their money.
I’ve been watching Consumer Discretionary (XLY) and Energy (XLE) closely, but XLE took a dive last week, making it a less appealing bet in the short term. On the flip side, Real Estate (XLRE) continues to struggle, and I’d stay far away from it.
Seasonality tells us the real action is coming in March, April and May — three consecutive months where every sector historically finishes positive. That lines up perfectly with the presidential cycle and could create some of the best trading opportunities of the year.
For now, I’m sticking with Consumer Discretionary as my top sector and keeping Real Estate on my short list. Communication Services (XLC) has also been strong, but February is typically a weaker month for that group, so I’m watching for a better entry in March.
If history holds, the biggest moves are still ahead. Smart traders will position themselves accordingly.
Markets Pause After a Wild Week of Tariffs, Inflation
After a jam-packed week of economic data and policy shifts, the market is taking a breather.
Stocks are flat due to a sharp drop in retail sales, down 0.9% in January, way below expectations. That capped off a week where inflation stayed in the headlines, with hotter-than-expected reports putting a damper on everyone’s hopes for interest rate cuts anytime soon.
At the same time, Wall Street is still sorting through a whirlwind of policy moves from the president. This week brought 25% tariffs on steel and aluminum, Ukraine-Russia peace talks, and a review of CHIPS Act terms.
Even with all that uncertainty, stocks are on track for solid weekly gains after a strong Thursday rally. Delays in the rollout of new reciprocal tariffs gave investors a reason to push the market higher, and now the S&P 500 is near a fresh all-time high.
For now, the market seems to be taking a moment to digest everything. But with so much happening, another big move could be just around the corner.
Apex Indicator: AAPL Is Ready
Last week, we talked about how Apple (AAPL) was almost ready for a trade. Well, AAPL has surged upward and we now have a blue entry signal.
First, here’s our model portfolio for these free signals I share each week:
That 100% win rate won’t last of course, but it is great to see out of the gate! Nothing is ever guaranteed in trading so trade at your own risk. But we’ll keep these signals coming because I want to show off the power of my Apex Indicator.
And here’s the Apex signal on AAPL.
Here’s a Wrap Order to play this signal.
Ticker: AAPL
- 21 FEB 25 EXP.
- Buy to Open $240 Call.
- Sell to Open $242.5 Call.
This should give you a net debit around $1.85 (as of 9:55 a.m. ET)! Our target on the chart is $253.61 and our stop loss level is $207.72.
Keep in mind that the underlying stock will move by the time you read this, so you may need to adjust your strikes, the idea of a “Wrap Order” being to wrap the two strikes around the current price of the stock.
For more training on how to place wraps… go here!
The Monthly Breakout
During this week’s “Opening Playbook” session — join us at 10 a.m. ET every Thursday! — we gave our usual Weekly and Monthly Breakout trades. The weekly was covered in Thursday’s newsletter, and we’ll give the monthly here each Friday.
Just as I said above, the stock price will move so you may need to adjust your strikes depending on where the price is when you read this…
The strikes are the same but I updated the Net Debit to reflect this morning’s prices.
And this week’s Monthly Breakout is GE (GE).
Ticker: GE
- Options: 21 MAR 25 EXP.
- BUY $210 CALL.
- SELL $220 CALL.
Price: $3.21 debit.
Graham Lindman
Graham Lindman Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
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