| | | | $6,000 Gold?!
First, don’t miss today’s Daily Chart Setup trade idea down lower in this newsletter.
The flow show edition out last week has Hartnett predicting that the yellow shiny metal we know as gold will reach $6,000 by next spring. Let's take a look at the outlined whys and how realistic the prediction is...
Come join me as we dive in and see what’s moving!
Plus, as always, we have stocks popping and dropping so come find out what is moving this morning as I look for stocks and do some live premarket analysis on SPX, SPY, NDX, QQQ, Russell, IWM and other stocks that are potential plays for the day.
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How I'm Collecting 225% Annualized on a Bullish Windup Pattern
There's a trade setup I recently discovered that made me stop and pull up my calculator right in the middle of analyzing charts.
I’m talking about 18% monthly returns on a stock that's also showing one of the cleanest bullish chart patterns I've seen in some time. That's the kind of opportunity that doesn't come around every day — and when it does, you'd better understand exactly what you're looking at.
The stock is Hims & Hers Health (HIMS) — but I’m trading HIMZ, a 2x leveraged ETF — and the premium being offered on certain put options is nothing short of extraordinary. But here's what makes this interesting beyond just the numbers — the chart is actually backing up the trade with a legitimate technical pattern (chart below).
The Premium That Made Me Do the Math Twice
Let me walk you through the specific setup I'm working with here.
I sold puts at the $16 strike (HIMZ was trading around $20.50 Friday afternoon) and collected 60 cents in premium for about a week's time. Now, when you're dealing with options, these numbers might not sound dramatic at first — but let's do the actual math on what this represents.
On a position of 10 contracts out to Oct. 17, that's $600 collected against $16,000 of potential risk for roughly a week. Then I looked at Nov. 21 for a new position, and you could collect $3,000 for $16,000 of potential risk.
When I calculated it out — and yes, I did this live because the numbers seemed almost too good — that works out to 18% return in a month, which annualizes to nearly 225%.
That's what I call "wow premium."
Look, I know what you're thinking — if the premium is that rich, there must be significant risk. And you're absolutely right...
HIMS carries real risk, no question about it. But this is where the technical analysis becomes critical to the entire thesis.
The Chart Pattern That Changes Everything
What separates this from just a premium grab is the underlying chart structure. HIMS is showing a classic bullish windup pattern — move up, retrace, move up, retrace, move up.
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