TradeKing Midday Market Call Recap - $SPX, $TIF

TK All-Star posted on 08/10/16 at 03:02 PM

Featuring @BrianOverby  &  @MNKahn

Quick Takes Pro Market Technician Michael Kahn Analyzes the S&P 500:

S&P 500 index (SPX) was trading at 2,186.46 at the time of analysis, up 5.75 on the day. The index has continued the recent trend of setting new highs, the break out to the upside last week has held strong. The main red flag that continues to lurk around is that the index is still quite a bit above the 200-day moving average - over 40 points, still hinting that the market is a little stretched out. Bottom line is that the trend is to the upside and although there some concerns in the charts, going along with the trend continues to be friendly.

Michael Kahn’s Chart of the Day: Tiffany & Company (TIF)

Tiffany & Company was trading at 63.72 down 52 cents on the day during the time of analysis. The trendline established over a year ago seems to be holding this stock down.  The stochastics indicator is showing a bearish divergence currently. The retail sector in general has not been doing well and this stock in particular has been in a declining trend. Michael thinks the path of least resistance is to the downside.

TradeKing “Options Guy” Brian Overby Analyzes Tiffany & Company (TIF)  - Volatility & Dividends:

TIF’s 30-day Implied Volatility (IV) has resin recently most likely because of the anticipated earnings announcement on August 25th. It is currently at the upper end of the range at around 36%.

TIF does pay a dividend. The yield is a hefty 2.84% and the most recent ex-dividend date was on June 16th and the amount was 45 cents per share.

Brian Overby Shares TIF Paper-Trading Strategies:

Brian’s first paper trade was a Long put spread, he is using a shorter expiration for the option contracts and this bearish trade done for a net debit to the account. The second paper trade is a bearish longer term expiration Long put.

Brian’s First Paper Trade - Long put spread.

- Buy 1 Aug 19th, 2016 TIF 65 Put

- Sell 1 Aug  19th, 2016 TIF 62 Put

- 10 days to expiration  

- Net Bid 1.23, Mid 1.31, Ask 1.38 for the strategy

- Net debit is 1.31 if we get it at the mid-price; note that this is not always possible

- Maximum potential loss: 1.31

- Maximum potential gain: 1.69

- Total commission to enter this trade at TradeKing is $6.25

Brian’s Second Paper Trade - Long put.

- Buy 1 Sep 16th 2016 TIF  60 Put

-  38 days to expiration

- Bid 1.34, Mid 1.40, Ask 1.45 for the put

- Debit is 1.45 if we pay the asking price

- Maximum potential loss: 1.45

- Maximum potential gain: 58.55 if the stock went all the way to zero.

Important notes: Option prices are given as a per-contract amount. Multiply loss and gain figures by 100 shares and by the number of contracts traded to determine the amount of the full potential loss or full potential gain. No additional calculations are needed to determine commission costs.

TradeKing Options Tools used:

- TradeKing Volatility Charts

- TradeKing Options Pricing Calculator

- TradeKing Probability Calculator

- TradeKing P&L Calculator

Options involve risks and are not suitable for all investors. Prior to buying or selling options, an investor must receive a copy of Characteristics and Risks of Standardized Options, sent to you in previous communication. Additional copies may be obtained by calling TRADEKING at 877-495-KING or by visiting

Multiple leg options strategies involve additional risks, and may result in complex tax treatments. Please consult a tax advisor.

At the time of publication and in the preceding month, TradeKing and/or Michael Kahn did not have ownership greater than 1% in any stocks mentioned; did not have any other actual, material conflict of interest known at the time of publication; have not received compensation from a public offering nor from investment banking services related to any companies mentioned within the past 12 months, nor expect to receive any in the next 3 months; nor engaged in market making in the securities mentioned.

System response and access times may vary due to market conditions, system performance, and other factors.

Any strategies discussed and examples using actual securities and price data are strictly for illustrative and educational purposes only and are not to be construed as an endorsement, recommendation, or solicitation to buy or sell securities. Past performance is not a guarantee of future results. Consider the following when making an investment decision: your financial situation, your risk profile and transaction costs.

Market timing is a complex investment strategy which involves risk and may incur additional commission costs.

While implied volatility represents the consensus of the marketplace as to the future level of stock price volatility, there is no guarantee that this forecast will be correct.

TradeKing charges $4.95 for online equity and option trades, add 65 cents per option contract. TradeKing charges an additional $0.35 per contract on certain index products where the exchange charges fees. See our FAQ for details. TradeKing adds $0.01 per share on the entire order for stocks priced less than $2.00. See our Commissions + Fees page for commissions on broker-assisted trades, low-priced stocks, option spreads, and other securities.

The projections or other information generated by TradeKing's tools regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results and are not guarantees of future results. The calculations do not take into consideration all costs, such as commissions and margin interest which may impact the results shown. It is the user's sole responsibility to select the criteria to enter in the TradeKing's tools, or to choose among the predefined screens, and to evaluate the merits and risks associated with the use of the tools before making any investment decisions. TradeKing is not responsible for any losses that occur from such investment decisions.

TradeKing Webcasts and All-Star Blog are provided for educational and informational purposes only. All investments involve risk, losses may exceed the principal invested, and the past performance of a security, industry, sector, market, or financial product does not guarantee future results or returns. TradeKing provides self-directed investors with discount brokerage services, and does not make recommendations or offer investment, financial, legal or tax advice. You alone are responsible for evaluating the merits and risks associated with the use of TradeKing's systems, services or products.

TradeKing selects and defines as All-Stars certain independent market commentators who are recognized industry personalities and experienced traders and who provide timely market commentary via the TradeKing All-Star Blog and/or TradeKing Webcasts. Each All-Star commentator's bio, related qualifications and disclosure as to their relationship with TradeKing can be found on the All-Star Roster. The selection of All-Star commentators is solely based on the quality and style of the content provided. TradeKing does not measure, endorse, or monitor the performance or correctness of any statement or recommendation made by independent All-Stars commentators. Supporting documentation for any claims made by TradeKing All-Stars will be supplied upon request by the author of the post, who is solely responsible for the views expressed. Contact TradeKing All-Stars by sending an email message to

© 2016 TradeKing Group, Inc. All rights reserved. Securities offered through TradeKing Securities, LLC, member FINRA and SIPC.


Posted by TK All-Star on 08/10/16 at 03:02 PM


You must Log In to post to this blog.

Not a member? Register Now to …

  • See what other traders are doing
  • Make your own trades public
  • Share your thoughts on a trade
  • Join or start a group
  • Connect with like-minded traders