This was an easy one.
After the Street discounted Ross Stores (ROST), we jumped on it with the ROST November 65 calls at $2.50. As of today, ROST is up another $1.05, sending the calls to $3.20. If you’re happy with the current gain, sell to close half of the position today to secure gains. Be sure to hold the second half for a bit longer.
Hold all other positions.
As for new recommendations, let’s jump on McDonald’s (MCD) as the Street discounts a great name. It’s now down $9 a share off its 2014 highs, becoming massively oversold on MACD and RSI. The last time MCD got this oversold was November 2012 before the stock ran from $80 to $100.
We believe China and US concerns have been priced in.
- Buy to open the MCD January 2015 95 calls up to $3…
- Buy to open the MCD December 2014 95 calls up to $2.50…
When Wall Street finally wakes up and sees just how oversold MCD has become, we expect to see a good rally.