Optioneering Newsletter

September 9, 2018

Mini Dow Futures Monthly

We trade with the trend and the long-term trend is up. The current target is
27,500.

The first profit opportunity we will review this week is in SAGE, or Sage
Therapeutics. Sage Therapeutics develops medicine that is intended to
transform the lives of patients with life-altering central nervous system (CNS)
disorders.
 SAGE Monthly

SAGE was extremely bullish for three months at the end of last year. Since
then it’s been forming a flag. A flag is a continuation pattern. That suggests a
further advance.
 SAGE Daily

As you see, SAGE was very bullish at the end of last year. It’s been going
sideways since then. Sideways trading in a bull trend usually yields to a further
advance.

We are going to review a Call Debit Spread for SAGE.

Traders who want to employ a more leveraged approach can buy SAGE
calls. SAGE has options expiring every week until October 26th. After that,
SAGE has options expiring in November, January, February, and January
2020.
 Buy to Open SAGE October 26th 145-Strike Call
Sell to Open SAGE October 26th 157.50-Strike Call

We can see from the Call Option Spread Analysis Calculator that if the SAGE
stock price declines by 2.5%, stays where it is, or increases in price when the
options expire, the spread will make a 60.3% or $470 profit. If SAGE is down
-5% when the options expire, the spread will make 54.7% or $426. If SAGE is
down -7.5% when the options expire, the profit will be 1.7% or $13.

The next profit opportunity we will review this week is in IRBT, or iRobot
Corporation. iRobot was founded by three MIT graduates who designed robots
for space exploration and military defense. The company designs and builds
consumer robots, including a range of home vacuum cleaners, floor moppers,
and other autonomous cleaning bots.
 IRBT Monthly

After pulling back for about a year, IRBT took off in June and hit a new record
high last month. New record highs are bullish.
 IRBT Daily

The daily chart for IRBT has been very bullish since May. The pullback from
last month’s record high gives us a buying opportunity.

We are going to review a Call Debit Spread for IRBT.

Traders who want more leverage can buy IRBT calls. IRBT has options
expiring every week until October 26h. After that, IRBT has options expiring in
December, January, March, and January 2020.
 Buy to Open IRBT October 26th expiration 85-strike Call
Sell to Open IRBT October 26th expiration 100-strike Call

We can see from the Call Option Spread Analysis Calculator that if the IRBT
stock price declines by 2.5%, stays where it is, or increases in price when the
options expire, the spread will make a 53.1% or $520 profit. If IRBT is down
-5% when the options expire, the spread will make 34.9% or $342. If IRBT is
down -7.5% when the options expire, the profit will be 8.5% or $84.

The next profit opportunity we will review this week is in HIIQ, or Health
Insurance Innovations. HIIQ is a developer and administrator of web-based
individual health insurance plans and related products and services.
 HIIQ Monthly

The monthly chart shows that, except for one bad month, HIIQ has been in a
strong bull trend since late-2016.
 HIIQ Daily

The daily chart for HIIQ is also very bullish. An upside breakout looks
imminent.

We are going to review a Call Debit Spread for HIIQ.

Traders who want a more leveraged approach could consider buying HIIQ
calls. HIIQ has options expiring in September, October, November, January,
February, and January, 2020.
 Buy to Open HIIQ November 16th expiration 45-strike Call
Sell to Open HIIQ November 16th expiration 55-strike Call

We can see from the Call Option Spread Analysis Calculator that if the HIIQ
stock price stays where it is or increases in price when the options expire, the
spread will make a 60% or $375 profit. If HIIQ is down -2.5% when the
options expire, the spread will make 52% or $325. If HIIQ is down -5% when
the options expire, the spread will make a 29.7% or $186 profit. If HIIQ is
down -7.5% when the options expire, the spread will make 7.3% or $46.

The last profit opportunity we will review this week is in TQQQ. TQQQ is the
ProShares UltraPro QQQ. TQQQ seeks to yield results that correspond to
three times the daily performance of the QQQ.
 TQQQ Monthly

TQQQ hit another new record last month. New record highs are bullish.
 TQQQ Daily

As we said above, TQQQ just hit a new record high on last month. The
pullback from the record high give us a new buying opportunity.

We are going to review a Call Debit Spread for TQQQ.

Traders who want a more leveraged approach could consider buying TQQQ
calls. TQQQ has options expiring every week until October 26th. After that,
TQQQ has options expiring in November, December, January, March, and
January.
 Buy to Open TQQQ November 16th expiration 53-strike Call
Sell to Open TQQQ November 16th expiration 64-strike Call

We can see from the Call Option Spread Analysis Calculator that if the
TQQQ ETF price declines by -2.5%, stays where it is, or increases in price
when the options expire, the spread will make a 41% or $320 profit. If TQQQ
is down -5% when the options expire, the profit will be 25.2% or $197. If
TQQQ is down -7.5% when the options expire, the spread will make a 4% or
$31 profit.

EARNINGS SEASON: There are four “Earnings Seasons” a year. The

seasons begin in January, April, July, and October and they each last
about two months. The earnings reports can have an impact on the stock
price. We don’t know if the impact is going to be positive or negative (or
nothing at all). It’s up to you to decide if you want to be in a trade when the
earnings report is announced. Here’s a link for a page that can help you
keep track of the report dates:

https://www.earningswhispers.com/calendar
 Note: Profit performance displayed in this newsletter does not include transaction
costs.

This newsletter includes some trading ideas following Chuck Hughes’ trading
strategies along with educational information. For a complete listing of Chuck’s
exact trades, including specific entries and exits and real time Portfolio tracking,
please call Brad at 1- 866-661-5664 or 310-647-5664