Weekend Trader Series
April 21, 2024
Open Positions Update
- The ConocoPhillips (COP) June 21, 2024, 125-strike call reaches its time-stop this Monday, April 22. Close the position at a limit price within range of the current market price when you place the order.
- Close the Tenet Healthcare (THC) June 21, 2024, 97.50-strike call on Monday, April 22. Close the position at a limit price within the range of the current market price when you place the order.
The following is this week's recommendation:
Interactive Brokers (IBKR)Place a limit order to buy the Interactive Brokers (IBKR) June 21, 2024 105-strike call at a limit price within range of the current market asked price when you place your order. At the close on Friday, April 19, this option was offered at $9.60. IBKR closed at $111.55 on Friday, April 19.Do not attempt to enter this position after Monday's close.Please use the following guidelines to manage the position:- Exit the position if the option is at a 100% gain from your entry price.
- If the option has not reached its target profit by 3:00 p.m. Eastern time on Monday, May 13, close the position.
- If there is a change to the above closeout parameters, we will notify you in your regular Sunday evening communication.
Shares of Interactive Brokers Group (IBKR) are in a solid uptrend. Last week, support emerged at the stock’s 50-day moving following an all-time higher earlier in the month. The security is also above $105, which is double its 2022 closing low and 1.5 times its 2023 closing low. Adding to this bullish technical setup, IBKR is trading above both its pre-earnings and post-earnings closes that followed the company’s April 16 report.
Short interest is triple the average daily volume and has doubled since November, now at levels in which covering occurred in both 2022 and 2023. There’s heightened odds for short covering in the immediate future, too, as most short position since November are underwater.
Total put open interest (OI) on Interactive Brokers Group stock exceeds call open interest. This is a potential contrarian indicator on the outperforming stock.
Our recommended June 105 call has a leverage ratio of 8.6, and will double on an 11.3% rise in the underlying shares.
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