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Tough Talk, Tougher Market

SPECIAL NOTE: You’ve probably heard by now that today was the last commentary for Reitmeister Trading Alert. The service officially closes tomorrow. Steve has been talking about the end for the past several days and has a few suggestions on what subscribers should do from here. Learn more at the end of this commentary. 


The market held up reasonably well on Wednesday, especially considering that much of the media jumped right to “WAR!” in response to yesterday’s tough talk. It’s going to take more than another aggressive act by North Korea or another presidential tweet to derail this market. It’s not as if these things are unheard-of. 

The major indices spent the entire session on the negative side, but there was a sharp end-of-the-day rally that pared the losses significantly. In fact, the S&P nearly came all the way back with a dip of only 0.04% to 2474. The Dow had its second consecutive session in the red after a 10-day winning streak, but it’s still well above 22K and only finished lower by 0.17% on Wednesday to 22,048.7. The NASDAQ was off 0.28% to 6352.3. 

“While fear is rising with the VIX topping 12 today, the market shrugged off the news. When it was all said and done we were pretty much flat on the day in the S&P,” said Jeremy in Counterstrike

It was “business as usual” in the services today. Options Trader added another option to a portfolio favorite, while Momentum Trader picked up a stock that Dave hopes to “buy higher and sell higher”. Meanwhile, TAZR added another position to take advantage of increasing volatility. The highlights section below has more on these moves and more. 

Today's Portfolio Highlights: 

Options Trader: Kevin is feeling pretty good about his bull call spread in CME Group (CME), which he added back in June and will make $576 if it can get to $135 or higher by mid-December. The editor is so confident that he wants to increase the upside of the bet, so he bought to open a Dec 130.00 Call to go along with it. CME was a big winner for the portfolio in the past, and Kevin expects it to be so again. Read the full write-up for more. 

Momentum Trader: The strong North American and recovering European consumers have Dave thinking that Royal Caribbean (RCL) has further to climb. This is certainly one of those “buy high, sell higher” moves, as the cruise ship operator is up nearly 50% this year. The editor is encouraged by its positive surprise last quarter and improved guidance for next year, so he added RCL on Wednesday with a 12.5% allocation. Don't miss the complete commentary for more specifics on this new addition. 

TAZR Trader: As Kevin said yesterday, he’s expecting more volatility in August, especially after all this North Korea drama. One of the editor’s favorite vehicles for buying volatility and protecting the portfolio is ProShares Ultra VIX Short-Term Futures ETF (UVXY). On Wednesday, he sold Adobe (ADBE) for a gain of 2.7% since it is well-priced and susceptible to a market slide. Kevin then had enough cash to pick up a 7% allocation in UVXY. Read more in the full write up. 

Home Run Investor: Make it two in a row for the portfolio, as it once again had the top performing stock of all the Zacks services on Wednesday. Shares of Tucows (TCX), one of the largest domain registrars in the world, jumped more than 12.2% today in the wake of its quarterly report. The company has been in the portfolio since January when Dave picked it up after acquiring the eNom domain name registrar. Home Run also had the top performer yesterday when TCMD jumped by more than 12%.

Reitmeister Trading Alert: "The end of day bounce Wednesday was the real story…not the early morning tumble. 

"Simply stated, investors used the North Korean sabre rattling news as an easy excuse to take some money off the table. As the day wore on, more investors saw the early morning decline for the sham it was and were happy to buy the dip. 

"The road to 2500 may have taken on a couple more potholes, but investors will still find their way there soon enough. And likely 2600 a quite reasonable end of the year target. 

"Stay strong and stay long!" -- Steve Reitmeister in the final commentary for RTA. 

Have a Great Evening,
Jim Giaquinto



Goodbye RTA!

Yes, Steve has decided that a daily commentary is too much considering all his other duties here at Zacks, so Reitmeister Trading Alert is riding into the sunset with a successful track record. He’ll have a new weekly commentary, The Reitmeister Report, starting on September 6. 

For RTA subscribers, Steve suggests that you just keep those positions for now and look for other Zacks services to meet your investment needs. As a ZU subscriber, you have access to EVERYTHING we offer, and he suggests a combination of Large-Cap Trader, Value Investor and Counterstrike as a great substitute for RTA. There’s no need to sell all of the portfolio’s positions now; just use your best judgment as you move onto other services. 

Steve feels that this is the best path forward. But for those who aren’t comfortable with “coasting” right now, he does have another course of action that we will mention tomorrow. Better yet, go right now to Reitmeister Trading Alert for Steve's detailed suggestions.

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