Last week we discussed the possibility of the S&P 500 Index rallying after comparing the Index s similar actions in late February of this year:

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1 April 24 th 2013 In this week s Cash Cow Newsletter we are going to evaluate the current performance of the S&P 500 Index, briefly review the current performance last week s profit opportunities, and look at several new profit opportunities for the May 3 rd option expiration. Last week we discussed the possibility of the S&P 500 Index rallying after comparing the Index s similar actions in late February of this year: S&P Repeats Rally After Correction S&P Rallies After Correction As you can see, our inclination was correct. The S&P 500 Index has gained 2.4% since Thursday s close. If this trend continues, the S&P will carry on its 1

2 upward momentum into next week. We could profit from by continuing to initiate call option purchases on select stocks. As we discussed last week, many companies are reporting their 1 st quarter earnings this week and next week, so we will look to avoid stocks that are reporting during this time period. Before we get into the new profit opportunities I d like to briefly review the current performance of last week s picks. All three opportunities from last week s newsletter are currently profitable since Thursday s close. The first profit opportunity we looked at last week was TGT. The stock is up 2.08% since Thursday s close. The stock is currently trading near the upper Keltner Channel. We should consider taking partial profits on this position and look for better profit opportunities elsewhere. The second profit opportunity we looked at last week was DIA. The ETF is up.92% since Thursday s close, and is currently trading near the middle Keltner Channel. We should consider rolling over this position into next week s expiration, as DIA is likely to continue to advance in price. The last profit opportunity we looked at last week was JNJ. The stock is up 1.45% since Thursday s close, and is currently trading below the upper Keltner Channel. Even though the stock is trading under the upper Keltner Channel we should consider rolling this trade over into next week s expiration, as JNJ has continually traded above and slightly below the upper Keltner Channel for months on end. Now let s take a look at some new profit opportunities for the May 3 rd option expiration. 2

3 The first profit opportunity we ll look at this week is WAG (Walgreens): Walgreens operates a network of drugstores in the United States. The company provides consumer goods and services, pharmacy, and health services throughout its drugstores. Walgreens has consistently increased their Equity and Retained Earnings over the past 4 years. As you can see from the chart, WAG has done noticeably well in recent months, and is in a strong price up-trend. This up-trend is confirmed through the presence of an up-sloping On Balance Volume. By today s close, the stock dropped between the upper and middle Keltner Channels. This offers us a good entry point into this stock. We can take 3

4 advantage of any future price gains by purchasing a call option on WAG for the May 3 rd expiration. The next profit opportunity I d like to show you this week is SNDK (SanDisk): SanDisk Corporation designs, develops, manufactures, and markets flash storage card products that are used in numerous consumer electronics products throughout the world. The company has had consistent Equity growth over the past several years. SNDK is currently in a 50/100-Day EMA up-trend that is confirmed by an upsloping On Balance Volume. After dropping down to the lower Keltner Channel this week, SNDK has begun to recover from this retracement. 4

5 Currently the stock is trading below the middle Keltner Channel, giving us a good entry point into this position. We can take advantage of future price growth by initiating a call option purchase on SNDK for the May 3 rd expiration. Last but not least, our final profit opportunity for this week is GILD (Gilead Sciences): We looked at Gilead Sciences once before in our March 20 th newsletter. The stock gained an impressive 9.95% by the following Friday s expiration, providing amazing profits for those that participated in the trade. GILD dropped -5.18% today along with many other major stocks in the same sector, including Amgen (AMGN) and Celgene (CELG). This substantial drop 5

6 in one of the top performing sectors of 2013 could provide an excellent entry point into this stock. Therefore, we should consider purchasing a call option on GILD for the May 3 rd expiration. Click on the link provided below to access the Cash Cow Archive. Cash Cow Newsletter Archive: 6