We’ll probably never know for sure, but if Forrest Gump had been a trader, as opposed to – I dunno – a runner, soldier, ping-pong player, or shrimp boat captain, he’d probably have said “Wall Street is like a poker game.”
What I mean is, in the markets, people and institutions deploy the poker face. They’re never quite up front about what it is they’re doing, for fear of giving up that all-important first mover advantage. It’s why we have things like dark pools of liquidity, so money can make big moves off the “official” radar.
But just like most poker games, if you watch closely, you can usually spot a “tell,” something that tips the other player’s hand, that puts you in prime position to close in on big profits – really big profits if you use cheap, low-risk trades like the ones I’m about to give you.
I’ve uncovered three stocks Big Money is paying unusual attention to this week, and two trades for about a buck each you can make on two of them…
Stocks Poised for Big Moves This Week
If Merck & Co. Inc. (NYSE: MRK) stands out for any reason, it’s its lack of action over the months since the 2020 “COVID-19 Crash.” It’s not a wild stock by any stretch of the word; it’s down 5% year to date, and over the past five years, it’s really only moved about 23% higher. Compare this to the S&P 500, which is up more than 108% over five years.
Today, the stock sits just below $73… but there’s at least one big-money trader – a “whale” – who’s betting it gets to $80 by November.
“Deep Pockets” set up a November call spread with options on MRK shares, buying 20,000 of the $75 calls and selling 20,000 of the $80 calls, paying $1.31 for the five-point vertical.
This is definitely a trade to piggyback, but you don’t need a fancy-schmancy spread to do it. A ton of October options in MRK fit two of my most basic Profit Revolution criteria…
- Inexpensive options.
- The ability to return 100%, 200%, 300%, or more.
I like the MRK Oct. 22, 2021 $75 calls for this one, at a cost of around $1.
Cameco Corp. (NYSE: CCJ) is a uranium miner that has also been kind of sleepy compared to the flashy marquee stocks we hear about all the time. Prices started to perk up in mid-August, but it hit my radar this past Friday after I saw 400,000 – yes, four hundred thousand – of the December contracts trade. I like this name going higher – it’s already up 5.2% over the past five sessions, too.
For a cheap option play, I’d look at the CCJ Sept. 24, 2021 $26 calls for $1 or less.
Intel Corp. (NASDAQ: INTC) is another stock I’d keep an eye on; it’s ripe for gains right now. In fact, this past Friday, I dropped a live recommendation on INTC shares. The option was only $1 at the time, but by Monday, it was sitting above $1.50.
— Mark Sebastian
Source: Money Morning