I Finally ‘Like’ Facebook (FB)

It's taken a few months for the stock to work out the kinks, and now my scans say it's ready to trade

   

I’m not one for fads or hoopla. In general, I stay away from IPOs until they’ve traded long enough so that I can gather data on them so my screens can properly assess their performance. I don’t have any recommendations for my Maximum Options members on Zynga (NASDAQ:ZNGA) or Groupon (NASDAQ:GRPN). I won’t be buying the Twitter IPO.

And this is the first time Facebook (NASDAQ:FB) has bubbled up a trade in my scans since its May IPO.

But when my system unveiled that FB was offering a short-term bullish opportunity, it’s not a signal I take lightly – and neither should you, since I’ve been relying on these scans to lead me to profitable trades like 100% gains in Dollar Tree (NASDAQ:DLTR) puts in less than a month and 77% in Target (NYSE:TGT) calls in about a week’s time.

My research shows that Facebook is setting up another call-based winner.

Buy the FB Jan 30 Call options at 90 cents or less. After entry, take profits if the stock price hits $30.20 or if the option hits $2.20, which will give you a 144% return.

But know your exit strategy before you get involved with the trade. Close the trade and cut losses if FB stock price closes below $25.80 or the option dips to 50 cents.

I may not always be hip to the new fad, but I know a profit opportunity when I see one.

Ken Trester is editor of the popular Maximum Options program. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.  Try Maximum Options today for 2 months for only $99.


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