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Trade of the Day: Cabot Oil & Gas (COG)

This oil and gas stock just keeps offering bullish opportunities


Reasons are plenty for the current index and indicator weakness, ranging from potential monetary policy shifts, to political and budget stalemates, to geopolitical troubles. Also, after we pass through the upcoming holiday and first week of a new month, both traditionally bullish calendar periods, September historically has not been a good month for stocks. The indexes could use the upcoming bullish time frame to launch a short-term bounce off of currently oversold conditions, but the adjective “short term” needs to be emphasized here.

One good way to play that short-term bullishness is with Cabot Oil & Gas (COG). The name may look familiar if you’ve been following  Trade of the Day–my colleague Jon Markman saw an opportunity to trade the stock a few weeks ago. Now my Power Options system is showing a great opportunity for options on the stock.

The stock is currently pulling back slightly and consolidating from its August 28 high of $39.91, but even small moves can affect the option’s price. The option my system highlighted is undervalued with over a month of time value left.

Recommendation: Buy Cabot Oil & Gas (COG) October $42.50 call options at 65 cents or lower. After entry, take profits if the stock price hits $42.20 or the option price reaches $1.70. Exit if the stock price closes below $38.00 or the option price falls to 40 cents.

InvestorPlace advisor Ken Trester has launched Power Options Weekly. This brand new weekly service delivers 5 new trades to you each Friday. It’s the perfect ‘bridge’ between investing in ordinary stocks and the turbocharged world of options trading. 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 Power Options Weekly today and receive 2 weeks for the price of 1 for only $19.95.

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