Editors Note:

The market is closed today but that doesn't mean we can't think about trading. Tomorrow's action is likely going to be heavy after an unexpected day off. Trader's are going to be focused on the data of which there is plenty. I've used limit orders for these entries with the thought Thursday's action may be volatile and better prices may be had than what are listed today.


New positions are only added on Wednesday and Saturday except in special circumstances.


WYNN - Wynn Resorts, Limited - Company Profile

Wynn Resorts Ltd. is a holding company, which engages in the development, ownership, and operation of destination casino resorts. It operates through the following segments: Wynn Macau, Wynn Palace, and Las Vegas Operations. The Las Vegas Operations segment covers Wynn Las Vegas and Encore. The company was founded by Stephen Alan Wynn, Elaine P. Wynn, and Kazuo Okada in June 2002 and is headquartered in Las Vegas, NV.

The company's stock has been in a downtrend since early this year. The selloff began after then-CEO Steve Wynn was accused of sexual misconduct and ousted from his position. The stock shed more than 50% of its value in the last six months and now moving higher in a retracement of that fall. The stock is just above $110 and halfway to the first key retracement level.

The first level is the 38.2% line near $133. A move up to that level would be a gain of $20 or roughly 18% from Tuesday's closing prices which would be a nice gain.

Reasons why I think this stock will go higher include its value and company performance. The entire sector has been under pressure, this stock more so, which has pushed relative yield above that of the broad market and attractive to investors.

On the performance end, revenue growth has slowed over the past few quarters but is expected to rebound this year. The company's exposure to Macau is only one reason to think this as new data shows growth in that region growing faster than expected.

The next earnings date is in early February. I don't see strike listed for February, just January and March, and January's give us plenty of time at a much lower cost so that is what I am targeting.

Buy the WYNN January $125 call at a limit price of $2.86, initial stop-loss is $100.

Tol- Toll Brothers- Company Profile

Toll Brothers, Inc. engages in the design, building, marketing, and arranging of financing for detached and attached homes in residential communities. It operates through the Traditional Home Building and City Living segments. The Traditional Home Building segment builds and sells homes for detached and attached homes in luxury residential communities in affluent suburban markets and cater to move-up, empty-nester, active-adult, age-qualified, and second-home buyers. The City Living segment builds and sells homes in urban infill markets through Toll Brothers City Living. The company was founded by Robert I. Toll and Bruce E. Toll in May 1986 and is headquartered in Horsham, PA.

The company just reported a mixed bag of earnings that came with a noteworthy comment. The company's CEO says the media is to blame for slowness in the housing sector. According to him, and I think there is some merit to his statements, the media portrayal of housing markets has caused buyers to shy away.

In the report, revenue jumped more than 21% from the same time last year while earnings increased a more tepid 12.5%. Both figures beat expectations but came with a warning that profits may be weak. The value of signed contracts, a forward-looking estimation of business, has declined by -15% from last year and suggests growth in the sector slowing.

The stock fell sharply on the news but found support early in the day (on the day earnings were released). The stock is now exhibiting signs of a bottom after a protracted downtrend and looks ready to move higher. All the stock needs is positive news regarding housing market conditions and Jerome Powell's comments last week is it. His indication the FOMC will pause or slow the rate-hiking timeline is a signal homebuyers need to get in gear; buy a house now or risk getting left behind.

This stock is cheap and the options are cheap so I'm going out to March on this one.

Buy the March $35 call at a limit price of $1.85. The initial stop-loss is $30.


No New Bearish Plays