Oftentimes, it pays to watch the day-to-day trading actions of “Sharp Paper” traders.
That’s what I call big money traders who are willing to commit large amounts of capital playing directional calls or puts.
For instance, here’s a hypothetical…
Say a trade crosses the tape showing someone just bought 500 calls on Home Depot for $700,000 just before its earnings report.
Is this something you’d pay attention to?
Heck yeah it would be!
Does this Sharp Paper buyer have inside information?
Do they know that Home Depot is about to make a big upside move?
Who knows? Anything’s possible…
I’m certainly willing to take a very close look at someone putting three-quarters of a million on the line for a single trade. With that sort of conviction, I’m more than happy to tag along.
Do Sharp Paper traders always get it right?
Of course not.
They’re human, just like everyone else…
However, every once in a while, they hit on returns that are truly spectacular. And these are the winners that make this methodology worth pursuing.
This leads into a Sharp Paper trade I noticed this afternoon…
Earlier today, a rather large bullish call order came across the tape on JPMorgan Chase & Co. Specifically, someone bought 1,268 of the JPMorgan November $120 calls for $5.35. In total, it was a $678,380 order.
So of course I looked at JPMorgan’s chart. And honestly, it looks overbought. JPMorgan just blasted through resistance at $120 – and then extended up to $124. That’s quite a run. I’m not so sure I’d be comfortable buying more than half a million dollars’ worth of calls at these levels.
However, this big JPMorgan buyer prompted me to look at some other financial charts…
Lo and behold, Goldman Sachs (NYSE: GS) looks a lot better.
Action Plan: If Goldman Sachs follows in the same path as fellow financial leader JPMorgan, shares will break above the $220 level and extend to new highs. In The War Room, we outlined this exact strategy – and gave our traders the precise parameters for an entry price on Goldman Sachs. If you’d like in on this trade, you’re invited to join me in The War Room today!
[adzerk-get-ad zone="245143" size="4"]About Bryan Bottarelli
Whether it was selling the Star Wars figures he collected as a little boy for 50 times their value or using the $125 he made cutting grass to buy a Michael Jordan rookie card that he later sold for $1,500, it was always clear that Bryan Bottarelli was a born trader – possessing the unique ability to identify opportunities and leverage his investments.
Graduating with a business degree from the highly rated Indiana University Kelley School of Business, Bryan got his first job out of college trading stock options on the floor of the Chicago Board Options Exchange (CBOE). There, he was mentored by one of the country’s top floor traders during the heart of the technology boom from 1999 to 2000 – trading in the crowded and lively Apple computer pit. Executing his trades in real time, Bryan learned to identify and implement some of his most powerful trading secrets… secrets that rarely find their way outside the CBOE to be used by individual traders.
Recognizing the true value of these methods, Bryan tapped into his entrepreneurial spirit and took a risk. He walked off the CBOE floor and launched his own independent trading research service called Bottarelli Research. From February 2006 to December 2018, Bryan gave his precise trading instructions to a small, elite group – most of whom have been followers ever since.
As a “play tactician,” Bryan uses his hands-on knowledge of floor trading to shape opportunities and chart formations into elegant, powerful and profitable recommendations. And by using the same hedging techniques taught by professional floor traders, Bryan is able to deliver his readers remarkable gain opportunities while strictly limiting their total risk.
Along the way, Bryan has developed a cumulative track record that could impress even the most successful hedge fund manager.
He now spends his days moderating one of the most elite trading research forums ever created: The War Room.
