I am not liking TSRA price/action this morning so I decided to close my position and sell my November $25 calls for a 17% profit. The stock reversed from a 52-week high and is currently trading down 1.5% on high volume. This is not a good sign. Sometimes it is better to protect profits at the very first signs of weakness. If INTC doesn’t report extraordinary earnings tomorrow, TSRA could very well tank. If that happens, a second buying opportunity might arise when TSRA retreats to the 10-week line. Look for institutional support before pulling the trigger however.
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The TSRA trade I recommended on October 8th is currently working. On Friday TSRA advanced 3.8% in 62% higher volume, a sign of continued institutional support. It also marked a new 52-week high @ $31.63.
My November $25 calls are already showing a 20% return as of today. If the market continues to trend higher, TSRA should follow. On Tuesday Intel reports earnings and that could affect the price of TSRA as well.
I expect this stock to move another 5 or 6%higher before possibly pulling back to the 10-week line. Continue to stay long as the market conditions continue to improve.
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Tessera Technologies designs smart/micro optics and chip-scale, multi-chip, and wafer-level packages for semiconductor manufacturers.
The stock, ticker TSRA broke out of a consolidation yesterday with a buy point of $29.35. TSRA is currently 2% extended in price but it is still in safe buying range. Volume on the breakout has been impressive, a sign that large institutions are buying shares.
Today I initiated an aggressive position with deep-in-the-money November $25 calls. We shall see if this breakout continues to work.
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