Trade of the Day: GameStop Corp. (NYSE:GME) –

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We’re still in June, so I suggest that traders remain cautious at this point. When Wall Street titans such as Carl Icahn and George Soros come out and say that the equity market is running on fumes, their words should certainly be taken into consideration.
Furthermore, when the market rises on decreasing volume over time, which is what has been happening, it’s not a good sign. The market, as measured by the S&P 500 index, had its lowest-volume day of the year last week as the index rallied above the 2,100 level. To put it another way, trading has not been this light since the Christmas holiday at the end of 2015, which is what I would call a serious lack of conviction.
The latest reading on new jobless claims was released yesterday, and it fell to the lowest level in six weeks, as new applications for unemployment dipped from 268,000 last week to 264,000 this week. As you can imagine, those numbers did not represent an improvement on any level that would excite investors across the board.
And today, I have a downside play in a brick-and-mortar game store that is showing some weakness in the charts going all the way back to last April. Based on my analysis, downside pressures should continue to lean on the stock in the weeks ahead.
Buy to open the GameStop (GME) Oct 25 Puts (GME161021P00025000) at $1.60 or lower.
InvestorPlace advisor Ken Trester brings you Power Options Weekly, which delivers 5 new options trades and his latest trading advice to you each Friday. It’s the perfect “bridge” between investing in ordinary stocks and the turbocharged world of options trading. In Maximum Options, he brings you his personal trades using high-probability, “professional grade” strategies.
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.
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