Advertisement
Australia markets closed
  • ALL ORDS

    8,153.70
    +80.10 (+0.99%)
     
  • ASX 200

    7,896.90
    +77.30 (+0.99%)
     
  • AUD/USD

    0.6517
    -0.0019 (-0.29%)
     
  • OIL

    83.06
    +1.71 (+2.10%)
     
  • GOLD

    2,245.00
    +32.30 (+1.46%)
     
  • Bitcoin AUD

    108,520.32
    +2,808.10 (+2.66%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • AUD/EUR

    0.6039
    +0.0009 (+0.14%)
     
  • AUD/NZD

    1.0908
    +0.0028 (+0.26%)
     
  • NZX 50

    12,105.29
    +94.63 (+0.79%)
     
  • NASDAQ

    18,254.69
    -26.15 (-0.14%)
     
  • FTSE

    7,952.62
    +20.64 (+0.26%)
     
  • Dow Jones

    39,807.37
    +47.29 (+0.12%)
     
  • DAX

    18,492.49
    +15.40 (+0.08%)
     
  • Hang Seng

    16,541.42
    +148.58 (+0.91%)
     
  • NIKKEI 225

    40,168.07
    -594.66 (-1.46%)
     

Time to bet on casino stocks?

It's been a tough week for casino stocks; shares of Wynn (NASDAQ: WYNN), MGM (NYSE: MGM) and Las Vegas Sands (NYSE: LVS) fell 8, 7 and 4 percent, respectively, in the past five trading sessions. But according to one trader who relies heavily on both the charts and option, it might be time to double down on one name in particular: MGM.

"MGM has pulled back to its 100- and 50-day moving average," said Keene on Friday's " Trading Nation ." According to Keene, those levels should act as support and a good entry point. "I think there's opportunity to buy this pullback for upside to $26.50 per share."

The technical level coincides with some recent bullish activity in the name, as well.

Read More How a Chinese travel rule spooked luxury investors

ADVERTISEMENT

"There's been a lot of institutional call buying in MGM this week," noted Keene. When traders buy calls, they are making a bullish bet that a stock will go higher. And according to Keene, there were three large trades that raised his eyebrows. "Thursday saw a large lot of buyers of the May 23-strike calls and [Friday] we saw buyers of the May 22 and 22.50-strike calls." These are bets that MGM will rise above $23, or 6 percent higher in the next month.

So to make his play, Keene followed suit and purchased the May 23-strike calls for 45 cents each, a trade that is profitable That's a bet that MGM will rally above $23.45 by May expiration.

"Strong institutional order flow combined with the charts makes this a great opportunity to profit from a potential rally in MGM."

Want to be a part of the Trading Nation ? If you'd like to call into our live Monday show, email your name, number and a question to TradingNation@cnbc.com.



More From CNBC