In the Dogs of the Dow stock screen covering the last year there are 50 stocks, the second best performing one is AMD with a gain of 319.7%, just behind AK Steel (AKS) at 374.0%. The reason I try to find these stocks is that I do believe that “what goes up, must come down”, the only question is when. In the case of AMD it looks like that is now. Given the 5 wave up sequence a second wave correction should occur soon. These typically retrace much of the initial (new) bull run but normally do at least 50% or to the level of the 4th wave of previous degree, which is around $5.50.  An April 2017 $11 strike put option can be had for about $1.75 and should be worth about $5.50 or 3.1X. Ask your broker!

Back in early 2011 it looked like this stock had peaked at around $38 after tracing out a nice B-wave. Despite initially dropping quite a bit the stock regained it’s composure and has now spent almost 3 years to get to a slight new high. This is the nasty part about corrections. It is like boiling milk, if you look it seems to take forever and if you take your eye off it the milk is all over the stove in a nanosecond. On the positive side, thanks to the more complex correction, you are given a second chance to get out. We realize that the last C wave could still take the stock just a little higher, perhaps to $43 or so but given the symmetry hat is already there we would exit now.