Archive for 2005

Friday Outlook & TOTD – LLY

Gasoline is up 20% (.24) in 8 days, merry Christmas!

I think/hope some of this nat gas buying is on speculation and short squeezing rather than on the reality that it now costs 150% more than it did last year to heat homes.

This will not affect today’s consumer sentiment reading but will be a major market bummer if it continues into next month.

Until the report at about 9:30-9:50, expect what will either be a dead market bounce or the start of a very nice Friday rally.


I am going to apologize to Sunoco, they may actually be a better buy than COP but Conoco has made more investments in production while SUN has focused on cutting costs on current production. While SUN may rise faster than COP, I still think COP is the stock for the future.

VLO is really primed to pop at the moment as are THE, SLB, CVX and PTEN. There is a great sale on BP today as the Kuwaiti government is selling $2Bn worth of the stock in Europe. Just like with GNW, you have to wait for the dust to settle but this will be a great buy very soon as well!

NFLX has reached a critical juncture right at $27.50. There is a lot of downward pressure on the stock but it has steadfastly refused to cross this line. They have done a great job bringing costs down and they have low churn despite their much vaunted competition.

========== Trade of the Day ==============

LLY is guiding up but, most importantly, they announced that they have no more patent expirations this decade! I really don’t think they could have said anything better outside of a cure for something popular. This coupled with the Merck collapse makes this my Trade of the Day!

I’m sorry I missed this earlier in the week but there is no time like the present. The stock dropped $1 yesterday on unfounded guidance fears so ignore the first dollar of today’s rally in the stock. We need to give them another quarter to run and also we will pay less of the jump with a longer call so I’m going for the April $50 at $5 (no more than a $2 premium) and I will look to offset it by selling the current $55 or, if we are lucky, $60 as soon as the premium hits…
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Monday Monday

Game on for gold and oil. From the WSJ : "According to a recent study by the World Gold Council, an industry association of the world’s leading gold-mining companies, investment demand for gold rose 56% in the third quarter and is expected to increase further." According to my "poker with the Saudis" scenario, we should get a pretty nice run to the $520 or so range followed by a sudden, viscous pullback. It snowed in NY this weekend so, of course, that means it has just occurred to many traders that we might use some oil this winter so our oil picks are back in play. PTEN, TDW and OII look ripe for a move and SLB may break $100 if the sector is strong (if VLO and XOM are up). I still love my COP $65s but they have not been loving me so I can’t recommend them. Now we know what’s up with BSX, they just made a bid for GDT, trying to steal it from cheapskate JNJ who had the deal locked but then demanded a discount of 15% from Guidant. Now Boston Scientific is offering back around the original price but I think JNJ was right and that BSX is overpaying so I am going to make make BSX my Trade of The Day as a put. Anything above the 50 dma of $25 will be a gift on this stock, there will be big volume, so that’s not an if – which means if it breaks $24.75 then the Jan $25 put will be a nice gamble as long as it is not for more than the 1.60 that the $27.50 was going for on Friday. BSX is a $22Bn company trying to swallow GDT at $25Bn and it is very, very likely that over the next few days, someone will have a problem with that! On the other side of this trade, any chance to buy GDT for less than $70 is also a gift as analysts will jump on the bandwagon to claim $72 is a fair price for the company. DELL has made a nice, slow rising consolodation and looks to be primed for a nice move. I think they are a very safe bet to stay at or above the 50 dma of $31. HPQ has doubled for the year and Dell has dropped 50%, anyone who buys computers knows that…
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Market News

News You Can Use From Phil's Stock World


Financial Markets and Economy

Taking Intelligent Risks: How To Stay In The Trading Game (Trader Feed)

You have to risk money to make money.  You have to make sure you don't risk so much money that you can lose your stake and go out of business as a trader.  Bet too little and you never make a good return on your capital.  Bet too much and you court career risks.  So much of trading success boils down to taking intelligent risks.

Here is a useful calculation tool that can tell you the probability of hitting a drawdown threshold.  


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Zero Hedge

The Media-Opoly: Cancelled, From Saturday Night, It's Conspiracy Theory Rock!

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

A day after we ran "Meet Your "Independent" Media, America", in which we showed how prime time entertainment like 60 Minutes is strategically and voluntarily "planted" with propaganda trolls and "concerns" thus crushing any "unbiased" credibility mainstream US media may have, we dug into the archives to bring you "Conspiracy Theory Rock."

This cartoon created by SNL cartoonist Robert Smigel in 1998 ran once in a "TV Funhouse" segment, and has been since removed from all subsequent airings of the Saturday Night Live episodes. As a reminder, 90...

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Phil's Favorites

Trump vs. Fiorina vs. Obama on Isis; Fiorina and the "Law of Bad Ideas"

Finally, one of the top republican candidates said something intelligent about Syria while the dreadful Fiorina explained how we need to defend our,...yes, OUR territory in the middle east by engaging Russia in a war. Yeah, something like that. 

Courtesy of Mish.

Carly Fiorina Seeks No-Fly Zone

In the Fox interview show below, Republican presidential candidate Carly Fiorina says the US should enforce a no-fly zone in Syria, even if it means shooting down Russian aircraft.

Quote of the day: "Russian jets have been basically conducting dangerous and unpredictable maneuvers around our waters and our borders and our territory".

Can I have a definition of "our" territory please?


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Chart School

SP500 Wyckoff Review

Courtesy of Read the Ticker.

Review of the SP500, pre Oct 2015, fire fighting the technical damage.

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NOTE: does allow users to load objects and text on charts, however some annotations are by a free third party image tool named

Investing Quote...

.."Your goals are to select only stocks that move soonest, fastest and farthest in bull or bear markets. Limited losses and let profits run."..

Richard D Wyckoff

..“Don’t try to buy at the bottom and sell at the top. It can’t be done except by liars.”..


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Kimble Charting Solutions

Opportunity Friday…What would you do with these Opportunities?

Courtesy of Chris Kimble.

Opportunities are knocking at our door friends! I’ve been sharing the Power of the Pattern with customers for the past 20-years. In my humble opinion, some really nice opportunities (based on price, momentum and sentiment) are forming for investors around the world. Below is two of the dozens of rare patterns I am seeing, that I wanted to share with you today.

What would you do with this opportunity?


As shared above, this asset has fallen around 35% of late. The decline has taken it down to its 4-year rising channel support l...

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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.

To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Swing trading portfolio - week of September 28th, 2015

Reminder: OpTrader is available to chat with Members, comments are found below each post.


This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...

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Sector Detector: No rate hike translates into heightened wall of worry

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Sabrient Systems and Gradient Analytics

The Fed’s decision to not raise the fed funds rate at this time was ultimately taken by the market as a no-confidence vote on our economic health, which just added to the fear and uncertainty that was already present. Rather than cheering the decision, market participants took the initial euphoric rally as a selling opportunity, and the proverbial wall of worry grew a bit higher. Nevertheless, keep in mind that markets prefer to climb a wall of worry rather than ride a crowded bandwagon, and I continue to envision higher levels for the markets after further backing-and-filling and testing of support levels (perhaps even including the August lows).


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Some Hedge Funds "Hedged" During Stock Market Sell Off, Others Not As Risk Focused

By Mark Melin. Originally published at ValueWalk.

With the VIX index jumping 120 percent on a weekly basis, the most in its history, and with the index measuring volatility or "fear" up near 47 percent on the day, one might think professional investors might be concerned. While the sell off did surprise some, certain hedge fund managers have started to dip their toes in the water to buy stocks they have on their accumulation list, while other algorithmic strategies are actually prospering in this volatile but generally consistently trending market.

Stock market sell off surprises some while others were prepared and are hedged prospering

While so...

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Baxter's Spinoff

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

Baxter Int. (BAX) is splitting off its BioSciences division into a new company called Baxalta. Shares of Baxalta will be given as a tax-free dividend, in the ratio of one to one, to BAX holders on record on June 17, 2015. That means, if you want to receive the Baxalta dividend, you need to buy the stock this week (on or before June 12).

The Baxalta Spinoff

By Ilene with Trevor of Lowenthal Capital Partners and Paul Price

In its recent filing with the SEC, Baxter provides:

“This information statement is being ...

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Mapping The Market

An update on oil proxies

Courtesy of Jean-Luc Saillard

Back in December, I wrote a post on my blog where I compared the performances of various ETFs related to the oil industry. I was looking for the best possible proxy to match the moves of oil prices if you didn't want to play with futures. At the time, I concluded that for medium term trades, USO and the leveraged ETFs UCO and SCO were the most promising. Longer term, broader ETFs like OIH and XLE might make better investment if oil prices do recover to more profitable prices since ETF linked to futures like USO, UCO and SCO do suffer from decay. It also seemed that DIG and DUG could be promising if OIH could recover as it should with the price of oil, but that they don't make a good proxy for the price of oil itself. 


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Watch the Phil Davis Special on Money Talk on BNN TV!

Kim Parlee interviews Phil on Money Talk. Be sure to watch the replays if you missed the show live on Wednesday night (it was recorded on Monday). As usual, Phil provides an excellent program packed with macro analysis, important lessons and trading ideas. ~ Ilene


The replay is now available on BNN's website. For the three part series, click on the links below. 

Part 1 is here (discussing the macro outlook for the markets) Part 2 is here. (discussing our main trading strategies) Part 3 is here. (reviewing our pick of th...

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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

Thank you for you time!

FeedTheBull - Top Stock market and Finance Sites

About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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