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Tuesday Morning

Superman ReturnsUp, up and away – it’s Super Market!

It’s bugdet proof, oil proof, terror (threat) proof, housing proof, inflation proof and pullback proof 3 weeks in a row!

This is truly a Market of Steel (and the recent movement of X underscores that) and looking at the movement of the past week we really do have to believe it can fly…  Is the US consumer (driver of 2/3 of the economy) really impervious to harm?  What, if anything, is our stock market Kryptonite?

Why is the retail sector down 7% for the year if everything is so great?  I know, I’m supposed to switch my brain off and just go with the flow but even Superman can be more effective if he knows to look out for glowing green rocks.  The rational approach to this sort of market is to participate in the rally, enjoy it while we can, but keep a lookout for signs of weakness that undermines the overall strength.  As I said back on August 22nd: "We (US equities) may actually be the least sucky place to put your money in the second half of ‘07."

While we took a bullish posture based on my outlook, we didn’t take THAT bullish of a posture as there are just too many darn things lurking in the corner for us to ignore.  Here we are, one month and 1,000 points later and we’ll have to say it this time like we mean it: "Sure we have this overhang of sub-prime mortgages and we’re fighting a war of attrition for goals we’re uncertain of at an absolutely staggering cost while plunging the economy onward to $10T in debt but – so what?  We’ve been doing that since 2003 and the market is up over 50% since then and last year I dubbed it the Meatball Market because bad news Just Doesn’t Matter!"

It just doesn’t matter, It just doesn’t matter, It just doesn’t matter, It just doesn’t matter, It just doesn’t matter!

Unstable currency, runaway commodity prices, spiraling inflation, low savings rates, hedge fund collapses, declining home values, banks writing down their virtual portfolios, hundreds of thousands of layoffs, millions of foreclosures — it simply does not matter as long as they are LOCAL problems for the US as we are a smaller and smaller cog in the great global economy, one day we may even be granted emerging market status by our Chinese masters!

Sure we’re lagging behind the rest of the world and sure, from a global perspective, the decline in the dollar has wiped out all of our market gains.  Sure our performance compared to Japan, India, China, Russia, Brazil, Mexico, Indonesia, North Korea, Taiwan… is a total joke but even the benchwarmer on the championship team gets a little champagne spilled on them once in a while.

Three weeks ago we discussed how the runaway success of the global markets has left China flush with cash and we were very suspicious that this whole rally could have been nothing more than window dressing as we prepare to dump our stocks on China’s new Investment Company, which is mandated to throw $200Bn into the global markets, possibly injecting that much new capital every year!  In addition to China, the Abu Dhabi Investment Authority has $875Bn petrodollars to invest, GIC Singapore has $330Bn and Norway’s Pension Fund is looking for a place to park $300Bn.  GM plays the market with their $95Bn pension fund, making more money there than they do selling cars!

As long as it all keeps going up, this is no problem and one could even imagine that, even if the rest of the world markets start to flatten out, we are so far behind that our markets may still keep going up.  If we were to update the above map, the US would be all alone in the light green this year amongst the industrialized nations, Europe and Australia blew past us in Q3…

Notice at no point in this conversation are we discussing fundamentals!  This rally is nothing more than hyper-inflated capital looking for a place to go and US equities represent a fairly liquid, fairly tangible asset that can absorb Trillions of overseas dollars without becoming too unstable (we hope).  Just as we diversified into emerging markets when our economy was on fire in the late 90′s (leading to disaster but that’s another article), other countries will diversify into the pokey US markets, especially with a fire sale on the dollar.

The Dow (an index of multinational corporations) stands 40% behind the Nikkei and the CAC 40 since 9/11, we are 75% behind the DAX and 100% behind the Hang Seng.  If those markets keep going up, we really don’t have a choice!  The Hang Seng came off a holiday and added yet another 1,000 points yesterday, closing at 28,199.75 despite Greenspan calling the Shanghai market a bubble.  "If you ever wanted to get a definition of a bubble in the works, this is it." he said, at the end of a third quarter in which the HSI gained 45%.

Europe is also continuing on in party mode with half-point gains across the board.  Money is still flowing from Europe to the US as our market looks irresistibly cheap at $1.42 to the Euro.

At home we will be thrilled to just hold yesterday’s highs but the banking sector should get yet another boost as TD uses those mighty Canadian dollars to pick up my favorite bank, CBH for $8.5Bn, giving them control of 2,000 US branches and $250Bn in deposits.  Don’t get too excited, 75% of the deal is TD stock, which is up 30% this year and it works out to just about $42 per share for CBH, who were at $39 yesterday.  Still, CBH had a HUGE p/e of 26 and this will get all the lazy analysts to sharpen their pencils in a sector with an average p/e of 17 and well-known names (and possible takeover targets) like SUSQ, NPBC & MTB all trading well below 15.  We’ll keep an eye on these three, especially the two Nasdaq banks, for signs of a sentiment shift but I can’t wait on MTB so let’s grab 5 Nov $105s at $4.50 for the $25KP, we’ll sell the Oct $105s if it breaks back below that line.

Let’s keep an eye on holding positive today,  It would be nice if oil stays below $80 so we can start buying some transports.  YRCW is very tempting down here but let’s see how the day goes.  Gold will take a big hit on a dollar bounce but we covered our gold plays at $750 so no worries there.

Have a fun day,

- Phil

 

 


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  1. Demetrius Michael

    YAH BRAZIL!! WOO EWZ!

  2. MrN

    SIRI – Phil did you buy back cover yet?

  3. Optrader

    BIDU-300 pre-market. Looks like I am going to DD on my puts with tight stop.

  4. billbigd

    Fast Money- Phil had a giggle at your expense. Saw your pal Najarian was named top 100 trader by mag Trader Monthly. LOL
    BIDU-aded by J.P Morgan price target $400 by end of year of 2008

  5. jkman

    well boys…we ready?

  6. Demetrius Michael

    Ofcourse, bring out the dart boards.

  7. Demetrius Michael

    ummm IBM?

  8. Phil

    SIRI – just the 25% from yesterday, if we hold up today I’m willing to cut back a bit more.

    BIDU – ballistic!

    I have nothing against Najerian (well one of them anyway), his system is good for what it does, it’s just that it can be (and is) manipulated.

    Darts it is!

  9. Demetrius Michael

    Interesting market.

  10. Phil

    XOM taking a nice dip, back to .85 on those $90 puts, let’s not be greedy as tomorrow is inventory day and all those extra barrels we ordered won’t show up for at least another week.

  11. Phil

    MTB flying, I offered $4.70 for the Nov $105s in the $25KP but I’m not chasing after it. XXX

    Why is FXI going down off the gap?

  12. Demetrius Michael

    I’m getting out of MOT, trade turned boring.

  13. Demetrius Michael

    Good news and the market goes down? I thought we had a bunch of upgrades today. That’s an unreal gap on FXI I would sell it.

  14. Phil

    Bought back FXI callers for $3 profit, rolling up to $185 puts for $2.75, a good trade for $7 in position!

    Metals and oil will hold us down today even if we get other strength, let’s watch the Russell as they should be happy about all this.

  15. Demetrius Michael

    You lie! PQ’s up, and that’s oil!…

  16. Demetrius Michael

    Well Garmin was a gamble…

  17. MrN

    What’s the problem with the metals?

  18. Demetrius Michael

    Garmin’s going to 102! YES. Put on!

  19. Demetrius Michael

    BUD is doing well.

  20. Demetrius Michael

    DRYS Breaking Par?

  21. JPL

    BBD, what do you like? Thanks

  22. Phil

    OII still flying high, there’s one to play to the downside if the sector starts to break down. Nov $75 puts are $2.80 and I’ll offer $2.5 to get started on a position.

    FWLT looking to test $140 before the crash (I hope).

    SHLD on a roll, JWN picking up buyers, BBBY, M – like I said this morning, the retail sector is looking cheap and it’s a strong internal sign if people are bargain shopping today.

  23. Demetrius Michael

    Current, Expected, Previous.
    Pending Home Sales m/m -6.5% -2.0% -10.7%

  24. Demetrius Michael

    EMC Nov 20 look good

  25. MrN

    IMCL waking up?

  26. k1

    Morning all. Dumped my DIA puts, as a quick review of my positions showed a heavy downside directional posture. I’ll probably follow Phil’s direction to roll XOM puts to November if I can scalp the spread a nickel.

    Having trouble wrapping my head around Dow 15000. Just doesn’t seem right, somehow.

  27. bigduke6

    the russel is partyin

  28. Jacox Boy

    Phil:
    I’m holding GRMN Jan 120′s with a 20% loss. Could you make a recommendation?
    Just selling is not a problem, just thought there might be a way to play it
    since I’m
    already in?
    Thanks.

  29. billbigd

    OII- I am long.
    GRMN- bought some Jan’s
    VDSI- pulled some off 33% gain.

  30. Phil

    Pending home sales lowest EVER down 6.5% from last month, down 21.5% from last year – Will it matter?? It’s old news but stunningly bad.

    SU falling hard! COP is going to test $85 and XLE $75, if they blow those marks, there should be another 1% down before they find support. That would be great for YRCW, wich is a safer play on the Jan $30s at $1.75 than oil puts are. So let’s make that 5 in the $25KP but no chasing. XXX

    No sense in not stopping out of winning plays – lots of things to buy with cash! XXX

    Wow, this FSLR never gets old, buying Dec $130s to start a roll. XXX

  31. Demetrius Michael

    Jan 08 or 09?…. If it breaks under 102, I would get out of the trade. GRMN is risk at it’s finest, like all that LVS WYNN and BIDU stuff.

  32. DanW

    BIDU – Opt, what’s your thinking on BIDU?

  33. MrN

    BBD – MON right back at the level you played yesterday. You still in or going to trade it today?

  34. jomama

    Phil, are you covering your TM’s before the auto sales report today? (that is if you still own the 120′s.

    thanks

  35. Demetrius Michael

    But then again, if you did buy LVS, WYNN, and BIDU… You would’ve been rich if you bought 3 shares and waited a couple days…. It’s sketchy not playing these.

    My boy Blue! IBM…. Don’t do this to me…. Market’s red, but you don’t have to be! :)

  36. mSquare

    Phil,

    TASR: Have a few Jan08 $10 Calls left from long back spread. It is currently $6.90. Should I just sell it and wait to buy later or roll?

    Also have TASR stock with cost around $13.6. What calls (if any) to write against it?

  37. Phil

    IMCL – DD at $4.70 to reduce basis to $5.70, half back out at $5.70.

    Wow, lots of selling going on now. DIA $139 puts are still just $1.10, can stop at $1 XXX

  38. billbigd

    MON- I am gone but watching it again.

  39. Demetrius Michael

    UNH, HES, WLP….

  40. jkman

    Wow, lots of selling going on now. DIA $139 puts are still just $1.10, can stop at $1 XXX

    phil is that a play or grabbing for protection?

  41. Denis

    MU earnings?

  42. Optrader

    BIDU-Dan, I DD’d on the puts at $306.5, sold at $303.50, then bought puts back at $306.5 again and just sold them at $303. Still down for the day, but it’s ok. I think I am going to do this all day if it goes back to $306.5. I am buying puts at this level with a stop at $308.
    Longer term, I don’t know anymore. This chart looked real good for puts the last 3-4 days, but this upgrade today just changed everything and there a lot of shorts in there, so it could run real fast.

  43. nu2trading

    Phil: VIX on the run? a play?

  44. Optrader

    I also bout some new puts this morning: DIA, XOM (thanks, Phil) and just bought some PALM puts as well.

  45. KC

    BillBigD – well, maybe after yesterday, people aren’t that concerned about the financial sector anymore, and of course I already sold my VDSI. Good call on taking Dec position.

  46. Demetrius Michael

    I’m in again with the DIA puts

  47. dday97

    At least GOOG is still up.

    My GS 220 caller is laughing at me right now.

  48. MrN

    Is the market looking nasty or is it just my screens?

  49. MrN

    Oh good there are some green spots – all on the LEAPS I’ve sold calls against!

  50. dday97

    Nice BIDU trades Op. I’ll look at that more closely today for some swings.

  51. KHAANNN!!!

    I bet fwlt will be red within 15 min

  52. irished

    Looks like PNRA rebounding nicely. Good call Phil.

  53. dday97

    Getting out of my XOM puts I had for .70 yesterday…nice. Looking at the 90 calls ahead of tomorrow. See if I can make it on both ends.

  54. Phil

    GRMN – I recommend taking money when you are ahead next time! Jan $120s are a terrible position based on a bit too much entusiasm… You can start improving your posiiton by selling the $110 calls for $3 and using that money to roll yourself down to the $110 calls.

    Advance/Decline shows this is a selective, not broad sell-off. There are lots of profits to be taken so that is no surprise.

    XOM – .10 stop here as I’m just glad to be even on the $90 puts.

    TM – no, I’d rather have the protection.

    TASR – I’d take it off if you have no covers. That was a good top!

  55. Brandon WAlker

    Yep just got out of XOM for 1.25 w/ basis of .70.

  56. irished

    Any gut feeling on RIMM play this week. Take profits and run or wait till the earnings I believe this week? It has taken back about 10 percent of options so far.

  57. bigduke6

    come on XOM, bottom out so my stocks can go up!

  58. rcha

    DIA puts(Thanks Phil) from Yesterday, Up 13%….Sell/wait….Pl advise.

  59. dday97

    RIMM – I have the Nov. 105′s and sold half of the Oct. 100′s.

  60. Phil

    VIX – we did that yesterday but I’m out here, that’s a lot for one day!

  61. Demetrius Michael

    Dow might touch 14k, but I doubt we’ll go any lower than that.

  62. Khuong Nguyen

    LULU made ATH trying to break 45. Holding QLNLI right now.

  63. lindsay

    phil, what do you think about GS?

  64. bigduke6

    whats wrong with aapl?

  65. dday97

    What do you mean what’s wrong, AAPL is up on a red day?!?

  66. irished

    RIMM: Went back and read my notes and you had said sell half and let rest ride. That is what I did last week. Forgot. So will sit on half Dec. and see how it goes! Disregard my question. Thks dday97

  67. bigduke6

    heh for a second there it look liked it was diving south though

  68. jkman

    has anyone got a fill yet on the YRCW’s ?

  69. Demetrius Michael

    LULU is going to $1000! lol I’ll be the best analyst!…

    Q: “why do you think LULU is valued so high?”
    A: Because everyone’s buying it!

    Q: Any other reason like P/E, PEG, Acid tests, or any other valuation models?
    A: NOPE!

  70. jkman

    the jan 08′s for 1.75 phil mentioned earlier

  71. DanW

    XOM – is there a reason why the Oct 85P’s barely move now that I’m arse-deep in a loss?

    Bah.

  72. Demetrius Michael

    Out of DIA puts, bored, thanks phil. Good call, sniper.

    Today’s a really nice buying op if SPX holds over 1540.

  73. Demetrius Michael

    DanW – Every Dollar drop on XOM, you’re option should move 10cents higher.

  74. rcha

    Still learning……why are we not buying BIDU, with the price target of $400? The analyst is wrong? Even then, I think it may hit $350 soon.

  75. irished

    Just got filled few minutes ago on YRCW

  76. irished

    Anybody having more than usual problem loading/updating/F5 this site today?

  77. bigduke6

    yea this site is a pain in the arse :) every refresh leads to an error. i have to refresh 2 times every reload.

  78. Demetrius Michael

    rcha – Well it’s 400 by end of 08. But it doesn’t matter what the analyst thinks… Why buy it if it’s going down? Are you picking bottoms? I mean if you buy now and it goes to 400, and I buy when it starts running (say I even miss the trade buy 10 dollars), how much do you gain over me? Is the extra 10% worth the risk? I would give up profits for security any day.

  79. Brandon WAlker

    Anyone have any thoughts of a good exit point for DIA 140′s? Think we’re heading lower?

  80. Brandon WAlker

    Thoughts on the XOM 95 calls at .60?

  81. coolkid

    any thoughts on GRMN at 100???

  82. billbigd

    BIDU- just an FYI I bought some Jan’s. DM sorry. LOL

  83. Phil

    RMBS flying.

    DIA puts, that was a mo play, at this point it should be tightly stopped, markets are holding up well(ish) so far.

    PNRA very cool – I love hitting those bottoms! Normal resistance at $43.25 from the 50 dma, no reason to worry unless we break below $42.75 where we cover with the Nov $45s at $1.60. XXX

    XOM – I stopped out too early – oh well… I still have a ton of XLE calls I sold so I didn’t want to overbet after such a nice run (especailly catching up from a double double).

    RIMM – pre earnings sell-off was to be expected (that’s why I sold the $100s). They are a great mo play now if the Nasdaq turns up (and if they hold $95) but I wouldn’t risk a naked call into earnings with those premiums.

    DIA puts, when you’re up 13% in one day (4,745% for the year) on a volatile index put, it’s probably a good idea to take a little off the table by 15% and have a stop at a 10% gain. You can always buy it again, of buy the next level down or whatever – there are all sorts of amazing things you can do with cash…

    GS – I have a Jan/Oct $220 spread, I’ve had no reason to change it and it’s still a $9 spread, which is pretty annoying.

    SHLD totally breaking out now.

    AAPL – nothing wrong with them, normal people take profits when a stock has run up 30% in a month. 8-)

    GRMN going tragic, we’ll see if they hold $100.

    YRCW – no. Too many buyers spiked it up after my call. I’m moving on to the Apr $30s, 5 at $2.50 XXX

  84. alfamike

    Urm maybe BIDU needs a rest, it’s kinda extended. EMC looking good though! Look at that pretty chart:
    http://finance.yahoo.com/q/bc?s=EMC&t=1y&l=off&z=l&q=c&c=
    Lots of strikes too. April 30′s at .25 probly not a bad bet.
    Other healthy IBD stocks: MGM, ACM, DSX.

    Love those Pats.

  85. Demetrius Michael

    Walker – I’m out already because it’ll take a real reason to drop the market more…Like maybe some good news or something, cause bad news ain’t cutting… Switch to 10min, sell when you see 2 green bars.

  86. MrN

    EMKR – guess I should have believed myself as to why I bought it in the first place and not sold those calls counting on it hitting 10 and struggling!

  87. Phil

    Sellers taking a break, still seeing mortgage cos with strength.

    CAKE looking good, Jan $25s at $1.75, 5 for the $10KP, 10 for the $25KP XXX

  88. Demetrius Michael

    are you going to eat it too?

  89. jkman

    RMBS- i sold yesterday at close. very painful to watch today

  90. coolkid

    DM :-) :-) :-)

  91. Demetrius Michael

    Out of my GRMN puts. Par is enough.

  92. Phil

    XOM $$85 puts, because they’re a mile out of the money and you’re running out of time. That’s why we roll to tighter positions, once you get that far out you rarely recover.

    Financials popping, watch BSC at $130!

    As predicted, here comes BTK – IMCL will hopefully follow.

    Last week on this server – Jared promises. We’ll be down Friday night, maybe into Saturday on the changeover.

    Here comes XOM I think, watch your puts and/or callers.

  93. k1

    Out of XOM 90 puts at 1.25, for a 20% loss after my DD. Sheesh, I don’t have the nerves for the oil patch, I’m going back to LTP stuff and the occasional DIA strangle.

  94. rcha

    Thanks DM. By the way, where you from….you were talking about Dinner yesterday. What time zone you in.
    Bigd…BIDU jan at what strike?

    Phil, Why not buy FSLR Dec 130 “in the money” at $120. That has only $5 difference in the Ask but $10 in strike.

  95. fredrang

    Maximum Pain point. I do my own calculations which is tedious. Does anyone have a web site that does the calculation? I found one some time ago but it’s no longer active. I only do these for major positions when selling Puts.

  96. Demetrius Michael

    I like Jared, he’s one of those guys under the radar that nobody recognizes because he doesn’t spam the boards. Are you running this on a Linux server?

  97. k1

    MaxPain: http://www.iqauto.com/cgi-bin/pain.pl

  98. Phil

    OIH group looking very weak, very strange. Great for our SLB puts!

    XOM $95 calls – that’s pretty far away but not a bad cover if you have puts you don’t want to sell, they were $1.40 yesterday so it’s a nice risk/reward for 17 days.

    Very likely XOM is just resting at the 2.5% rule and ready to make the next leg down from here, that would take them at least down to $90 if they break here, then I’d be more interested in the $90 calls for sure, just on a bounce. 2.5% rule means we can expect a 20% bounce back to $92, if they bounce there and look to fail again (probably in the next 45 mins) then a spread of the $95s and the $90 puts back at $1.10 would be a great play so taking a chance on some $95s now is a good idea. XXX

  99. Demetrius Michael

    No no it was lunch!
    First few dates are always lunch, so you can make them a little more light hearted… and less sketchy.

    lol I’m in London / Toronto / Hamilton Ontario… All 3 have airports lol.. EST timezone.

  100. Brandon WAlker

    XOM 95′s – I’m not covering anything – sold my puts 30 minutes ago….was looking for a short/quick pop…

  101. billbigd

    Jared- probably needs a hand! DM why don’t you give him one. On your way to Phil assistant. LOL

  102. alfamike

    Right they’re gonna have to change the name to http://www.PSW-DemetriusMichael.com – kind of wordy tho.

  103. richard marble

    Financials and retail are hanging tough. Without them breaking down, I don’t see much downside (unfortunatly for my puts…..)

  104. Phil

    DM – I was thinking about that line but decided it was way too cheesy – thanks for being there!

    PEP selling off, you know it’s profit taking!

    FSLR – I bought the $130s because they will be less affected by a $10 drop, which I do expect.

    Linux – don’t think so.

    WFR on one of their sporadic tears, could get interesting if they break $63. Nov $65s are $3.40 and we can sell the Oct $65s on a turn. XXX

  105. dday97

    XOM- took the 90′s at 3.1

  106. billbigd

    Alpha- EMC is looking good! I might have to eat my words and buy some. You live in Mass?

  107. rcha

    Filled 10 CAKE at 1.65. The bid/ask was same…how so?

    Sold some Mutual funds to play more options. Phil…I am here for a week, still do not where the $25 KP is.

  108. Demetrius Michael

    …oh here comes the jokes… Whatever man! It’s better being a top options trader’s bitch, than being broke! But go on keep laughing at the Coffeeboy… Have you fun now!!!

  109. Demetrius Michael

    How come Alpha gets the credit?! No respect for the coffee boy.
    and yah, have you fun now.

  110. rcha

    Comeon DM, no one’s laughing. You can take a joke, right. No fun without taking such digs…gets boring.

    EMC on a run…any plays

  111. greedpeace

    i guess shorting goog WAS funny.

  112. Demetrius Michael

    lol yah I’m just screwing around, I don’t care haha… I’m would wait on EMC and see how it plays out… If you start seeing a break over 21.4.. then jump on the wagon… If not, you might be able to get it at a lower price… If it’s under 20.9 be glad you didn’t buy it.

  113. millions07

    any thoughts about UNH?

    Thanks

  114. bmb

    Hm. My GOOG Oct 590 covers are already ITM.

  115. rcha

    Thanks everyone…..Goodnight. I work nights…got to get some sleep.
    I hope the DIA is down 70 or more when I wake up. I am hanging onto my puts.

  116. biodieselchris

    I guess I should just buy HB calls and make a million dollars like everyone else instead of holding these damn puts!

  117. bob812many

    WAG is the sell off over blown?? Sale prices ??

  118. biodieselchris

    Ben Stein is my new hero.

    Somebody needs to stick up for those poor Big Oil companies! And the infantilizing tone was so cute too!

  119. Jonathan Parker

    What happened to GOOG?

  120. juliet

    GMKT slow as a turtle but fianlly making me some dinero.

    j

  121. Mark

    Nice pop on SLM with the news…

  122. Demetrius Michael

    Greed, you can short google if you want… Just wait for some red tape, there’s no way it can continue growing at it’s rate… No one really uses any of google’s products..

    Addense is useless, especially when my “adblock” for firefox blocks all advertisements.

    Youtube is cool, but video quality is below the industry standard.. And it’s clearly not as profitable was they want it to be.

    The rest of their services are pretty cool, but it just doesn’t add up to their growth rate. I mean, how many times have you guys clicked on an ad from google? You could say their search spider is amazing, but I only really use google for the simplicity.. Not the results… I have a feeling they’re pulling an Exxon with their stock. Don’t flame, it’s just a hunch.

    I mean there are companies you can buy and see their products… AAPL, LULU, UA, RIMM, NOK…
    And then there are companies you can’t… GOOG, NT, (Enron? If they still have a ticker), Exxon? Google to me is filled with great ideas, good pay, and flexible hours… It’s a really good company, but it’s hard as an investor to see how they actually make money.

  123. djczing

    AKAM might be waking up. Good tight trade off 28.

  124. Demetrius Michael

    Euh friend just got hit by a bus. Enjoy boys.

  125. Demetrius Michael

    kinda coincidental how I keep leaving at this time.

  126. Mark

    Anybody trading UPL? Testing 65 again… can it break thru to test the 70 range again from ’06?

  127. jkman

    YRCW- nice timing. time after time on calls like that. yet somehow i’m still amazed every time

  128. bigduke6

    oil sucks. hopefully oil gets the hell down and stays down.

  129. Phil

    Today is a gift for repostioning more bullish. Able to buy out some callers a little lower than yesterday and choses new covers with care (although I still love the FXIs).

    Don’t forget how much of a drag oil is on the indexes (15%) so this is a pretty good performance with commodities taking a dive (gold is down $20).

    XOM heading off to that $92 test but looks like they will fail $75 first, just as significant. TSO looks like they think they’ve gone down enough for one week. Oil is right at $79, let’s see which way that breaks between now and 2:35.

    GOOG $593! Almost time to roll again! At this point, I have to start adding some Nov $590 puts at $17.50, now $20.50 to see how the test of $600 goes. If it goes over, I can sell the current $590 puts for $10, not a bad spread but I would have to be pretty certain they’re breaking up. XXX

    HB puts – always dangerous.

    What happened to Google: http://www.youtube.com/watch?v=8rRTQtvoJQ0

    BIDU marches on. Makes sense China fund will want Google, those guys can certainly see the writing on the wall and they want to be able to censor it! The mistake in valuing Google is not realizing they are a media company and media generates over $1T in advertising annually. While they get their ass kicked by print, radio and TV, Google does control the ONLY growing segment. If they can maintain their market share, all they have to do is wait for the $985Bn of advertising that is not currently on the web to drift their way but YouTube shows that they are more proactive than that and I believe by 2010 you will hear people say “Did you see that show on Google?” They could grow thier global ad revenues to $50Bn a year (5x current revs) and that would only be 5% of global ad sales – hardly out of the question for a company that controls 67% of the web’s ad revenues.

    Speaking of which, so now I have a Jan/Oct $570 spread which I will next roll to a Mar/Nov $590 spread as an even trade. That’s another month for free! XXX but no hurry as my caller still has $7 in premium.

    Really DM? If so, hope he’s OK.

    UPL – not the best day for an oil play, sector could collapse (probably not but could).

    YRCW – picking good stocks is easy, it’s the timing that kills most option players. Greed is the other thing that kills people.

    XOM – that was a really weak-assed attempt at $92. $90 puts are $1.15, best was $1.30, may as well pick some up here and get 1/2 out at $1.30 or all out at $1.05. XXX

  130. marathonman

    Phil…
    Wow, this FSLR never gets old, buying Dec $130s to start a roll. XXX

    Do you already own leaps on this and then rolling them with the above trade?

  131. Phil

    FSLR – I have several positions and I’m laddering up every $10. So I sell the Oct $125s against the Dec $120s and the Oct $115s against the Dec $110 and I then buy a round of Dec $130s on a run, up, sell $135s on the turn, sell my lowest calls (the $110s) and sell the $115 calls when the downward momentum stops. I think I started with the $90s and I make a couple of thousand each round take it off the table by buying cheaper calls for myself and one set I did a DD, so far the position’s up about $20K on an initial spread of $20K but I’m now holding $81K “worth” of calls against $34K in calls I’ve sold. I always try to tell people, as long as you have a 60+ day spread within $5, it is never a problem if your caller does well.

  132. billbigd

    MARK- I guess you don’t read a fellow Dallas poster. LOL I bought UPL at 52.50 on 8/30 as posted here.

  133. bigduke6

    we gotta bounce sometime today…

  134. Mark

    BBD – Of course you did! I thought I remembered seeing it a while back from someone (should have know it was you). Good times…

  135. MrN

    EMKR – bye it was nice having a long-term relationship with you while you were still cheap! :(

  136. Yev

    Phil, others, where do you see a good entry point for Apple(low 150-152)? Other then profit taking this morning it seems to be pretty strong, but feels like the direction has changed short term. I got scared out of my Oct 145 covers this morning, as I was down on them about 35%. I also sold out of my Jan calls for 20% profit.

    I did not want to roll because I believe we will have a very strong month ahead for Apple between earnings, Leopard, and a Christmas run-up.

    Thanks

  137. Jonathan Parker

    Random Question Phil – COMS.. being acquired by Bain and Huawei for $5.30 expected to close in Q1’07. Okay, even taking into account the fact that maybe the deal doesn’t go through, do you find it strange that the ask on the $2.50s from the Octobers to the Jan ’09s is unchanged at $2.50?

  138. djczing

    Im sittin here with CNBC completely turned off.

    I find my concentration level is up, my anxiety level is down.

    Next step is that ive always wanted to trade with some cool jazz in the background.

  139. greedpeace

    what are the not so obvious “goog holding 600″ plays?

  140. jeddah62

    VMC – yessssss

  141. CMan

    PHIL,
    FXI – Missed your recommendation y’day – I still have following unhedged positions Oct 175s and Jan 160s.
    Appreciate your suggestion on rolling/hedging them
    Thanks!

  142. Fan

    Phil / Anyone:

    Thoughts on playing RIMM earnings by buying Nov 100 calls @ 7 and selling Oct 100 calls at 5? Net debit of $2 (max risk). Oct IV seems very high relative to Nov (b/c earnings). Comments appreciated. Thanks!

  143. JPL

    BBD,

    JEC – is this your stock?? This has been on a tear are you long?

    DE is pulling back – where would a good re-entry on this puppy be?

  144. Richard

    PNRA – good trade, Phil. As you said, it’s all about the timing – and listening to Phil, of course. The Feb 45Cs are doing exceptionally well.

    DSX – Alpha, I like these guys, and it appears to be holding a possible breakout level here above all previous highs. It’s certainly trading that way today. Actually, I like the stock compared to the others in that sector, excepting DRYS, of course. DRYS is floating on helium, it seems to me. DSX seems a better play at this level.

    Anyone have any thoughts on this?

  145. Phil

    Lazy Condor play:

    Buy BIDU $250 put, BDUVJ @ $1.45
    Sell BIDU $270 put, BDUVW @ $3.50
    Buy BIDU $340 call BPJJG @ $6.80
    Sell BIDU $320 call BPJJC @ $12.10

    You collect $7.35 and get paid between $262.65 and $327.05 with an outside risk of $12.65 and we can always adjust it if we have to.

    That’s an XXX in complex spreads.

    =====================================================

    AAPL – no way would I take a naked position on them. Way too much of a run for me. See my Google roll for how to roll Apple, I don’t know what people have against rolling back a month, it’s no big deal…

    COMS – no, that just means that they don’t believe the deal will change so that’s just the price. You could take the Jan ’10 puts for .30 and sell the current $5 puts for .15 and hope you have enough months to scalp enough nickels to be worth it but once they close the deal you’re done.

  146. rahul

    Phil – I’m long FXI Nov 80 Puts (basis 11.65 now 9.4). I would like to roll this out to 1/2x Jan and sell against it as I was not able to yesterday. Should I do this now or close the positiona and wait for the turn before opening the new position.

  147. Juice

    “Lazy Condor” — how lazy is this really on a stock that can gap up or down 5-10% on a day? Earnings are after Oct expiration, so you think BIDU will consolidate here between 265 and 325?

  148. millions07

    anybody playing the GRMN drop?

    Thanks

  149. billbigd

    JBL,
    JEC & JCI yes. Don’t mention it as PHIL will want to short like FWLT. LOL
    KHANN- girl was on Lincoln Ave reporting

  150. biodieselchris

    Phil – fundamentals mean nothing!

    As long as the market continues to trod out the Chewbacca Defense the rally continues, homebuilders losing money quarter over quarter included!

  151. Richard

    Good one BDC! That’s exactly what’s going on now.

  152. Richard

    Did anyone read Jason Goepfert this morning?

    Or maybe the better question is, Does anyone ever read Jason Goepfert? I find his statistical analysis interesting sometimes, and some of it is very obscure. Today was very interesting however. Here’s a quote from today’s article –

    He looked at “returns during the month of October (after the first couple of days had passed), but only during years ending in ’7′……As we can see, the returns were stunningly bad. Only one of the 11 instances going back to 1897 was positive in the Dow Jones Industrial Average. On average, the maximum gain seen during the month was a downright pathetic +0.7%, and only two of them showed a max gain of more than +2%. The average drawdown, however, was a monstrous -12.0%, with all but one year showing a loss of at least -5%.” The analysis went from 1897 through 1997, and showed an average loss after the first few days of October of 8.5%.

    If 100 years of history holds true, maybe the day of reckoning for this nonsense is sooner than most folks think.

    Any thoughts?

  153. CMan

    optrader,
    Do you concentrate on a handful of plays at a time instead of a wide variety that Phil has? If so, how do use this site (what is the value of this site for you? Just curious – because I am finding it difficult to keep track of all my positions and am seriously considering narrowing down my plays to a handful and just love this site/forum. Would appreciate any suggestions on best way to get out of OTM spreads.

  154. billbigd

    DM-You watching BIDU?

  155. Quarryman

    THanks for noticing Jeddah62.

    This stock is ripe for going long.

  156. bob812many

    Richard,

    “October. This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August, and February.”

    Mark Twain

    I’ve been lookin for that set-up all day :)

  157. djczing

    Its rather ironic that the only thing holding up the market today are financials and homebuilders…

    Oh – and select Tech (GOOOOG) !!

  158. jkman

    VMC does look tempting

  159. Greg

    Jason Goepfert has great sentiment analysis, but I don’t see any sense in only looking at years that end in 7 LOL

  160. biodieselchris

    I can’t help it. I’ll take CFC 17.50 puts for 0.30

  161. Greg

    quarryman: I have been watching the cement/aggregate co for a long time waiting for then to bottom and move back up. Now I have to wait for a pull back on VMC. Also watching RMIX and it is not following VMC and CX, any insight?

  162. Phil

    Google Condor:

    $560 puts at $4.70, sell the $580 puts for $9.70
    $640 calls for $3.70, sell the $620 calls for $7.80

    That’s a $9.10 credit with a $10.90 max loss between $570.90 and $629 – a little scarier than BIDU but I’ll try a few.

    ====================================================

    FXI – those are calls? What basis?

    RIMM spread, I like that for $2

    FXI – I’d sell a caller for $4ish and take a $4ish roll up on your current position.

    BIDU Condor – well, since they gained $10 in the time since I posted it I’m not so sure but, like I said, we can always reposition if they break $315

    Chewbacca Defense – LOL, I didn’t even have to click that one – it’s one of my favorite legal strategies!

    LVS $145!

    LULU closing in on $100.

    Bad October – I talked about that the other day, lots of nonsense using dates as a benchmark!

    BG well down, ICE falling, CTSH turning down.

    Auto sales – GM up 3.8% – Woopie! Good for a Dow rally, watch XOM at $92!!!

  163. Richard

    USU running.

  164. biodieselchris

    please let me know when the Hang Seng looks toppy because I’m going to short this thing to the teeth.

  165. billbigd

    SLB-going green
    CMI-Great sale yesterday LOL

  166. jkman

    PCLN- looks like its positioning for a big move. thinking up but not sure enough to act on it

  167. Phil

    Ford down 17%, Chrylser not in yet (expected down 5.3%), hardly a reason to rally.

  168. jeddah62

    BG – Holy cow .. falling off a cliff!

  169. Quarryman

    Greg,

    RE: VMC

    This stock has sold off substantially since its high in May and triple bottomed out in SEP. I’m a little surprised at the 10 pts in three days, but maybe not. Here’s why: crushed stone is the first major supplier in and the first one out. Get a building permit, get a highway entrance permit then it’s stone for entrance, construction area, foundations, then out.

    Quarries lead the up and down cycle for a local economy. So many good industries have been tainted by the murky subprime woes. Traders are realizing the value inherent in the construction materials cos. that has not been realized… we’re not that far from the next up cycle in construction and crushed stone will be first on the job. Aggregate cash flow is also supplemented by a typical 25-40% government-based cash flow from municipalities for roads, bridges, etc.

    Lord knows we are now more aware of our crumbling infrastructure after the tragic bridge collapse recently.

    VMC and MLM are the blue chips of this sector. Buy and hold. The opportunity for them to be tradeable on a ST is just icing.

    “SAFETY PAYS”

  170. mSquare

    MU – Anyone playing it before the earnings after close today? I have stock but after the recent visit to near $10.30 interested in getting out (rather own more of SNDK). Any suggestion of a good option-strategy assuming they say good things (or at least not bad) and drive it up say to just under $12? I am not too thrilled with the Oct $12 Call as it is only $0.25!

    As per http://www.247wallst.com/2007/10/micron-braced-f.html

    Options traders seem to actually be braced for a move of up to $0.74 to $0.88 in either direction, which is insulation for a 6% stock move. These options might be worth looking at because there are over 55,000 contracts in the open interest in the closest OCT Call Strikes ($11 and $12) and over 39,000 contracts in the open interest of the closest Put contracts.

  171. Richard

    Good one, Bob. I apparently walked into an easy trap!

  172. Greg

    Thanks Quarryman – You Rock!

  173. B.B. Queen

    CAKE – are we looking to sell against it or is this a straight mo play?

  174. workdog3

    Phil,

    I’m considering a put play on TOL: Buy the Mar 08 $20s for $1.90 and sell the current $20s for $.25. Any issues you see with this move?

  175. jhok

    Many ag stocks down – DE, CNH, BG, MON, TNH, AGU, POT – did someone downgrade the sector?

  176. greedpeace

    wouldn’t wag be good if defensive rotation happens at all? might it at least retrace some fibs?

  177. bob812many

    BDC – I believe the Hang Seng is closed for the week. Holiday

    Richard – lol I stumbled upon that quote this weekend whilst chatching up on my reading. I even used whilst in a sentence…dem books r pay’in off!!

    CMON CTRP!!!

  178. Greg

    XOM breaking 92

  179. CMan

    Phil,
    FXI – FFP MD iShares FTSE/Xinhua China 25 [FXI] Jan 160 Put $11.48 Basis
    FVU VS iShares FTSE/Xinhua China 25 [FXI] Oct 175 Put $5.40 Basis
    Roll/spread suggestions please.
    Thanks!

  180. Phil

    Rolled LVS Jan/Oct $135 puts to Mar/Nov $140 puts (even)

    Hang Seng looked toppy at 23,000 – have fun!

    MU – sell the $11s and collect the .35 premium, if you get called away so what and you have .72 downside protection (6.5%). You could also get .22 in premium on the very safe Nov $11s at $1.60 but it would be pretty surprising to see them break below $10.60 and you can always roll the caller for more premiums if you have to.

    TOL – It would suck for you if they returned to $20 but it seems safe enough, just kind of dull.

    XOM and XLE failing levels in tandem – let’s be super careful here if they break up.

    Ag down due to things we discussed yesterday, ethonal glut main factor, silly reason to be down.

    PCLN – I gave up on my puts but I wouldn’t take them positive.

    WAG – not after those numbers!

  181. jhok

    Ag stocks may reacting to the bearish news from VSE – they are suspending construction of their 110 m gal ethanol refinery in Indiana. This is seen as reducing demand for corn.

  182. MJ

    no time to trade today :-(

    GS just cleared the July high of 225.77. Next stop 230s.

  183. Optrader

    BIDU-Wow! I was gone for the last couple of hours and come back to this. This is what I was talking about when I said shorts could push it in a minute. You should be very careful if you are shorting this stock. I am tempted to buy puts here but I think I am going to pass.

  184. Phil

    FXI – you were in poor position from the outset, never do those plays as they can really burn you. I’d roll the Jans back to the Feb 175 puts for $15.30 (-$6.40) and roll the caller to the Nov $175 puts for $7.50 (+ $4.50). Without giving up a month you close the $15 gap between you and your caller for $1.90, giving you a much better chance to make 2 more profitable rolls in Dec and Jan.

    Oil pumped back over $80 at the close.

  185. Richard

    Bob,

    Whilst I was reading your post CTRP was spiking up. Whilst writing this, it was falling off. Good luck with the trade!

  186. Demetrius Michael

    Back — Yah he’s okay, he’s the one that called me… It was the bus’s mirror that nailed him… We went out for lunch instead.

  187. John Oh

    anyone playing hte breakout in otex? was in IBD this weekend and was watching it but it ran away from me cause they were charing a .35 spread on the calls --

  188. workdog3

    Phil,

    I sold the LVS 135s for $7.90 and they’re currently $13.30. Would you consider rolling out to the 145s at this point?

  189. Optrader

    AKAM-Buying some calls.

  190. djczing

    Nice AKAM. Very nice.

    40% in half a day aint bad at all.

    I think AKAM is destined for at least 32.50-33 short-term.

  191. Optrader

    DJ, you are in AKAM too? This was one of my favorite companies last year. Been watching the drop, and I really like the chart today, 5MA turning up and price above. Could be a nice rounded bottom.

  192. raffy

    Phil

    Bidu condor

    Sold call 320 In the money

  193. billbigd

    CTRP=Welcome to the trip!
    VMW-kicking up

  194. jkman

    looking for one more play for the day. cant decide on anything. help me out fellas

  195. Sohrab

    Optrader,

    I owe 100 sharesof AKAM and didn’t sell it when it was $59. Now it is $30, half the price. Bought calls last month and got burnt. I wait till tomorrow to see if I should get in.

  196. Optrader

    BIDU-broke $320. The power of the shorts squeeze…I thought the target was $400 at the end of 2008, not at the end of this week LOL.
    This stock was $160 on August 16th.

  197. dday97

    Been out for a couple of hours and my GS 230/220 spread is starting to tick me off, who do they think they are?

    XOM calls in the green, if they can’t hold 92.10 I’ll sell for a 6% profit.

  198. dday97

    BIDU – trying to figure out what to do with them right now, I know I have to do something but I just don’t know what yet. They’re multiples can’t possibly hold this price, oh wait, I’m trying to make sense of it.

  199. Demetrius Michael

    IBM – My boy blue, what are you doing?!!?

  200. fotoaddict

    Phil, I sold some Oct AAPL 145 calls, originally for 6.08, now 14.3.. (and they’re past my 30 day window, so I’m free to trade them…) If you were me, would you: roll now, soon, or wait till closer to expiry.. And if rolling, what to? They’re against Jan 140s.. My gut says to pay ~3 to roll them to Nov 145s. -Peter

  201. Optrader

    AKAM-Shooting up! Well, it’s much easier to make money with calls than puts in this market.

  202. djczing

    Optrader: yeah – ive played AKAM off and on for the last couple years.

    Missed some of its big moves but caught alot of em too. Heck with as dead as its been lately I was htinking of lookin at an iron condor ! (only half kidding).

    Yeah im back in – I saw the big blocks cross the tape today and that 28 bottom looks strong. After looking at the 15m chart I bought Nov 30s this morning. If it busts above 33 I might do somethign longer term. Heck maybe GOOG will buy em or something ;-)

    Good luck !

  203. MJ

    thank you Optrader. In on the AKAM Jan calls.

  204. Fan

    Great AKAM call Optrader!

  205. Sohrab

    dday97,

    I got $95 calls. Are you planning to keep them overnight or getting out?

  206. Sohrab

    dday97,

    I mean XOM

  207. Optrader

    AKAM-I am out. Bought at $2.50, sold at $3.10. More than 20% in 20 minutes, that’s enough. Will reconsider at EOD.

  208. Brian

    My order to buy MTB Nov 105′s was filled at 4.50. Anyone else?

  209. Demetrius Michael

    IBM – LOL don’t tell me you’re trying to price in the buyout for tomorrow’s deadline… It’s been done! Fine i’ll just buy the sellers. Do you want to play? Play a little hardball?

  210. Phil

    Hey, we squeezed a dime out of those XOM calls already, not bad for a day’s work. 1/2 out for me with a stop at .65 for the rest (.10 trailing). XXX

    CAKE – give it a chance to try $25 first.

    Spreaking of giving things a chance – IMCL!!!

    Wow, what did CDWC do wrong?

    LVS – you sold them naked? Ow! Stops are pretty essential with naked sells. Personally I would roll him to 2X the $145s and then to November whatevers until Shelly floats another 10M shares so he can build a casino for people who get lost on the way to a casino. This is now officially an out-of-control industry overexpanding right in front of our eyes. At some point, if you get uncomfortable, just cover with some Jan’s and then roll until you’re even.

    I’ll be scarce thru the close, I have a CC in 5 mins.

    BIDU $322!!!!

    AAPL calls, I’d wait since once you make a move you’re frozen and you still have plenty of premium.

    BIDU – Selling $320 calls for $20.35, stop at $24 XXX for the truly insane!

  211. Juice

    Phil — I know how you feel about oil prices, but what about natural gas? What do you think of UNG?

  212. MJ

    sold some GS stock (yes stock) at 227, bought at 170 few weeks back. Hanging on to the 08 and 09 calls.

    WFR nice, up $3.

  213. Radha Pagadala

    Phil,
    I wrote AAPL 145 Oct calls, is it best to roll them to AAPL Nov 150 calls (or something else?)
    Thanks

  214. Demetrius Michael

    VMW, IBM – Soon every city will have a super computer… Who makes supercomputers?!… Homes will just have screens connected to the core’s computer…. The future is groovy man.

    I hope you are right about Google… It seems like a very well ran company, and many of their employees brag about how awesome work is… It’s just when I don’t see anything physical, it’s hard for me to valuate and be BUYBUYBUY to people. It’ll be fun to see the company 10 years from now, plus the google boys are smart as hell…. It may just work.

  215. dday97

    XOM – they held up so far but I’m watching them with a tight stop, I’ll give them a dime leeway. If they can linger above 92.10 for the rest of the day I’ll hold them. Any breakdown and I’m out.

  216. Optrader

    IMCL-I have been patiently waiting on this one, but today I like the chart so I just joined for the fun.

  217. djczing

    Heheh maybe my post about AKAM earlier this morning didnt come through. Ahh well nobody listens to me anyway.
    Be right back – need to get my spare ego outa the closet – this ones shot !

    hehehe I kid !

  218. dday97

    IBM – I think they’ll have a hard time charging their ATH until earnings on the 16th.

  219. Optrader

    AKAM-Crazy move. Looks like the good old times :) This stock can move so fast

  220. MJ

    LVS up 5, but WYNN up only 1.5, but volume sucks so probably not getting back.

    IMCL is one of those stocks I don’t like. Same category as YHOO and MOT.

  221. Optrader

    BIDU-Had to get some puts. Stop at $324.

  222. dday97

    Don’t worry Dj, I saw you this morning and I’ll give you extra credit on the AKAM call.

  223. bigduke6

    whats up with akam today? it hasnt moved that much since earnings dissapointment. whats the news?

  224. Demetrius Michael

    Is that it?… That’s IBMs big sell off?… That’s pathetic…. Little baby ran out of money??

  225. jkman

    what about LLNW as a sub-play to AKAM? dec 10′s dont look too bad

  226. Juice

    Phil — BIDU condor
    Bought the 250 PUTS with 270s sold against
    Bought the 350 CALLS with the 330s against for 8.35 credit
    So my risk is 11.65. It’s my first condor trade. Hope I don’t mess it up :)

  227. billbigd

    VMW- $91.50 $$$$

  228. MrN

    Been out has any adjustment been made to SYX – anyone?

  229. fotoaddict

    phil, re: AAPL 145 caller.. Ok, I’ll hold them for a while longer.. but when you say I have “plenty of premium”.. My math says (157.85-145) + 14.1 = 1.25 premium left, roughly 9% of the option price.. Is that plenty because it’s 1.25 per, or ?? trying to understand the thinking.. even know we’re in a no thinking zone.. lol -Peter

  230. Andrew

    I’m convinced VMW is going straight up to $150 within six months. A lot of people still don’t understand what they do.

  231. Optrader

    BIDU-Great drop! Sold 1/2 of the puts. Keeping a tight trailing stop on second 1/2

  232. Filmflam

    nothing like getting your groove back with the old standbys. Portfolio finally breaking out of a 2 month trough today with GOOG and AAPL. Plus RMBS, Plus VMW, Plus plus plus. I think this market needs a break. I think RIMM will bring it. Who cares, a streak is a streak, and it is nice to be on one again.

    Don’t know how long this easy money can last, but don’t forget to buy yourself something nice.

    And if you didn’t sell any GOOG today, you missed out. It will be good to buy in a few more days, maybe longer.

  233. jkman

    not to brag or anything but LLNW had a huge spike around the time i mentioned it

  234. djczing

    Optrader: take a look at the akam volume on the 60m.

    Makes me say hmmmmmmm

    dday: *lol* thanks !
    Actually id defer to optraders calls before mine any day !

  235. jkman

    about 2 min after to be more exact. someone in here the cause?

  236. Greg

    LLNW and AKAM both running today, competitors, both have been down due to pricing pressures, with new competition coming in their space.

  237. Demetrius Michael

    Dday – I can’t wait till the 16th for earnings.. That’ll be way too long of a trade for me. I’m just seeing if there are suits stalking phil’s forum… Measure the changes in the selected securities / etfs after I note some trades on here… It’s hard to beat me if you manipulate the markets because I just sell calls as soon I see things down ticking… Or sell puts and calls if it’s sideways… I’m just way too active. I don’t mind IBM as a play, and I figure since it’s in the Happy 100, it should have some good fundamentals… If you want a good entry, now’s a good time with under 118 as a short stop.

    Everybody’s watching BIDU, that’s what makes me scared… If I was here I would’ve played it, but now I rather play EMC for tomorrow.

  238. Optrader

    Djczing, yes, it is looking real good. I will get back in before close but with 1/2 position as we might get a pullback tomorrow. This is a big move with no news.

  239. Optrader

    Also, Djczing, sorry I missed your call on AKAM this morning, that was a great one!

  240. Optrader

    BIDU-Sold another 1/4. VERY nice 10 points drop.

  241. Bill Coursey

    made 17.3% on bidu puts in about 5 minutes….love this job

  242. dday97

    BIDU – that was fun, I piggybacked you on that one Optrader. I’m out again…for now.

  243. Filmflam

    AAPL hits 160 tomorrow on a gap open then sells off all day. I like to make predictions. It is my tragic flaw. My more tragic flaw is not acting when my predictions come true.

    Phil, thanks again for hosting such a great board, this is worth the price. At any price.

  244. irished

    IMCL=FUEGO, MUY BIEN HECHO HOY FELIPE
    Patience is sometimes the best advise

  245. Optrader

    Bill, I know, this is crazy. This volatility is just a godsend for options traders.

  246. Filmflam

    IBM – I have been holding Jan-09 120 calls since march. Whenever this thing pops over 120 it should float up to 122-123, then I will sell the front month 120 calls against it and hope for a pinning at 120. That will make them free with 12+ months to go.

    I am learning. It just takes patience and a bull market. =)

  247. Filmflam

    BBD, you selling out of any VMW yet?

  248. MJ

    damn GOOG, stopped out yesterday and today on some nov puts (-10%) and it goes down now.

  249. Demetrius Michael

    lol you bought the 120s for 3 bucks in march!?

  250. Potter

    Optrader,on daytrades such as AKAM how many months out are you typically buying?

  251. Optrader

    Daytrades: front month or one month out. AKAM was not a daytrade, bought the Novs. I just turned-out to be a daytrade when it went up like crazy.

  252. Demetrius Michael

    Congrats on the AKAM and BIDU plays… Those were amazing, sorry I missed out on those.

    SPX looks like they’re holding through close…. Tomorrow might be bullish day…

    Except
    8:15am USD ADP Nonfarm Employment Change
    Measures the number of new jobs created in the previous month, excluding the farming industry. ADP, a leading provider of employment solutions for businesses, releases this indicator two days before the official BLS employment report. ADP claims the indicator has predictive value in regard to official statistics.

    Could manipulate the opening.

  253. Filmflam

    Yeah, actually $3.50 on 3/1/07. Figured that it was due to climb to its ATH in 2008. My reasoning was there is a search algorithm that was backed in a joint venture with AMZN. Haven’t heard about it since. Really wish I would have gone with the AMZN side of that trade.

  254. Optrader

    Well, that was an amazing day again. Congrats everyone, great trades!

  255. Jonathan Parker

    anyone have thoughts on goog last hour? Crazy action.

  256. Filmflam

    Watch for lots of gaps up at open tomorrow. Got to be some profit taking (small, not crazy) soon.

  257. Optrader

    Funny how the shorts got scared on BIDU at the end and hurried-up to cover. I am keeping 1/4 of the puts overnight.

  258. Phil

    XOM – I’m out for a big dime! Not worth the overnights which could go either way, save the cash to catch a mo play and don’t forget inventories at 10:30.

    MTB – yep. Now we’ll see if they recapture some mo.

    Lots of strenght coming into the close, if that was the sell-off the bears are toast!

    Natural gas, hurricane season it through Nov but at the end of this month, if no hurricanes I think it heads back near $5.

    AAPL $145s – against what? I rolled mine To Nov $150s as he had no premium left but I still wanted good downside coverage. Sorry Foto – I was thinking of my Novembers – you should roll soon. Depending on your spread you might be able to move yourself to April as you move your caller to Nov.

    SYX doing what it’s supposed to.

    BIDU – LOL, I was counting that money and then it bounced right back! I clipped my guy for $2 so I’m happy (that’s the point with selling calls into a rally, even if it bounces back a bit, the loss of momentum leaches out some of the premium).

    Wassup with AKAM after hours?

  259. djczing

    Jonathan: Heh – goog tends to do those kinda things. Ya gotta know its gonna get 600 though – its almost a moral imperative now.

    Optrader: I almost sold OCt 30s against my Novs, but just left em naked.

    Id hate to sell against em and then get some big news this evening or something.

  260. Demetrius Michael

    AMZN – Don’t worry if you make 1 mistake a year. I make several mistakes a day!.. AMZN looks bad now, I would be shorting that if anything (Stops at 95). but ever since it broke away from it’s channel, it looks sketchy. Maybe it’ll break higher?.. Bigger maybe than IBM though….

    That’s a sweet LEAP from 3.5… If I had the patience, I would be LEAPing and selling calls like most of you traders on PSW…. I just turned sketchy ever since that bet on Bernanke… No one can comprehend how dumbfounded I was… Hopefully he did the right thing… It’s better that I lose money, individually, than America as a whole. With a little luck maybe I can recoup my losses and start making some money by year end.

  261. Radha Pagadala

    APPL oct 145 against 150 Jan 10

  262. Optrader

    DJ, good luck on those. I bought my calls back before close as well. Dangerous to sell calls against highflyers.

  263. Demetrius Michael

    AKAM – If anyone’s wondering on after hours trading: http://web.mac.com/dem_z/PSW/71002/akam.png

  264. djczing

    Op: Dangerous as heck on AKAM when it comes outa the box like this, yup.

  265. billbigd

    BIDU-I played it the other way. Dropped to $314 I jumped in on some OCT 320′s up $1.80. Still holding Jan’s. Optrader I want your put plays for sure
    Filmflam-vmw shares no. Why would I. Up over $40 on non IPO shares. Oct 80′s probably gone manana. Nap time

  266. Demetrius Michael

    AKAM – 108 lots at 29.65, I think that’s due to an acct transfers. Just bad ticks on the feed.

  267. Optrader

    BBD-Well done! Glad we are all making money, on both sides.

  268. Demetrius Michael

    Bah Goog going to 6….Screw morality, me and greed’s shorting it! Right buddy?.. You still with me???

  269. djczing

    I dont see akam trading at the moment. I havent seen anything come across the tape.

    Ah theres a trade. 12k shares. Strange — string of big blocks traded on uptick and no tick this morn too — 4.6M shares or so.

    Is it possible they are just settling up the days trade ? I see one trade for 12.2K shares at 16:21 right now…

  270. fotoaddict

    Phil, no worries, I’d rather be the attentive student catching the teacher’s mistakes once in a while than sleeping in the back row.. Ok.. so it’s after the close, but how’s this sound for a roll for me:

    from: (AAPL) jan 140s / Oct 145s
    to: apr 150s / nov 155s..

    I should be able to roll for debt $1.9 at the current prices.. -Peter

  271. Phil

    Wow, quite the overreaction from the VIX! Now much higher than it was 200 points ago (at 13,900 the Vix was at 17.50, now 18.50). That’s the sign we were looking for, even if it got there in a sneaky, back-door way, the VIX is up as the Dow is up, indicating that up may no longer be the right direction. We’ll have to keep on top of this as the weekly averages form up!

    Thanks Flim – as long as you’re having fun!

    GOOG – you have to be willing to ride out puts all the way to a “significant” number like $600 and hope for a generic pullback, they’ll probably take a stab at it tomorrow.

    BIDU scared shorts – I covered! Once I make 10% on a day trade you’re damn right I cover rather than go overnight.

    AKAM – thanks.

    AAPL roll – Absolutely, gaining 2 months and throwing your caller $10 off the money for $1.90 – take those every day and you will get very rich! Just keep an eye on it as you may need to roll him down at some point and don’t forget you can always put yourself back to Jan if it really starts tanking and you want your caller to pay for it.

  272. Demetrius Michael

    Further on Google.

    Tv ads aren’t dead… Eventually I can see them personalizing without invading privacy. If I knew a certain hotel was filled with rich business execs… it would be neat to advertise business exec’y type ads only in that hotel.

    Doing that with computers is called Adware (or spyware)… Everybody hates that. Google tries to counter with ads that are search specific…. Which works, but I think it implies revenue is dictated by use. The only thing stopping softy from messing up google is ego… but if they ever merged with ya-who? it would shake up the game.

    Imagine a microsoft, yahoo, and ebay, merge… They would be unstoppable. Clean up live.com with yahoo’s depth and we got a viable competitor. Except all the advertisements would link to products you make money on already — Ebay. All the hotmail subscribers will be automatically be ebay users…All windows users will be live searchers and ebay users… Now microsoft will have data on pretty much every aspect of your life… They could even do that Spyware thing, without having the “virus” title.

  273. Demetrius Michael

    lol yah I’m not shorting google, I was just joking… It’ll be dumb to short a stock expecting huge gains if tomorrow is an up day.

  274. CMan

    Phil,
    AAPL: Do you still have Apr/Nov 140s & Jan/Oct 150 spreads?
    Thanks

  275. greedpeace

    google was struggling with 570′s. phil laughed at me. i can’t read some of this action in the leaders recently other than straight up no matter what. i am reluctant to be late long and burnt short. i don’t understand the forces at work here. these stocks have not pulled back much at all. those charts all look like moonshots. i understand the cycle of paying up for growth but not even much profit taking.

    i was short fxi shares from 158′s to 156′s. thankfully i was afraid to hold that overnight. i bought october 60 puts on uso 2 weeks ago and got out early.

    i don’t know what to do lately. that’s why i’m here. there has to be a down day here somewhere. is there a term for frustrated long going short?

  276. biodieselchris

    I use gmail a ton and their tailored google ads are right on the money. I’ve been clicking them more and more lately.

  277. rahul

    Phil – What’s your short term outlook on BIDU? I own the stock and long Jan 310 Put and short Oct 300 Call and short Oct 290 Put. Does it make sense to roll the caller up to 320 for $9?

    I can’t see how it can move any further without a pull back, but then I didn’t expect today’s action either. If I’m reading the stats correctly, there were approx. 3M shares short, more that 15M traded today and only 33M shares outstanding?

  278. Richard

    I find them spooky. Maybe I’ll get used to them, but I’m not so sure. I’d rather play their stock than have their ads in my face, especially the ones based on the content of my email. I’m laughing as I imagine where that is headed (for some of my “interesting” emails.)

  279. Demetrius Michael

    Greed – don’t take it to heart… Phil was just saying google is a train…

    You can’t just say it’s a downtrend without any reason than it’s bouncing around… I can see why you thought it was a rounded top, but you need atleast a some confirmation before you speculate.

    Here let me give you a run down of technical trading.

    Lets take Google for example.
    You’re probably looking at candle sticks so the rounded top looks even more prominent… Next time try and look at bar charts when you’re doing technicals… Here’s a Candle chart that you’re probably familiar with.

    http://web.mac.com/dem_z/PSW/71002/google.png

    This is what I was thinking:

    9/20 – “When will this Bullish trend stop?… Maybe it’ll double top *draws 1st white line (the bottom one)*”
    9/21 – “Broke through, free running from here now *buys calls*… Google hits a high of 571.5, not bad. Stops on white line”
    9/25 – “Lower opening, stops are tight, another bullish bar, but doesn’t break last high. Getting ready to liquidate at profit”
    9/27 – “Hmm, 3 times it failed to break 572… Is this a top?… Draws the top white line here… *Liquidates out of calls*.”

    9/28 –

    You: “Looks like a rounded top.”
    Me: “Why is it a green bar? Might go for another round upwards… Might be a rounded top though, lets find some confirmation of this before we start selling… *draws yellow line*”

    10/1 – “Broke through again, *buys calls*”
    10/2 – “This is way too bullish, rounded top on intraday… it’s forming a pin, *sells calls*”

    Do you get it?… It’s hard explaining over the internet, but hope that helps…
    Look at this bar chart… Does it still look like a rounded top?
    http://web.mac.com/dem_z/PSW/71002/googbar.png

    Cheers buddy!

  280. Demetrius Michael

    Biodiesel – I think I’ve clicked on an adword once…by mistake… If you have the choice to view an adword or not, would you?… If you say no, then you’ll be in the growing population that uses ad-blockers. My question is how many of us would actually say “yes, I want to view advertisements”… Granted google advertisements are less annoying than regular ads, but they’re still annoying.
    https://addons.mozilla.org/en-US/firefox/addon/10?id=10

    Interesting emails eh?… Google should’ve bought out youporn.com instead… Larger market. Interesting topic to shareholders too.

  281. greedpeace

    dm,

    appreciate the response. today’s goog candle looks like a near term top to me but i’m obviously gun shy and i’m sure there are better risk/reward puts to buy.

    it seems to me that the only thing that might cause a pullback in the indices would be a reversal in the dollar. oil/gold/metals/commodities had a shallow pullback today and the dollar was ever so slightly greener

  282. MJ

    Why does CNBC despise Citibank’s current CEO so much, that they have to keep repeating that he has to quit like 10 times every hour?

  283. Filmflam

    Demetrius, a msft/ebay/yhoo merger would not be unstoppable, it would be unstartable. Not one of them can execute. So many laurels, so much resting…

  284. Demetrius Michael

    Yah, it would never happen, but.. I guess that’s the only real attack against Google that I could think of…

    Google may pull back, but I wouldn’t bet on it until I start seeing it break close with some down bars. Despite the shit talking, they’re a monster of a company…. A lot of hype, but they do live up to it.

    There are funner plays out there though, we don’t have to over work a particular stock.. I rather place some buy orders on Google for upside rather than puts on the downside. I’m sure the google boys play that stock, and they’re not stupid. Most of the downsides are on traps, unless it’s channeling.

    I mean if I had a Trillion to play with, I would mess up traders. Especially the cocky ones that want to short my company.

  285. Filmflam

    greed, I am just coming out of the funk you are in. This is the thought that made me go long right after the fed. The fed is clearly on the side of the stock bulls. The twice bailed out the bulls. Once on expiration, and once with a strong cut when they had talked up the other side. Why are they doing it? I think it is because we haven’t had any retail participation. The fed will be on the markets side until the deep pockets can get rid of some of their stock.

    I now think that they fed is going to keep dropping rates, making the ARM loan resets less of a factor. That plays into my theory of a flat top for the housing market. Eventually, something will give and we all go down.

    But, no one can talk you into a mindset, nor should they. Just keep a lot of cash and focus on getting a string of good trades.

  286. Seattle

    IMCL up significant after hours, plus it also received favorable FDA comments:
    http://biz.yahoo.com/prnews/071002/nytu180.html?.v=1

    The interesting thing is that this news just came out 5 minutes ago. Glad I Double Downed on this one! Any predictions on where it will start trading tomrrow? Is it better to sell 2/3 out right or just cover for October?

  287. MJ

    tom2oc’s latest post … http://tom2oc.blogspot.com/2007/10/102-eod.html

  288. Phil

    AAPL – I think I have pretty much every possible spread on them at this point!

    In the LTP I’m still sitting on J/N $150, J2010/Oct $155 & Apr $155/Oct $150s

    In complext spreads I have the J2009 $150s/Oct $145s & J2010 $140s/Oct $145s

    I didn’t want to roll most because I do expect a pullback. Earnings are after expiration so the Nov calls will hold their value far better than the Octobers, which means you’re taking a big step back giving up on the Octobers so I won’t do that until Apple’s over $160.

    Don’t worry Greed, it’s just that kind of market right now, unfortunately things will only really start to make sense when we drop 1,500 points and everyone can say – “Gee, that housing crisis sure is a crisis.” Until then it’s irrational exuberance on a scale even my 7-year old questions (she likes to come in and roll through my screens and look at the graphs and she’s noticed lately that nothing goes down anymore and she thinks it’s broken).

    GMail – It certainly is reassuring that someone is reading every message you send and receive so they can decide what you want. I hope it’s not too scientific as my mailbox is generally stuffed with penis enlargement ads!

    Speaking of Apple, the new Zune is an IPhone with a touch screen etc… This could be one of those great chances to get in on Apple again if they retest $150 because traders rarely differentiate the quality of a challenger when they first get announced.

    Short-Tem BIDU – well I did a naked sell on the $320s yesterday for $21 but they scared the crap out of me with a huge volume bounce near the close so I lost my nerve and bought them back for $18. In retrospect I should have just shorted them as I would have been more willing to take my lumps (as I would DD or roll, something that’s not fun or smart with a $320 naked caller). I REALLY think $320 is out of control for them, pushing a $10B valuation (p/e 200) for a company that pulled in just .26 per share last Q and will be lucky to break $1.10 for the year. Even if they triple next year (not projected), you’ll be looking at (assuming they stay flat) a p/e of over 100 at the end of ’08. It would take an uniterrupted tech rally of biblical proportions for them to keep going at anything near this pace.

    My call side play on BIDU is now the Dec $330/Nov $340 because I got blown out of my original Jan $300/Oct $280, it was a 2x roll for almost no cash so I’ll be stuck there for a while hoping BIDU goes down but not too far down. For your position, I’d keep tight stops on the puts you sold short or take some off the table as you must be way ahead and I’d wait for a nice dip to put a stop on your caller so you can roll him while he’s down (you’re in better shape than I was and there’s always November).

    C – that is an interesting vendetta they have going there. Probably becuase C is GE Capital’s largest competitor for corporate loans. Revenues at C have gone from $54Bn to $96Bn since Prince took over and net is up from $17Bn to $21Bn but the bank is in a heavy investment cycle over in Asia and has established themselves as the top foreign bank (unlike GE, who dragged their feet). By constantly calling for Prince to “return more cash to investors” what CNBC is saying is “stop investing in the future.” Ah, there’s nothing like controlling the media is there?

    So many laurels, so much resting – good one Flim! A media company needs to buy Yahoo before Google buys a media company (DIS?) and screws them all. It’s a logical move for GE and would be in-line with Murdoch’s general m/o (but he’d have trouble as he digests DJ), CBS is clueless and TWX won’t go that way after the AOL debacle.

    Wow, IMCL up huge!

    Tom is so good! We absolutely need to keep focused on the BKX/XLF for a sense of direction today.

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