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Thursday, March 28, 2024

TGIF!

Great VideoCan we finally stop the madness?

This has been one of the most ridiculous weeks in the markets I can remember.  It's been very tough as we hung onto positions and spent a lot of money buying out our beaten down callers and then going into yesterday's close without new covers – very painful but, as I've been saying all week, it's like walking through Wonderland – everything is going crazy and it's easy to get sucked into the madness – the only logical thing to do is follow the rabbit (our trading plan).

We're waiting for Uncle Ben to tell us about "Financial Stability" at 10 am but our bets are already made as we jumped all over the financial meltdown and laughed off the "oil rally" for the farce that it is.  We are heavy long in GOOG and heavy short in SU in the Day Trading Portflio along with our UYG calls so that's the best indication of our stance for the day.  It's almost the exact opposite of Cramer's advice in yesterday's mid-day Mad Money segment but I think most of the members were with me, taking a stand against the madness that's been moving the markets this week. 

We have not been this invested AND this exposed in the LTP since last summer's melt-down so I really hope we got the timing right.  If not, we have a 100-point cushion before we get back to where we uncovered in the morning so a re-cover will not be so terrible and these are the kinds of chances you should take if you have conviction in your positions.  Right now (8 am) it does look like we're going to get a nice open but that changed since I went out for coffee from a flat open at 7:30 so who knows what will happen 90 whole minutes from now.  I'm still looking at 11,450 as a must hold on the Dow and 8,300 on the NYSE.  It would be nice if the Nas can get back over 2,400 but if it isn't led by the SOX moving up off the 360 line (50 dma), I don't want to know about it…

Asia didn't want to know about Financial Stability this morning as the Nikkei fell another 86 points to 12,666 and the Shanghai Composite closed down 1.7% at a pathetic 256.  The Hang Seng found a way to hold 20,000 as the market was closed for a Typhoon and they remain 392 points above that critical line which, at an average loss of 250 points a day this week, they were in real danger of hitting.  Pakistan dropped back below the critical 10,000 mark as terrorist activity stepped up in that country, losing 2.3% on the day's trading, down 33% since April.  All of Asia is at that critical 33% mark so next week will be very important there but a turn up in our financials should rally Japan and begin to pull Asia back up with it.

Uncertainties over the U.S. credit woes and the Chinese economy, and increased stock selling by foreigners continued to weigh on investor sentiment, pushing most investors into a wait-and-see stance, said Kim Joong-Hyun, an analyst at Goodmorning Shinhan Securities.  "Investors seem to have almost given up on hopes for stocks for now," said Samsung Securities' analyst Oh Hyun-Seok. Among decliners, most major exporters extended losses from the previous session due to concerns about global economic condition, said analysts.

One bright spot over in Asia is a report that TV sales continue to be very strong.  This is good for our outlook on semis as well as our long-standing TXN positions as well as our new SNDK play that we took for the small virtual portfolios yesterday as the economy may suck but consumers still feel they get the most bang for their buck out of TV's and IPods, the perfect diversions for people who can't afford to go out and have to sit in their devaluing homes…  Even computers are doing well as record Mac sales did not dent HPQ's sales figures and US corporations have put off major IT purchases for almost a year now so look for a serious spike in spending IF the economy starts to turn up, even just a little (good for our MSFT too!).

Speaking of IPods, ITunes customers in China were unable to download songs this week and an activist group claimed Beijing was tryig to block access to a new Tibet-themes album but I think it was the same song that was banned in many Muslim countries:  Katy Perry's "I Kissed a Girl."  Meanwhile, Chinese activists should be careful about who they complain to as two turned up missing just before the Olympics.

Europe is looking downright kissable at 9am with 1.5% gains across the board despite the UKs very flat GDP report.  Oil is back to $119 in pre-market trading and airlines and auto makers are leading the charge in Europe.  We noted the airline action in yesterday's chat and I still like selling those RYAAY $25 puts for $2.50.  UK ad company WPP posted a 14% gain in 1st half profit and revenues sooooooooooooooo – Go Go Google!  (see how these things all connect…)

So everything is proceeding according to plan, it just would have been nice if we didn't have to wait all week to get going but it's a very long way to expiration (4 more weeks) and just because the markets are going our way today, doesn't mean they won't move against us tomorrow so let's keep on our toes and remember to take a little off the table as we head up (see comments on rolling profits in last night's LTP review).

Have a great weekend,

– Phil

 

 

 

 

 

 

 

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