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Will We Hold It Wednesday – NOW It’s May

SPY 5 MINUTEYesterday did not count.

Until the end of day, the volume was low and, as you can see from Dave Fry's SPY chart, the morning pump was mostly erased by the end of the day.  In fact, on the Russell and Nasdaq – it was entirely erased.  What a friggin' joke, yet no one will investigate it and few will even question it.  

As we often say at PSW – We don't care IF the game is rigged, as long as we know HOW the game is rigged and get to place our bets accordingly.  In my Morning Alert to Members at 10:05, my comment on the move up was: 

Not too many markets are open so super low-volume means we can pretty much ignore whatever's happening.  Some wild gyrations at the open already with AAPL popping $10 to goose the Nas and they are spiking us up and down at will on this low volume.   

At 12:02 we made our planned adjustments to our 4 active virtual portfolios, taking advantage of the big, bad spike to move to cheap June bear positions and cash out our long plays and just get generally more aggressively bearish at what we thought was going to be the top for the day.  The most aggressive move was made in our most aggressive, $25,000 Portfolio (pictured here from its 10am status BEFORE many changes were made), where we flipped our protective TNA hedge  from bullish to very bearish – shifting the balance of the portfolio much more bearish with a single move:  

TNA – $60s are now $4 so let's take that and run on 5 (1/2), as that's more than we paid for the spread and we'll ride the $63s half-covered with a stop on 5 at $3 (now $2.25).  Also, a stop on the 5 remaining $60s at $3, at which point we would reset the stop on the $63s, of course. 

Needless to say, that trade worked out huge already as the $60s all stopped out at a $3.50 average ($3,500), which is $500 more than our max potential gain on the spread and the $63 calls already finished the day at $1.10 ($1,100) for a net of $2,400 (so far) off our $1,450 entry on 4/26 – so up 65% in less than a week on the trade we used to protect our bearish bets during the little rally we expected.  

After hours, Members celebrated a huge win with PLX, who got approval from the FDA for Elelyso, something Pharmboy, who also writes a regular Biotech Investing column at Stock World Weekly, called to Members' attention way back on March 3rd (along with several other excellent picks):  

Protalix (PLX) – FDA review is in May, and I like the prospects of them getting a thumbs up.  I have owned shares in PLX for a very long time, and their technology is sound.  Pfizer will help PLX sell their main enzyme replacement therapy, Taliglucerase alfa (this enzyme is part of the reason Sanofi bought Genzyme).  PLX has a proprietary manufacturing technology which will give them an edge on pricing and thus garnering market share.  With Pfizer's sales force behind them, I like PLX's chances.  The technology is also transferable to many other disease treatments, so this is a long term holding in my portfolio.  To play the FDA, I like the May $5/7.5 bull call spread for 80c (buy the $5 calls, sell the $7.5 calls), and sell the April $5 puts for 40c.  IF the April $5 puts expire worthless, the bull call spread price cost basis is reduced to 40c.  That means the maximum loss of 40c, or a maximum payout of $2.10.

PLX shot up to $7.91 last night and that trade is looking good for the full 525% profit potential so congratulations to Pharmboy and all the Biotech players at PSW!  

Since last Monday, we've made a lot of picks in both directions.  As we bid a fond farewell to our longs, we should review our status and see if there are any opportunities to go back to the well ahead of what we expect to be a fun week of selling for the markets (in order of selection by day, does not include Member Portfolio moves).  

Monday Market Meltdown – Global Wheeee Edition (April 23rd):  

  • CAT May $95 puts at $1.05, now .50 – down 52% (gone after earnings) 
  • DXD May $12 calls at $1.35, now .65 – down 44% (still playable) 
  • CHK at $17.20, now $18.05 – up 5%
  • CMG June $375 puts at $5, selling May $475 calls for $4.75 for net .25, now net $2.95 – up 1,080% (was 1,860% when we killed it after earnings).  
  • UUP May $22 calls at .17, now .09 – down 47%
  • EDZ May $14/17 bull call spread at .80, selling $13 puts for .65 for net .15, now net -.05 – down 133% (playable for the .05 credit).  
  • TNA Weekly $55 calls at .85, expired at $5.70 – up 570%
  • FAS May $80 puts sold for $1.65, now .28 – up 489%
  • (2) TQQQ May $103/110 bull call spread at $4 (now $9.22), selling (1) ISRG Jan $350 put at $4.40 (now $3) for net $3.60, now $15.44 – up 328%
  • AAPL Weekly $575 calls at $20.75 (out at $39), selling May $590 calls for $22 (now $11) for net $1.25 credit, now net $29.25 – up 2,340% (so far)
  • QQQ May $63/66 bull call spread at $1.90, now $2.47 – up 30%
  • EDZ May $13/16 bull call spread at $1, now .50 – down 50% (still playable) 
  • NFLX complex earnings play – too complicated to summarize – did very well.  

That was a very busy day, as it often is when we call a turn (we flipped more bullish into the end of month).  As you can see, we try to balance with trade ideas on both sides as we really hate to be more than 60/40 in either direction and, amazingly, both bull and bear side trade ideas did fairly well – even without timing our exits (as we're just reflecting the current price as if they were left alone).  

Tempting Tuesday – As Usual

I led off the Tuesday morning post saying: "Clearly, from the recent sell-off, we have a whole lot of bouncing to do…  As we expected at the time, we made it to our 1,384 level on the S&P and then failed to hold it and now we come in for our 2nd tests of our 3 significant levels – 1,360, 1,372 and 1,384 – that's our range until it breaks and THEN we can make some directional bets.  In this market chop, our best strategy has been to bet both ways."

  • BWLD (3) Sept $90 calls at $5.80 ($1,740), selling (5) May $85 calls for $3.60 for net $60 credit, now $510 – up 950% (so far) 

That was it on Tuesday – what a difference from a busy Monday!  See how good we are at resisting temptation?  

Whipsaw Wednesday – Apple Today Keeps the Fed at Bay

AAPL's earnings were great but Durable Goods was a disaster and my suggestion was to have IPhones and IPads reclassified as Durable Goods – Economy fixed!  My comment on the situation in the morning post set the tone for the next week's action:  

Can we survive 2 more months without another shot of QE?  Doubtful, the bulls are already jonesing really bad and, as the great Gator explained, "I really hate having to resort to knocking older people in the head to get their money – but I'll do it – 'cause I'm a crack head!"  The investing class is just as hooked on free money from the Fed as Gator was on $20s from his brother and they are just as willing to destroy older people's retirement accounts in order to get another hit from the Fed's Free Money Crack Pipe. 

  • DIA May $127 puts at .80, now .35 – down 56% (we moved to June hedges yesterday)
  • (2) SQQQ May $11/12 bull call spread at .30, selling (1) $11 puts for .45 for net .15, now net .05 – down 66% (I still like this at net .05)
  • GLW 2014 $12 buy/write at net $9.03/10.52 – on track. 
  • GLW 2014 $10/15 bull call spread at $2.75, selling Jan $15 puts for $2.10 for net .65, now .97 – up 49% (also, on track) 
  • PCLN July $580 puts at $9.60, now $7 – down 27% (we're in the $620 puts now)
  • UUP May $21 calls at .90, now .85 – down 6% (will be back up this morning)

Federally Fueled Thursday – QE Maybe?

I put up our famous Multi-Chart with our predicted 50% bounce levels (that may be back in play going the other way shortly!) and my comment on the situation was:  

We ARE willing to go technically bullish but I see death crosses – EVERYWHERE – as the 50 dmas fall below the 200 dmas and that, my friends, is NOT a bullish sign.  Since the last time we looked at our Multi-Chart on the 16th, when we warned that the "miraculous" move up was masking overall downward momentum, those 50 dmas have now fallen below our 50% lines – also not a good technical sign.

Yesterday we wondered how many fools would rush in and buy as Bernanke and Company play the same old song and dance – again – and the answer, so far, is not too many as the volume was crap and the movement was crap.  We'll see if the bulls can pull one out of their hats into the weekend but we'll be leaning bearish if we can't hold 3 of 5 of the US indexes  over that 50% mark.  

I can't imagine, this weekend, what's going to change that will make Euros and Yen more attractive. 

  • 3 AMZN July $220s at $4 ($1,200) out at $22 ($6,600), selling 5 May $210 calls for $2.15 ($1,075), now $21 ($10,500) for net $125, now net $3,775 – down 3,020% (obviously, we'll be rolling the short calls!)
  • BAC Jan $7.50/10 bull call spread at $1.08, selling $7.50 puts for .82 for net .26, still net .26 (playable)
  • TNA May $57/62 bull call spread at $2.70, selling CHK June $17 puts for $1.25 for net $1.45, now $1.77 – up 22%
  • Jackie's Picks (take your daughter to work day) – SINA, AAPL, DIS, ASNA, MCD, CNK (she also called the Swiss National Bank incompetent).  

That AMZN trade is a great illustration of how leverage can bite you in the back but we're confident that AMZN will not sustain $220, otherwise we would not have made the trade in the first place.  Our gamble was the issues would show up in earnings, which they did, but a little bookkeeping magic kept the issues we see from being realized this quarter – though we quickly bailed on our longs.  

EWJ WEEKLYThank GDP it's Friday – Reality Check?

My comment to Members in early morning chat (where we had a great discussion of market manipulation in general) was:

I still just want to short everything.  My only reaction on Monday if we open down 500 points will be to kick myself for not shorting the crap out of this rally but it's just too crazy to make uni-directional bets.  It's the last week in April next week and if the "sell in May" crowd want to exit at good prices – this is exactly what they need to do – spark a BS rally, have Cramer scream BUYBUYBUY until the retailers think they are missing out and then, when the sheeple move in – the funds move out, right on schedule in May.

In the morning post I asked: "Will the GDP be bad enough to be good?" and it was.  I think we did pretty good on our morning prediction as we pretty much nailed our exit points yesterday as my Friday morning targets for this QE Maybe Rally were:  

We've already had a few hours of extensive conversation about the economic situation in Member Chat so let's just focus on how we can play the next half of the retrace back to our highs at Dow 13,300, S&P 1,420, Nas 3,200, NYSE 8,300 and Russell 850. 

As it turns out, we topped out yesterday at Dow 1.333. S&P 1,415, Nasdaq 3,085, NYSE 8,210 and Russell 830 – a bit disappointing, no wonder we took the bullish money and ran at noon!  

  • PCLN July $600 puts at $8, now $9.25 – up 15% (still love shorting PCLN) 
  • AMZN May $220 calls sold for $9, now $12.75 – down 42%
  • CHK Jan $12.50/17.50 bull call spread at $2.95, selling $14 puts for $1.80 for net $1.15, now $2.66 – up 131% (may be available again on disappointing earnings) 
  • HOV Jan $1/2 bull call spread at .60, selling $2 puts for .60 for net $0, now .05 – up infinity (still playable)
  • HOV Jan 2014 $2 calls at .65, selling Jan $2 puts for .60 for net .05, still .05 (still playable)
  • TZA Oct $15/21 bull call spread at $2, selling CHK Jan $15 puts at $2 for net .15 credit, now net .50 – up 233% (still playable if CHK falls today) 
  • HPQ Jan $23 puts sold for $1.85, now $1.65 – up 10%
  • IMAX Jan $20 puts sold for $2, now $1.80 – up 10% 
  • (10) FAS July $109/119 bull call spreads at $4 ($4,000), selling 5 Oct $65 puts for $4 ($2,000) for net $2,000,  now $1,400 – down 30% (still a good upside hedge).  
  • HOV Jan $1.50/2.50 bull call spread at .45, selling $2 puts for .55 for net .10 credit, now .05 credit – up 50% (still playable with smaller credit) 
  • AMZN Oct $175 puts at $5.40, now $5 – down 8% (still playable) 
  • USO June $38 puts at .69, now .60 – down 13% (still playable) 

Another busy day on Friday as we once again prepared for a turn.  That was the end of our quarterly free pick week and Membership is once again closed but I'm sure we'll do it again in July for those of you who wonder what it is we do all day at PSW.  Overall, we're had 18 winners and 14 losers with 3 even so far but the bullish winners are off the table and our mostly bearish losers remain in play and hopefully a lot of those losers will turn around.  

If the markets do hold up – aside from being very surprised, we'll be adding more bullish picks – starting with that FAS trade as QE – if it happens, will give a huge boost to the Financials.  

Meanwhile, we watch and wait to see what sticks.  Europe has been plunging since the open this morning and we're looking to open weak but it's a long way down just to get back to our Must Hold lines and, until those break, hope springs eternal for the bulls


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  1. lunar

    stj,  what is the website you mentioned where one can look up average moves after earnings for a stock.  thanks in advance.

  2. button

    Pharm,
    Thanks for PLX!  That is a nice boost to my portfolio this morning.  I plan to sell some shares into the initial excitement, however how do you like PLX as a long term hold?  It seems the tight relationship with Pfizer should boost sales and maybe result in a merger at some point.  Your thoughts?

  3. stjeanluc

    Lunar – Bloomberg publishes a list every day. It's not comprehensive but they usually list the most important ones. Yesterday's list is at:

    http://www.bloomberg.com/news/2012-05-01/implied-stock-price-moves-for-u-s-companies-reporting-results.html

    To see the new one, all you need to do is change the date in the address. For example 2012-05-02 for today.

  4. stjeanluc

    Oil Lines

    R3 – 108.83
    R2 – 107.63
    R1 – 106.79
    PP – 105.59
    S1 – 104.75
    S2 – 103.55
    S3 – 102.71

    PP has been holding all morning so far. But I see weakness in my indicators. Of course, we have the report at 10:30 AM so be careful until then.

  5. Savi

    Pharm—Thanks for plx—plan to sell some stock this morning and sell some puts on any pullback —-on nsph--i have a small position but waiting to add under 1.50
    Thx again

  6. dpastramas

    Wow CHK really takes a beating…-10% Pre market

  7. stjeanluc

    Hard to gain confidence after the numbers released this morning:

    China HSBC PMI Mf'g – 49.3 / probably more reliable than the official number!
    Switzerland PMI – 46.9 (51 expected)
    Italy PMI Mf'g – 43.8 (47.1 expected) / Austerity not working well in Italy…

    France PMI Mf'g – 46.9 (47.3 expected)
    German Unemployment Change – 19K (-10K expected)
    German PMI Mf'g – 46.2 (46.3 expected)
    Euro-Zone PMI Mf'g - 45.9 (46 expected)
    Italy Unemployment – 9.8% (9.4% expected)
    Euro-Zone Unemployment - 10.9% (10.9 expected)
    USA ADP – 119K (170K expected)

    I guess it's all so bad, it might be good…. When you see Italy's PMI at 43.8, it show a deep contraction. Even Switzerland is feeling the heat now. Export numbers in Germany are also showing weakness as their European customers shy away from buying BMW and Mercedes. Apparently the payments might be too much when you are unemployed!

  8. stjeanluc

    CHK / Dpas – That's what happen when you miss…

    Maybe should have sold in the McClendon's excitement yesterday. Funny they released that piece of news a day before they miss – which they knew about I am sure. That smells manipulation as they pushed the stock higher knowing that the earning miss would be sold on. I am looking for another Nat Gas play myself! 

  9. newt

    CMG- I have a few of these  Jun $375 puts left from the other day.  What should I do with them? Roll? Hold and see? Anything else I should be thinking about?

  10. terrapin22

    Pharm / CNDO – do you know anything about this stock?  Coronado Biosciences, Inc.  

  11. Burrben

    Just a reminder, MONEY POWER WALLST, Pt 3 is now online on PBS.ORG.  You can watch it online, or save it for future offline watching with the program, StreamTransport.

  12. Pharmboy

    PLX players – I cannot argue for taking some profits off the table.  I am covering my stock with various strikes, some I noted in yesterday's chat here.  I am also selling the May $5 puts and possibly $7.5 puts.  I want to let it settle down…..

    CNDO – Yes I have heard of them, and I love this, "porcine whipworm for the treatment of autoimmune diseases"….that is their main biologic.  I need to look more into them, pipeline, how it works, etc…..but I would not go anywhere near them just yet.

    PP for today:

  13. Pharmboy

    One things I will say to all the new members here is that playing options was taught to me by yours truly…Mr. Phil.  So that PLX trade was something that I learned over time from studying here.  Reducing the basis for our stocks and buying spreads by paying for it with other things (selling puts in solid companies, etc), is not intuitive. 

    So, if you are new to the board, over the past few months, be patient…..there are plenty of plays noted both here and on other sites.  Just study the trends of the stock, use rules that work for you (and stick to them), and start with small positions……

    OK, enough preaching, and shots are on Zero today!

  14. newt

    Happy anniversary Operation Neptune Spear!

  15. yodi

    Phil, CF we have discussed this one before. I hate to be left still with a short caller on this play holding now the May 12 175C sold for 3.90 up to 21.07 still about a 1$ premium but. Rolling to Aug 210C and selling a Jan13 160p would give me an even break but still land up with a naked caller. Playing with the idea of buying a Jan13 call for 33.20 paying 17.76 of premium while receiving 9.40 of premium in Aug. with two rolls to Jan13. What you think. I hold an other bull play in an other acc which is by now 3X as much up as this one in this left over is down.
    I am not crying as in overall I would be still up 3,600.00 on this play if I would close today.
    I hear you “greedy” but hate to give money away on a caller

  16. Pharmboy

    CHK – NOW I am buying 1/4 entry right in here….stock of course.

  17. Pharmboy

    Fed's Plosser says Fed's balance sheet has grown so large, it will be difficult to shrink it when the time come….

    Great kahuna Batman…ya think?

  18. hoss18

    CHK manipulation? Really? ROFLMAO, like anyone gives a rats a** about manipulation. Anyway, problem with CHK is the management. They may be sitting on the best assets in Nat Gas in US, but they have three strikes against them from mgmt perspective IMO.

    In 2008, Aubrey borrowed himself into near oblivion pumping the stock and had margin call city nearly bring him down in the fall from 60 to 15. (all the while he was a shining star on Cramer’s show). Then, in 2010 he got the board to buy his antique map collection for $12M. Good deal for him, but makes me wonder just what color the sky is in that board room.

    And now, the sweetheart deal on well ownership the has drawn the interest of the SEC. Really? An investigation? GS, MS, JPM etc can practically bring the world to its knees and Aubrey manages to get the SEC to quit watching porn long enough to look at CHK?

    So, I cant be shocked that they missed the barn last quarter. Sorry, just can’t play a company with that kind of mgmt style.

  19. stjeanluc

    The May 108 calls are already showing a 50% profit. Might make sense to either take the money or roll them lower.

  20. stjeanluc

  21. stjeanluc

  22. sagemm1

    Phil/CHK
     
    DO you still maintain your buy on these guys seems now Aubrey may get in some trouble, would you hold CHK through this?

  23. Pharmboy

    Wanna fun play…..this one is for our friend BDC…JNK May $39 Ps for 15c.  Let's hope the Junk collapses…..

  24. exec

    Phil/AWOL

     
    Any idea where JR's been?
     
    I'm still holding my F Jan 13 12.50 calls now up 65% and was thinking about selling some Jan 13 11$ puts.  Thinking we'll get a bounce of 10$.  What do you think?

  25. Pharmboy

    Markets are strongest when they are broad and weakest when they narrow to a handful of blue-chip names

    Hence, why breadth and volume are so important. Think of it as strength in numbers. Broad momentum is hard to stop, Farrell observes. Watch for when momentum channels into a small number of stocks ("Nifty 50" stocks).

    - Bob Ferrel's Rule #7

  26. stjeanluc

    Please let me know if I missed something as yesterday was quite busy with adjustments!

  27. threeputt

    CHK
    I missed the inital trade in the $25KP.  Is this worth taking now after earnings?

  28. sagemm1

    Dow just lost 13200

  29. Phil

    Good morning!  

    I'm off to Vegas at noon so brief comments for the most part!  

    Same BS as usual at the open, AAPL jammed up makes the Nas jump up and other indexes follow while someone ditches the Dollar but the Dollar held 79.25 today and doesn't look very weak.  

    Euro failed to hold $1.315 (now $1.314) and Pound failed $1.62 ($1.617) with the Yen at 80.16 and EUR/CHF at $1.2015 – their new home.  

    Oil is $105.75 and probably won't sell off unless we don't get the 5Mb net draw that is expected.  Gold is $1,650 as QE gets less and less likely looking, silver $30.50, copper $3.77 was harshly rejected yesterday from our Globally bullish $3.85 line.  Nat gas falling back to $2.32 from $2.36 and gasoline will not give up $3.10 (our long line on /RB), now $3.102.

    As I said in the morning report, I love (10) FAS July $109/119 bull call spreads at $3.55 ($3,550) now, selling (5) Oct $65 puts for $4.20 ($2,100) for net $1,450 now as an upside hedge.  See above for other bullish offset ideas – especially CHK, as they are down again at $17.17 during their CC.  Keep in mind CHK is likely to have a rough summer as Nat Gas keeps building and the pipelines fill up.  

    Overall, still very bearish and expecting to see 12,700 by next week – unless there is some kind of CB intervention, of which there is only a 66% chance.  The French elections are Sunday but why am I getting so ahead – I'll be here tomorrow from Vegas – I'm just missing this afternoon…

    Ah the silly pump job is fading already – I'll do some news in a while but Q&A first.  

  30. rperi

    Phil, I am looking for suggestions to adjust a RIMM play I have been rolling and adjusting since before I became a member last year. Back in December you suggested:
    "It’s too annoying to put more money into but too good to walk away from at this ridiculous price so I’d take $13,500 off the table and pick up 2013 $5/13 bull call spread at $5.35 ($10,700) and sell 2014 $10 puts for $2.30 ($2,300) for net $7,400 with an upside potential of $16,000 and that gets most of your money back if RIMM just holds $13 through next Jan.  That way, you have $6,100 on the side and your worst case is having to buy 1,000 shares of RIMM for $10 ($10,000) so you risk another $3,900 to get even at a much lower strike."
    I liked the idea, and at the time I was long 2 short Jan $27.50 so I bought 2 Jan $5/13 bull call spreads and rolled the $27.50 puts down to 3 $22.50 puts for net $2.75.  The puts are now $9.75 and I am net $2.18 on those three.  I bought the bull call spread at $5.20 and it is now $5.78 so I am on target there, but I have given up on wanting to own RIMM at $22.50 and am asking for your opinion on a positive step to take.  I don't see RIMM going out of business, but a 73% increase in stock price by January seems unlikely.  I was playing for a buyout at $20-25 per share, but that is looking less likely as well.  If I get out of the short puts now I would take a $2,270 loss, with a $1,050 potential profit on the spread.  Is there a better alternative? TIA

  31. stjeanluc

    CHK / Hoss – Strong words early in the morning…

    I pointed out last week following the Rolling Stone article that I had little confidence in these guys. McClendon runs the place like a private company with disregard for the shareholders. It's not going to end well for one of the 2… 

  32. cslanson2

    Phil,
    I think that CHK will still be in business eight (8) months from now. Based on that belief, I sold the $5.00 strike Jan/13 Puts for $0.26  -  The margin requirement at TDAmeritrade is $82.00 per contract which by my calculation is a 30% return on margin (40% annualized) and in a worst case, I'll own CHK at $4.74 per share in January.

  33. hoss18

    Sry StJ didn’t mean to be too strong, should have had my coffee first. Just skittish with CHK now.

  34. kustomz

    What to do what to do, O yea buy bonds!!!

  35. dpastramas

    PLX / Pharm – Again thanks for tipping us on PLX. I closed everything and went out right at the bell. I see the stock is slowly deflating, hope you sold your calls. Have a nice one today

  36. button

    Boy, PLX is yet another great example of selling into the initial excitement.  Sold 1000 shares at the open for $7.65 & bought it back at $7.01. $640 swing in less than 45 minutes.

  37. button

    TASR breaking out strong today off what appears to be a double bottom "W Pattern over the past few months.

  38. lolobear

    GMCR – ok anybody else playing this?  I made good money on buying calls last quarter at around the $51 mark.  There seems to be a lot of negative sentiment around this but i'm wanting to buy calls again since its coming off the bottom.  Anybody else tinkering with this momo..??

  39. lolobear

    GMCR – i posted this yesterday on what could also be a technical bounce.  But again, not sure. 

  40. Phil

    TNA/StJ – There was a stop at $3 on the last 5 of our long calls.  I'll look at the rest in a while. 

    CHK really hammered, back to $17, we'll want to add more spreads in the $25KP. 

    LULU making new highs – talk about bullet-proof!   NKE too.  

    Aside from LULU, other safety stocks are holding up the S&P and the Dow for the moment.  

    Nice numbers rundown StJ – thanks!  That ADP number has got to be a concern because the private sector has done ALL the hiring and the Government has been laying off.  I believe this month they are actually halting Saturday delivery in many places – not sure how many unemployed that will add but can't be good – nothing scarier than unemployed postal workers in carry states!  

    On those PMI's – just keep in mind that under 50 is contraction.  That's the main issue – expanding or contracting?  

    CMG/Newt – If you did the spread and you're ahead, I'd hang on and see how far the market dips – could be fun.  If you were naked and now down – I'd consider rolling up to the $390 puts ($5.70) for $2.50 but keep in mind your goal is to get back to net even and get 1/2 out.  

    Money, Power, Wall St./Burr – Thanks, it's a great series.  

    Taking PLX profits/Pharm – Yes, ALWAYS selling into the excitement, even when you still have high hopes is a good plan.  Had $8 at the pre-market open.  

    CF/Yodi – Big surpluses in Ags and hogs at the moment, not sure if that's good for the fertilizer biz.  I assume you cashed the stock and are left with the short May $175 caller naked (now $23) so why not roll to the Jan $190 caller at $29 and sell the $170 caller for $14.50 as you are taking a $23 obligation with no premium and sending it to a call/put combo that's just $7 in the money with $36.50 of premium?  If you like the stock enough to waste $17.76 on a call (I assume the $180s), then why not NOT spend that and collect another $36.50 in premium and your worst case is owning the stock at net $150.60 (I think)?  If you don't like them enough to do that, then you have your answer about taking the $3,600 and running now.  If you want to buffer a move up (I wouldn't under $200), the 2014 $190/240 bull call spread is $20 and gives you 15% upside protection while you wait.  

    CHK super flush in progress.  Does Eddie Lambert own them too?  

    Plosser/Pharm – LOL!  It's not just the great minds at but the speed at which they finally come to realizations that astounds me.  

    Oil inventories disappoint yet again.  Net down about 1.1M nowhere near enough to sustain $105.  /CL short is good off the $105.50 line!  

    EIA Petroleum Inventories: Crude +2.8M barrels vs. consensus of +1.8M. Gasoline -2.0M vs. consensus of -0.4M. Distillates -1.9M vs. consensus of +0.1M.

  41. sagemm1

    Phil/Oil
    So adding the numbers up the draw was 4.3?

  42. crussell14

    Phil
    do you see a play on HLF after Einhorn's comments knocked it down on strong earnings?

  43. stjeanluc

    TNA / Phil – Thanks, they did get to $3 around 15:00 yesterday! They are out now.

  44. scottmi

    DGAS – someone said was looking for another nat gas play. these guys just did a 2-1 split, but no options…

  45. scottmi

    PLX/Button – Nice! you're my hero of the moment! i wanna do that!

  46. stjeanluc

    Tonight's earning fun could come from:

    GMCR – Average post earning move 17.78%
    JDSU - Average post earning move 11.20%
    WTW - Average post earning move 12.20
    PPO - Average post earning move 12.41

    In addition there are earnings from V tonight. MA beat this morning but the stock is still down over 2.5%!

    I'll look at possible strangle later today.

  47. rdn4evr

    Anyone know what's up with the homebuilders? They're spiking up

  48. morxlntway

    I was trying to access the wiki to find the opinions on NIHD but when i click on it i get the book project. Is something wrong with the site or me? (don't answer that)

  49. scottmi

    SVU – 2014 $5 buy/write is even better deal today..

  50. stjeanluc

    PMI / Phil – They are contracting everywhere in Europe. 

    http://ftalphaville.ft.com/blog/2012/05/02/983801/core-infection-and-eurozone-pmis/

  51. Phil

    13,200 hanging tough so far.  Dollar 79.28.  

    ROFL/Hoss – Nice summary on CHK!  

    What is up with the AMZN squeeze at $230?  Is it expiration week already?  Actually, I guess every week is expiration week for them (weekly options).  

    CHK/Sage – Not great for May play but long-term, they own A LOT of gas and some oil too.  Nat gas is at all-time lows, CHK is at all-time lows but they are STILL MAKING MONEY.  This is the same as when we go all in on VLO when they are at $17 and people think that gasoline sales will never be profitable again. 

    JRW/Exec – No idea, he has disappeared and has not answered any Emails that I've heard about.  Hope he's OK.  

    F/Exec – What do I think of not taking 65% off the table?  I guess if you didn't take 100% or whatever off the table last week then there's no point in arguing with you, is there?  The Jan $12.50s are .50 but we expect a weak market so getting more aggressively bullish TODAY is a strange choice to me.  Assuming F holds $11, why not sell the 2014 $12 puts for $2.50 as that's about $1.40 more than you'd collect on the short Jan $11 puts and you have a lower break-even and do MUCH better if F does take off – so much better that you may even be inspired to take your damned call profits off the table next time they are up over .80 like they were last week!  

    Good note on breadth Pharm but remember, man cannot live by breadth alone…. 8) 

    CHK/3putt – I think we'll be moving to June. 

    RIMM/Rperi – It's looking more and more like a stock that's just waiting to die these days.  I'm not clear on your comment though as the spread I suggested only needs RIMM to hold $13, which is not out of the question.  I guess you are just talking about your short puts and the only better alternative I see now is patience.  There are now NO expectations for their new phone so any kind of decent sales will run a lot of people back to the stock but I'd draw a line at $12.50 and stick to it as that would be more than 5% further down from here. 

    CHK/CSL – I love it!  That is exactly how you take advantage of these situations when you are a fundamental investor.  See folks – CSL doesn't care that people are freaking out and panicking out of CHK – he has a value in his head and he plays it and takes advantage of suckers who are willing to pay $26 now to bet that 100 shares of CHK will be going for less than $474 in Jan (70% off).  His margin for taking the trade is $82 so the ROI is 32% in just 7 months – BRILLIANT!  

    PLX/Button – Good job.  That's why we have that one rule. 

    TASR/Button – Be careful of chasing stocks that go up after we have a bullish discussion in chat (this morning in prev post).  The markets are so thinly traded right now that our own trading makes a big difference in small-caps.  

    GMCR/Lolo – I can see a case for them being oversold but I'd avoid earnings like the plague.  If they can't get over $50, they are useless but, if they do and it acts as support, it's a good spot to play long with the obvious stop. I'm hoping they do go up so I can short them again at $65+.  Overall, they fell from $110 to $45 (non-spike) and that's $65 so $13 (20% retrace) is a weak bounce at $53 – beyond pathetic if they can't take that back.  

    Draw/Sage – Er, no, it was 2.8 – 2 – 1.9 = -1.1 unless I missed something in math class.  

    HLF/Crussell – I don't like those MLM companies and Einhorn is right but that IS their business (signing up suckers to be reps who fill their garages with the product they expect to sell) so I don't see the point in questioning a pyramid scheme that has been working since the built the original pyramids.  They popped off the lows already so nowhere near as much fun bu the puts are still pumped up because the internal volatility of HLF hasn't calmed down yet so I think selling the June $55 puts at $4 is reasonable with a stop at $5 and/or the 2014 $57.50/75 bull call spread at $6 – also with a stop at $5 is a low-risk way to test the waters.  

    TNA/StJ – Thanks, that's next on my list. 

    Holy cow, 11 already?  Today is flying.  

    MA/StJ – Was way too high already.  V is the same. 

    Builders/Rdn – Don't see news but so many earnings, someone may have said something bullish.  

    Wiki/Morx – If it is a problem, please let Greg know.  (admin at phistockworld.   com) 

    SVU/Scott – Love those guys.  

    PMIs/StJ – that is VERY UGLY!  But, the news is so bad – IT'S GOOD!  

    Germany denies a secret deal has been cooked up between Merkel and France's putative next president for a €200B stimulus program. Separately, a spokesman declines to comment on remarks by Eurogroup chief Juncker that he's stepping down because he's fed up with Franco-German interference in management of the debt crisis.

    See, you just need to know how to read it! 

  52. Pharmboy

    Speaking of Home Builders, in 2008, TOL's finished goods was 357M, now it is 2.3B!  Now, Revenues are 1/4 of the peak, cash flow is 1/6th…..they better sell some goods, b'c their valuation is right back to where it was in 2008. 

  53. Burrben

    Scottmi / SVU
    I did a 20% allocation yesterday, buying the stock for 5.96 and selling the 2014 5 Straddle for $2.98.  Looks like todays prices are SVU at 5.63 and the 2014 5 Straddle is priced at $2.98 mid still.  I was thinking about adding maybe 10% more today.  What do you think?

  54. stjeanluc

    Jeff Stahler

  55. wappler

    All/TOS commission rates & PSW contact:
    Hi all,
    Quick question for the board:  What's the contact info for the PSW rep at TOS/AmeriTrade and what's the PSW commission rate for stocks as well as futures?  As I recall, it's 1.20 per contract for options, but I don't know about the others…
     
    TIA,
    Wappler

  56. dpastramas

    CHK / Phil – Building on CSL's position which BCs would go for in Jan 13?  I was thinking of buying the 15/20 BCS and sell the 15$ puts for 0.37$ on the 5$ spread. What would you propose?

  57. newt

    CHK- I thought we had a Jan 12.5/17.5 BCS with a 14 put.  I didn't get filled on it.  Still doing this one?
     
    Also- what are we doing in the 25k in regard to CHK?
    Thanks.

  58. 1020

    You gotta love T. Boone calling out the Koch brothers (and some Boone being Boone)….. :)
     
    http://finance.yahoo.com/blogs/daily-ticker/t-boone-pickens-biggest-deterrent-u-energy-plan-125553999.html

  59. rperi

    Thanks Phil, you answered my question, thank you.  Sorry for the confusion, I was asking about options for the short puts.  The spread is obviously still okay at the moment.  Have a safe trip ~

  60. flipspiceland

    @Felipe
    shhhhhush…!
     
    "…Be careful of chasing stocks that go up after we have a bullish discussion in chat (this morning in prev post)."

  61. ccsincsd

    wrapplerTOS
    Options should be $9.99 + $0.75/c.  I got mine dropped to $0.00 + $0.75/c because of pretty high volume (about 3,000 c/month)  I asked to get dropped to $0.50/c but they said not unless  add more money to the account.  I think its all about having the money there to get the best rates.

  62. kinkistyle

    China now planning to build ghost cities in Ireland:
     
    Chinese palaces, in central Ireland

     
    "Although the first €175m phase of the plan is modest, the ultimate vision includes two five-star hotels, a Chinese palace, 445,000sq m of exhibition halls, a commercial zone of 264,000sq m and some 186,000sq m of serviced apartments.

    According to the Irish Times, it would also have a youth hostel, cinema, arts centre, recreation and massage centres, golf course, multipurpose entertainment hall, conference facility, medical centre, fire station, primary school, kindergarten, railway station, two bus stations and a “China Tower” 90m taller than the Dublin Spire."

     
    Developers in Liverpool are also attracting Chinese investment money for their planned "Liverpool Waters" development by making plans to replicate the Shanghai waterfront and build the "Shanghai Tower" skyscraper.
     
    Phil's always pointing how right before Japan's Bubble imploded, they were going on massive spending sprees overseas.

  63. Burrben

    Commish
    I know there are tons of TOS lovers here, but IB has great commish and execution.  0.70/option, no ticket, $1 min.  For cheap premium the commish goes down to 0.25/option, which allows you to close out nickle options cheap if you don't want Ex risk.  Just fyi, no debate on the platform please….
    http://www.interactivebrokers.com/en/p.php?f=commission&p=o

  64. Phil

    Europe closing mixed but Italy down 2.6% and Spain about the same is key.  

    Pisani doing earnings and claiming 6.9% earnings growth on S&P when it's 75% AAPL.  Also, saying how good 70% beat rate is when it was 84% last week.  Amazing how they have a stock propaganda network that just flat-out lies to you all day long.  No wonder they have lost 66% of their audience since 2008.

    Oil $105!  A little late but Egg McMuffins for everyone! 

    FAS Money – Looks good to me with a big 10% gain on the day.  That means we are uber-bearish though and can easily get burned the other way so let's take the quick money and run on the 2 May $108 calls ($2.50 to buy back) and then we're ready to reload and roll if they head back up and, if they head down, we'll be thrilled with the gains on the short $100s. 

    IWM Money – RUT bounced off 810 pretty good but not impressive under 820 at all so I have to stick with my guns here.  

    $5KP – Ouch!  Nothing I want to change though.  We couldn't pull the same trick with TNA we did with the $25KP position due to margin issue here so we have the worst of both Worlds at the moment.  

    $25KP – I thought we'd be up more but it's fine.  We'll have to see how the next few days resolve themselves.  

    AAPL pumping Nas and S&P but that's all I see going strong outside the flight to safety stocks as Cramer has been screaming for people to run to dividends all week.  

    Dollar 79.28 sill holding up.   Copper barely holding $3.75 on last drop, now $3.78.  If oil fails $105 and copper fails $3.75 – that's going to be a good leading sign that we sell off more (along with Dollar popping 79.40).  

  65. stjeanluc

    It's just getting unreal now….

    http://www.bespokeinvest.com/thinkbig/2012/5/2/crude-inventories-rise-to-record-highs.html

    It looks like I post the same chart every week, we pile up oil but price keeps on going up!

  66. Phil

    CHK/Dpast – I almost forgot.  I like selling the Jan $17.50 puts for $3.20 and buying the Jan $12.50/17.50 bull call spread for $3 for a net .20 credit on the $5 spread that's $4.50 in the money at the moment.  Nice way to make 2,600% on cash at $17.50.  If owning CHK at $17.50 scares you, you can sell the 2014 $13 puts for $2.70 but that's the escape roll from Jan anyway.  

    Good trade to start our new Income Portfolio with but not ready yet.  

    CHK/$25KP – Let's roll the 3 May $15 calls ($2.35) to to the June $15 calls ($2.75) for .40 and DD at $2.75.  We're not adding more covers nor moving the puts yet.  

    LOL on inventories StJ – Prices should be there, they are running up with the inventories, baffling econ 101 students everywhere.  

    OK – Gotta fly.  Don't let them stick the markets please! 

  67. lancep50

    TASR
     
    American Heart Association: Tasers can cause death
    http://www.usatoday.com/news/nation/story/2012-05-02/taser-study-deaths/54688110/1

  68. scottmi

    SVU/Burrben – i think it is a good buy at this price which is right above a gap up last month. I'm adding one more nibble. Also last month bounced off 5.07 so might go there again.. if so, i'd take another.  With this one, your $5 puts might someday get put to you, so I won't be going more than 50% in until the first puts sold expire, and then, i'll probably just grow another 10% and write OTM puts again.     

  69. zeroxzero

    Marginal oil production costs are heading towards $100/barrel
    Posted by Kate Mackenzie on May 02 12:01.

    Bernstein’s energy analysts have looked at the upstream costs for the 50 biggest listed oil producers and found that — surprise, surprise — “the era of cheap oil is over”:

    Tracking data from the 50 largest listed oil and gas producing companies globally (ex FSU) indicates that cash, production and unit costs in 2011 grew at a rate significantly faster than the 10 year average. Last year production costs increased 26% y-o-y, while the unit cost of production increased by 21% y-o-y to US$35.88/bbl. This is significantly higher than the longer term cost growth rates,highlighting continued cost pressures faced by the E&P industry as the incremental barrel continues to become more expensive to produce. The marginal cost of the 50 largest oil and gas producers globally increased to US$92/bbl in 2011, an increase of 11% y-o-y and in-line with historical average CAGR growth. Assuming another double digit increase this year, marginal costs for the 50 largest oil and gas producers could reach close to US$100/bbl.
    While we see near term downside to oil prices on weaker demand growth, the longer term outlook for higher oil prices continues to be supported by the rising costs of production.

    This is important because, as Bernstein analyst Neil Beveridge and colleagues note, the cost of producing marginal barrels of oil plays a big role in determining oil prices.

  70. stjeanluc

    Good article on CHK in Reuters…  McClendon is really a tool!

    http://www.reuters.com/article/2012/05/02/us-chesapeake-mcclendon-hedge-idUSBRE8410GG20120502

    And Felix take on the article, McClendon and extrapolation on the top 1% and their behavior:

    http://blogs.reuters.com/felix-salmon/2012/05/02/how-the-1-think-about-their-wealth/

     

    Does it ever occur to Conard, I wonder, that there are lots of people in America who work very hard until 11 o’clock or much later — just to be able to feed and house their family? Did he even think, as he was saying this, that he retired at the age of 51, an ultra-wealthy man, and can now spend as much time as he likes watching his children and being with his wife and living a life of serenity and beauty?

    I suspect that McClendon doesn’t spend much time on introspection. But insofar as he did, he probably aligned himself pretty closely with Conard’s ideas. He was working hard, he was being successful — these are good things, not something to nitpick or criticize. Somewhere, he probably knew that the hedge fund wouldn’t look good if people found out about it, so he kept it secret. But more broadly, I think the rich really are different from you and me — or, at least, the self-made rich are.

    We think of money as a means to an end: we don’t think of making money as being, in and of itself, a good thing. If Reuters were to double my salary tomorrow, that might make me happier, but it wouldn’t confer any obvious benefits on society as a whole. But once you reach the Conard/McClendon stratosphere, your thinking changes. And as Davidson says, there’s every indication that Mitt Romney’s thinking is much closer to Conard’s than it is to those of us in the 99%.

    I really don't care personally about McClendon, but shareholders are sharing the risk and are not being rewarded while he collects millions! When are we going to have a system where CEO compensation is tied to the shareholder's fortunes. That's capitalism….

  71. Phil

    AM At the open: Dow -0.41% to 13226. S&P -0.62% to 1397. Nasdaq -0.53% to 3034.
    Treasurys: 30-year +0.44%. 10-yr +0.19%. 5-yr +0.06%.
    Commodities: Crude -0.48% to $105.66. Gold -0.48% to $1654.45.
    Currencies: Euro -0.76% vs. dollar. Yen +0.06%. Pound +0.33%.

    10:00 AM On the hour: Dow -0.41%. 10-yr +0.14%. Euro -0.66% vs. dollar. Crude -0.39% to $105.75. Gold -0.74% to $1650.05.

    11:00 AM On the hour: Dow -0.35%. 10-yr +0.14%. Euro -0.64% vs. dollar. Crude -0.69% to $105.42. Gold -0.59% to $1652.65.

    Europe closes mostly lower, but off the worst levels of the session, never recovering from a spate of weak economic data. Stoxx 50 -0.7%, Germany -0.8%, France +0.4%, Italy -2.5%, Spain -2.6%(taking out its March 2009 low), U.K. -0.9%, The euro -0.6% to $1.3156.

    Banking shares are leading steep declines in the headline indices for Spain (3.2%) and Italy (2.7%). Santander (STD -6.7%) and BBVA (BBVA -6.7%) are both indicated at new 52-week lows in premarket activity. In Milan, Unicredit is suspended-5.8%. Other EU banks: DB -4.3%BCS -3.4%CS -4.7%

    12:00 PM On the hour: Dow -0.37%. 10-yr +0.11%. Euro -0.63% vs. dollar. Crude -1.06% to $105.03. Gold -0.71% to $1650.55.

    Apr. ADP Jobs Report: +119K vs. +201K prior (revised from 209K) and expectations of 183K.

    More on ADP report: Private service-providing sector gains 123K jobs. Manufacturing employment loses 5K jobs, the first decline since September and not jibing with positive PMI surveys. Construction employment off 5K jobs, the first decline in 7 months; perhaps payback for gains seen during the mild winter.

    The weak ADP jobs reading doesn't chime with yesterday's improved employment index in the ISM manufacturing report and other indicators of a strengthening market, MarketBeat points out. Analysts aren't buying the ADP print either, especially given its record of missing the government's numbers by rather large amounts.

    Mar. Factory Orders: -1.5% (460.5B) vs. consensus of -1.6%, +1.3% prior. Shipments +0.7%. Inventories +0.3%.

    The Treasury will take more time to analyze the feedback it's received about issuing floating-rate debt, which has been positive overall. The Treasury was expected to decide this week. The argument in favor is that the current auction system doesn't allow it to sell debt with a negative yield in the primary market, although not allare convinced.

    Hurts so good!  The bad news on EU PMI numbers, in which weakness has spread deeply into the core is the ECB's forecast of "a slight contraction of GDP" is looking optimistic, says Chris Williamson. The good news is the reduction in price pressure, opening the door for further stimulus. Maybe that's what's finally caused a steep decline in the euro.

    "I think we're a year away from the French fully nationalizing their banking system," Hugh Hendry tells the gathering at the Milken Institute. The trade in Europe, he says, is to be short financials and long exporters as he sees the euro headed towards parity with the dollar, "a profound economic advantage to what are already super-competitive businesses." (full panel video here)

    S&P joins Fitch in lifting Greece out of default territory, increasing its rating on the country to the low-speculative grade of CCC and giving it a stable outlook. Greece's massive debt swap has "alleviated near-term funding pressures," although "Greece's sovereign debt burden remains high" and the rating could be lowered again, S&P said. 

    "Be very worried about elections in Greece," writes UBS, saying there is a high risk of the IMF and then the EU simply cutting off funds as whichever new government takes shape cannot implement required austerity measures. Not so fast, says UBS to those who think events in Greece no longer have the ability to roil markets. (h/t Steve Collins

     Brazil's April PMI declines to 49.3 from 51.1 previously, the first contraction in 2012. The only sub-indices above 50 were (what else) input and output prices, with output prices hitting their highest level since May. Better Brazil than Spain, where input prices are on the rise, but output prices are falling. Brazil ETF: EWZ -0.7%

    It's not a conspiracy – it's just designed that way!  The divergence between China's official (expansion) and HSBC (contraction) PMIs can be explained, says Fitch, by the companies surveyed. The official read tracks large, state-owned enterprises which tend to have easier access to credit, while HSBC's report is drawn from strictly private-sector businesses. 

    Interest rate liberalization in China is moving beyond Beijing's control, argues Deutsche Bank. Even the country's banks are offering "wealth management" funds, allowing savers rates more than double the official deposit rate of 3.5%. "It is too late for policymakers to turn back the clock," says Deutsche, urging swift recapitalization of a banking system that may no longer be able to rely on cheap deposits.

    Byron Wien has been making forecasts for 25 years, and he's predicting a Y/Y drop in oil prices for the first time ever as swelling production pushes global inventories higher. There’s a “lack of appreciation” of how much oil will be extracted from fracking of rock formations in the U.S., Wien says, also expecting the furor over a potential conflict with Iran to dissipate.

    Byron Wien's short-term outlook aside, Bernstein examines upstream costs for 50 top oil producers and determines that "the era of cheap oil is over." Marginal costs for the 50 rose to $92/bbl in 2011, up 11% Y/Y, and could near $100/bbl this year – important, Bernstein says, because the cost of producing marginal barrels of oil plays a big role in determining oil prices.

  72. stjeanluc

    Oil prices / Zero – Big caveat from that research:

    Also, this research obviously only covers non-Opec producers, and it mostly excludes Russia too. Given Saudi Arabia’s role as the “swing producer”, how are the ex-Opec, ex-Former Soviet Union marginal oil production costs so correlated to Brent prices?

    That makes a big difference I think as extraction costs in Saudi Arabia are like $20 / barrel or so…

  73. Phil


    The Chesapeake (
    CHK -13%Q1 call has ended, and aside from McClendon's opening remarks - "a great deal of misinformation" has been published, he's "deeply sorry for all the distractions" – analysts (screened?) focused on CHK's asset monetization and debt reduction plans. CHK continues to emphasize its move from gas to oil, and says it's on track to meet debt reduction targets.

    Keep the damned coal in the ground.” That's the goal of environmentalists attempting to block Arch Coal (ACI) and Alpha Natural Resources (ANR) from building export terminals in the Pacific Northwest. Fears that a deluge of U.S. coal would cause Asia to use more coal are backed by studies finding that a 10% reduction in coal cost would result in a 12% increase in coal consumption.

    Arch Coal (ACI -3.3%) is cut to Market Perform with a target price lowered to $15 from $22 by Howard Weil, which says Q1 results and revamped expectations for 2012-13 has caused the firm to reduce forecasts. Although the stock is already -36% YTD, the firm believes other names in the space present better relative performance opportunities over coming quarters.

    Yamana Gold's (AUY -2.5%Q1 profit rose 15% as improved average realized prices for gold and higher production boosted revenue. But input costs increased, and revenue was well below market expectations. Production in 2012 is projected at 1.2M-1.3M GEO, and is targeted to a sustainable level of ~1.75M GEO by 2014. - They are just going to make more and more of this stuff until it crashes and burns.  

    Shares of Arena Pharmaceuticals (ARNAjump 14% after it said late yesterday that an FDA advisory panel will meet on Thursday next week to discuss the company's anti-obesity drug Lorcaserin. The company also said its Q1 loss per share narrowed to $0.18 from $0.35 vs. consensus of $0.13; revenue fell to $2.19M from $3.93M. (PR)

    PTs for OpenTable (OPEN -16.1%) are falling post-earnings, thanks to the company's disappointing revenue guidance, soft international sales, and weak restaurant adds. BofA (Neutral) is worried OpenTable's tech spending might be too low, but thinks an upcoming re-launch of the company's U.K. service could give it a lift.Benchmark (Buy) notes management has typically been conservative with its outlook.

    Target (TGT) is halting sales of Amazon's (AMZN) Kindle line as of May 13 due to a "conflict of interest," per an internal memo. The Verge speculates a recent deal to open Apple (AAPL) mini-stores within its outlets could be the reason. This won't be the first time this year a bricks-and-mortar retailer has chosen to boycott Amazon products. 

    Canaccord's Mike Walkley says his monthly checks indicate global smartphone demand, which IDC believes rose 42.5% Y/Y in Q1, isn't letting up, and that sales of Qualcomm's (QCOM) high-end Snapdragon S4 processors are benefiting. Walkley maintains an $80 PT on Qualcomm on expectations of strong smartphone/tablet demand, growing Snapdragon share, and strong 3G smartphone sales in emerging markets. (previous

    Nokia (NOK) will start selling its PureView phone this month, although analysts have warned that it will be hard to sell as it runs on Symbian rather than Windows. Still, the whopping 41 megapixels on the camera, which provide it with a 3X "lossless" zoom, could prove attractive. Nokia has also extended its exclusive agreement with Carl Zeiss.

    Nokia (NOK -3%) announces it's suing HTC, Research In Motion (RIMM -3%), and Viewsonic for patent infringement in (where else?) the U.S. and Germany. Though it's possible these battles will drag on indefinitely in a manner similar to Apple's (AAPLdisputeswith Android OEMs, it's worth noting Nokia settled its suits against Apple last year in exchange for a $600M licensing fee and ongoing royalties.

    Now I REALLY have to go – later all!  

  74. rustle123

    World markets except for France all down, a couple over 2.5% and here comes the stick.  This is truly the "teflon market".  ADP numbers disappoint, screw it, Spain and Italy in trouble, not our problem, UK going back into a recession also, so what, BUY BUY BUY

  75. jabobeast

    FU PCLN!!!
     
    FU CMG!!!

  76. lionel

    Rustle/ Good observation and all these markets are back to 2009 lows (except for Germany)
    And US markets are….way too high.
    So discount USD devaluation (Thanks to the Fed) and we still have 15-25% to go down.
    Now all these maneuvering from the Fed and from the financial media make more sense as they are trying to defend a way overblown level.
    Let see how long they can afford to play this game.
    Patience is on our side

  77. Canuck

    Newbie/Type 1 – yes, he is only six years old.  Did his first unassisted blood sugar level check yesterday – amazing how they adapt,  as I believe either Sage or Rain suggested.
     
    Phil/ Islet cells – he would be at least 10 years away from being eligible to even attempt – hopefully we will be past leeches by then.  I think it was more important to his mother that there is HOPE out there. 
    That being said, we will be doing a walk for Juvenile Diabetes fundraiser in June here in Vancouver.

  78. jthoma

    rustle- It's a Cramer market and nothing but can kicking- hard to beleive how long these things can last. I guess we are going to have to choke on our own Gonads before anyone is anything other than oblivious!

  79. kustomz

    rustle, markets now solely worshiping at the feet of Bernanke and his black magic, QE3. I'm still betting on the great unwind, they can hold it off for only so long. We are in the 7th months of the global CB party to support markets…tick tock.

  80. rustle123

    There will absolutely be no QE anything IMO as long as oil is at this level and inflation remains high.  The destruction of the economy would be immediate and lasting if they launched a QE3 right now.  High oil prices have finally seaped through into our economic numbers and if we spiked to 115 or 120 a barrel for 2-3 months, game over economy.

  81. Canuck

    Phil/anyone – Islet cell pouch delivery trial
     
    SNV.v  – TSX venture exchange — Sernova Corp
     
    LONDON, ONTARIO--(Marketwire -05/02/12)- Sernova Corp. ("Sernova" or the "Company") (SVA.VNews) today announced it received Health Canada Approval to conduct a human clinical trial assessing both the safety and efficacy of Sernova's Cell Pouch™ with transplanted insulin-producing islets in patients with insulin-dependent diabetes. The study will be conducted in collaboration with Dr. James Shapiro at the University of Alberta Health Science Centre in Edmonton.
    "Sernova's compelling pre-clinical results provide optimism that the Cell Pouch™ has the potential to change the standard of care of patients with diabetes receiving islet transplantation," said Dr. James Shapiro, principal investigator of the study. "I am excited to begin enrolment of patients in this ground breaking clinical study to evaluate the Cell Pouch™ in humans."
    The study, entitled "A Phase I/II Study of the Safety and Efficacy of Sernova's Cell Pouch™ for Therapeutic Islet Transplantation," is an open label, non-randomized, single-arm, Phase I/II safety and efficacy study of up to 20 patients with insulin-dependent diabetes undergoing allograft pancreatic islet transplantation.
    In this study, patients who have met the enrolment criteria and provided informed consent will be implanted with the Cell Pouch™ approximately 2-12 weeks prior to transplantation of donor human islets. To prevent islet graft rejection, patients will be treated with the standard immunosuppressive regimen.

  82. lionel

    Jabo/
    How did you manage to get a picture of my girlfriend!
    Thank you, it made my day a bit lighter.

  83. Kwan

    Morx – Phil wanted the book project to show when the link is clicked for the wiki. You can still get to the opinions page by clicking on "Main Page" on the left side of the screen after you click the link for the wiki.

  84. pat_swap

    Pharm,
    Yesterday it was suggested that rolling out in time by incurring a small cost is better than moving up in delta for the same expiration day.
    this is for the USO May 39P. how about rolling out to June 39P but reduce the number of contracts to keep the cost same. I guess the disadvantage here will be the slow rise in the value and a longer time frame to come  out of the position at even. Is my understanding correct?
    Thanks.

  85. kustomz

    Ben Bernanke-Knock knock Rustle,
    Rustle- who is it?
    Ben-Its Ben Rustle…
    Rustle- Ben who…
    Ben over cause your about to get #*$&*@

     

  86. shadowfax

    Production costs
    One must remember that a figures are produced by per centages of estimates. If you change an estimate to say 50% of where it was then the cost doubles but that is not all everything is on a depreciation schedule. If you change the reserve it also effects the depletion rate that effects most of the other estimates. This turns into a numbers game constructed to justify a number. I have 2 problems with all this, first with a 3% sample you can create anything you want for an out come and you can start with the desired answer and solve for the variable or variables. An expert says we made a mistake with this estimate and we have another Alaska oil field that should be dry still producing 50% of peak and old wells in Oklahoma reopened. Second it is an excuse to ignor supply and demand. Lower demand drives down price, the high cost product goes off the market unless it is manipulated and it seems everything is. Higher priced oil costs more to refine because it is the largest part of prodution cost. Give this to the legal staff and you get what you want.

  87. scottmi

    Oil – don't know about you guys, but i haven't been buying up/using more oil/gas in the last couple weeks. It is not done going down and with the dollar sagging too. Just TOO much oil on hand that has to DROP before i will fill up my cars, boat, jerry cans again…buying right now is strictly on an 'as using' basis. This price is too high.   

  88. shadowfax

    scottmi
    Glad to hear someone else is onto the issue. If every car went to low the demand would fall off a cliff for long enough to get the message out. I have a 1,000 gallon oil tank to heat my house. I said I would not pat $3.50 per gallon so it went empty March 2011 and is still empty. I put in a heat pump and heating cost went fron $700 to $250 per month to heat my house this winter and that includes $35 per month for the meter. I put $50 Diesel in my truck since November to plow snow. Start a movement. It worked in the 1970s! The truely broke are already in with this empty tank thing.

  89. kinkistyle

    Great video of "super-bear" Hugh Hendry at the Milken Institute Conference giving one of the most bad-ass bullish calls on the future of the United States I've heard.  Starting at 52:50:
    http://youtu.be/ObMfmE3JMAc?t=52m50s

  90. Phil

    Henry is not a super bear. He just calls the macros and the macros have sucked for so long he seems like one. I’d say over 200M globally unemployed would say he’s been right on the mark.

    Just catching up from the limo. No place better to find out what’s going on than right here!

  91. shadowfax

     First we open down, then bounce off lower assending trenline support, next we have the gap fill back to the open, the next move should be down, maybe by close, maybe tomorrow. A little late stick head fake maybe. It really is time to reprogram the computers, should we go with A B C D E F G ……..? How about something new? Too much work and nobody pays attention anyway.

  92. kustomz

    Canadian housing market..2 important charts
    http://www2.macleans.ca/2012/05/01/how-the-housing-market-is-pumping-up-our-gdp-numbers/
     

  93. dclark41

    Phil:
    Are you already in Vegas?

  94. shadowfax

    Support is now @ 80.80 risistance @ 82.95

  95. exec

    Phil/Ford

     
    I read your Ford call response 3 times last week and I never got it.  Now I know why.  I sold the Ford calls not bought them as I'm thinking you assumed.

  96. stjeanluc

    It is just not going to end well in Europe:

    http://delong.typepad.com/sdj/2012/05/hope-is-not-a-plan.html

     

    I feel as though I am sitting through a Charlie Kindleberger lecture about Europe in the early 1930s. Every country thinking that the global and continental level of aggregate demand was somebody else's business. Every country thinking that if only it could impress international investors with its creditworthiness that investment would flow to it and away from other countries. Nobody willing to act like a hegemon. And nobody upset at the absence of a hegemon willing to act responsibly.

    Three more months of this and I will be calling on European sovereigns to incorporate themselves in Delaware as bank holding companies and join the Federal Reserve System…

    And:

    http://www.economist.com/blogs/freeexchange/2012/05/euro-zone-crisis-0?fsrc=gn_ep

     

    Ordinarily, of course, policymakers would react to this deterioration by taking steps to stabilise the economy. What is most frightening about the euro-area picture is that this is not happening. For now, austerity remains the rule. Despite the nastiness of the economic picture, the ECB is widely expected to take no action at its meeting tomorrow. The euro area is walking, eyes wide open, into depression. Led by its periphery, which is already there.

    Most everyone seems to have convinced themselves that this sort of thing isn't so bad, so long as a Lehman-like financial collapse is avoided. It isn't. Nothing good will come of a euro-zone depression.

    If, when all of this is said and done, the euro zone descends into a chaotic, costly break-up, many people will write that such a thing was inevitable, unavoidable. They'll be wrong. We are watching causation this very moment: institutions that know how and why to prevent things from falling apart and which nonetheless sit back and do nothing.

  97. morxlntway

    Thanks Kwan

  98. kinkistyle

    Hendry/Phil: Yep, thats why I put it in quotations.  From the way he is talking about the future of the United States, LT he doesn't sound so bearish to me. :)   I really like the way he tells it like it is whether he is bearish or bullish on it.

  99. shadowfax

    exec
    I have that can't forget problem. JRW last posted from France. Maybe he is injoying his villa in Morocco maybe spelled wrong, that, typing, and remembering names are my weak points.

  100. Pharmboy

    pat…. by using the funds and buying a reduced number of contracts will essentially not take away funds from your pocket, but the downside is it takes a much larger drop in the price of USO to make up for the lost funds just to get even!  The goal here is to get even and then decide to get out, or stay with the trade.  So originally, if you bought the 10 contracts for $1, that is $1K.  Now those 10 contracts are ~$390.  That means rolling to ~ 4 USO 39 June contracts with a delta of .38 for 90c.  USO would have to drop to about 36.50 by June expiration for you to get back to even!!!!!  That is not out of the question, but getting your money back would be very difficult.  By DD on the June contracts from 10 to 20, USO only has to drop back to ~ 39 to get even……then you can sell the DD group and let the other 10 go…..

    In 2007/8, USO was a killer to many of us here, as it just kept going up – but eventually all the rolling, DD, etc. paid off.  It was brutal though to keep this up….

  101. jabobeast

    this market is unbelievable… can't go down..
     
    FU market!!!

  102. dclark41

    Watch out for oil. Something is causing the Israelis to call up troops. Reaction to events in Egypt and Syria, but the drama starved oil markets love this kind of sh!t to push prices up further.
    http://www.timesofisrael.com/knesset-approves-call-up-of-22-idf-battalions/

  103. Phil

    Vegas/DC – not even SST could have done that! They sent a big limo so I’m hanging in the back on the way to the airport.

    F/Exec – well I just have the iPad so remind me in the morning and ill take another look.

    Roughly 150 drop on Dow means bounces of 30 (13,170) and 60 (13,200) are key in the futures.

    S&P was 1,410 to 1,390 so it’s 1,394 and 1,398, now 1,397 so strong bounce on /ES but maybe AAPLand flight to safety helping.

    NYSE looking more like weak bounce at the moment. Watch out for which way things break. I see dollar down a bit now that Europe is closed

    I’m here. Will chat from lounge.

  104. dclark41

    Phil:
    :) Have fun! Been in and out all day.

  105. randers1

    Lancep50- I will agree TASRering is probably not good for people,getting shot with guns is not either. If given the choice, I think most suspects would opt for the taser.

  106. stardawg

    kustomz
    CDN housing…great charts. I live in British Columbia
    I just met with my commercial BMO manager.  He is saying BMO is leading 'conservatism' in real estate lending and he is losing his 5 million plus deals to TD as BMO is shying away from large transactions. Ergo he is very frustrated and he basically vented our whole meeting as he lost 3 of his biggest accounts in the last 60 days….
    He also noted the recreational areas (ski, wine country) are coming anywhere between 20-40% under 2010 assessments on some of the larger priced properties--don't read headlines on that anywhere either….All experienced real estate speculators know that the outlying areas and rec areas outside major centres move down first in a correction…then bam….major centres start reporting declines…..6 months to late for average joe to catch on……
    my insurance broker that lives in a suburb just outside of Vancouver, BC bought a nice place in 09 and just sold it for 10% less than he paid….there is a correction in vancouver, its just not being reported.
    Another example, i could of got 410K for my rental property in 07…now i'd be lucky to get 320K.  Do the math….
    I find these reports hilarious as activity may have picked up but prices sure have not. In my market, i get the mainline realestate board reports and they are pretty much a joke as well.  It's a great example of how activiy (number of places sold can be accurate, but smoothing from using house price averaging and delays in reporting make things look 'good'…..
    IMO although the CDN fed may keep rates low for a while yet…but…, our recent 2.99 year fixed rate mortgage was a shot over the bow for people to lock in.  In fact, our BMO personal banker was forced to call over 1000 clients last 60 days before the deal closed…in 20 years she never got 'pushed' that hard to lock or change over peoples mortgages………
    strange times indeed!

  107. Canuck

    Cdn Real Estate/Kustomz&stardog,
     
    Recreational real estate has been down for 3+ years now, places like whistler, fernie and kimberley I have first hand knowledge of it being down, and also ski areas in the okanagan valley.
    Residential real estate in my area(westside of Vancouver)  is at all time highs as well as a few pockets around vancouver proper.  Calgary is off its highs though and a few places in ontario are near their highs as well.

  108. stjeanluc

    Homebuilders are cooking…

    http://www.businessinsider.com/housing-is-having-a-monster-day-2012-5

    XHB 0512 624x303 Wednesday links:  buyer beware

  109. Pharmboy

    Oh, for you jabo….(and for those Cad's out there)

    'Cause you're working
    Building a mystery
    Holding on and holding it in
    Yeah you're working
    Building a mystery
    And choosing so carefully

                      – Sarah McLachlan

  110. stjeanluc

    Something maybe for the wiki – what's the difference with trading options on commodities:

    http://www.investingwithoptions.com/2012/05/02/commodity-options-trading-differences/

     

    Equity investors are fearful of downside in equities. But in commodities like gold, oil, soybeans, and currencies the perception of risk is bi-directional.

    That means the tail risk can be on either side.

    Think about oil– if we saw a $20 move in oil to the upside in a very short amount of time, that would have significant consequences across various assets.

    So when hedgers and speculators come out to commodity options, they fear strong moves in either direction.

    This changes the strategy set used in commodity options trading– iron condors become more attractive, as do ratio sales after extreme moves.

  111. jromeha

    Pharm – wasnt able to get my orders filled with regards to getting out of PLX. Still have the 5/7.5 bull call and $5 August calls. Would you close out 1/2 here or wait? Thx.

  112. stjeanluc

    The demographic challenge in China:

    http://www.bloomberg.com/news/2012-04-30/china-s-population-crash-could-upend-u-s-policy.html

    The Census Bureau predicts that China’s population will peak in 2026, just 14 years from now. Its labor force will shrink, and its over-65 population will more than double over the next 20 years, from 115 million to 240 million. It will age very rapidly. Only Japan has aged faster — and Japan had the great advantage of growing rich before it grew old. By 2030, China will have a slightly higher proportion of the population that is elderly than western Europe does today — and western Europe, recall, has a higher median age than Florida.

  113. jromeha

    Phil – Im really getting the itch to short /Ym into the close for the anti-stick. Down 15 pts off the ridiculous jobs numbers, poor european data, etc!?!?! Sorry, even the bots have to be a little scared (I know Im just dreaming with that comment). I

  114. Inkarri1982

    CHK taking a beating…

  115. scottmi

    Oil – will it close below 105 today? looks like is getting volume to support i everytime hits 105. dollar giving a bit of a stick but oil still weak..

  116. sagemm1

    Doesn't it seem just wrong that all the data point to more risk to be long than short but the feel is that the risk is being short this market or it could be that I am soooooo down this year from being short that this bear is quite skittish.

  117. craigzooka

    Thinking of adding some RIG to the IRA Portfolio.  Anyone have any opinions?  They have dropped $9 since march and are starting to look attractive to me.

  118. stjeanluc

    To add to the CHK misery, Nat Gas is down $0.15 today!

  119. Inkarri1982

    For you CHK players – Isn't the book value for CHK far higher than what the stock is trading at now? 

  120. stjeanluc

    RIG / Craig – Looking at a 52 week chart, it looks like there is a line around $48. But they have been down as much as $38 last December. And what happens to them if oil takes a hit? That would be my biggest question. What is the correlation?

  121. dpastramas

    BMRN / Pharm – Stock popping today, any news or just the PLX effect?

  122. Phil

    PLX 12:14 PM Canaccord takes some of the shine off Protalix’s (PLX +13%) early morning 27% run-up in the wake of the FDA’s approval of its new treatment for Gaucher disease, downgrading the shares to Hold after digging deeper into the report. The firm says it sees only modest U.S. but solid Israel/ROW potential, and EU approval may in fact be blocked.

    CME 2:28 PM “People need to study their facts” before criticizing speculators, CME chairman Terry Duffy says in response to Pres. Obama’s blaming traders for driving fuel prices higher. Speculators provide vital liquidity to markets: “When the Dow goes above 13,000, Google goes above $600/share and everybody celebrates, who do you think did that? The U.S. equity market is 100% speculators.”

    DIS 1:50 PM With a U.S. debut only two days away, Disney (DIS -0.5%) film The Avengers looks set to smash the impressive opening weekend $152.5M haul of The Hunger Games. Fandango.com reports that 91% of all advance movie tickets sold yesterday were for the superhero film featuring the buffed trio of Thor, Iron Man, and the Hulk – while on the social front a noteworthy 1.3M “likes” on Facebook have been recorded for the movie.

    That was Jackie’s reason for picking DIS last week!

  123. Phil

    Book on CHK – I don’t even think that’s a fair assessment if based on current gas prices. Their oil costs are high for production and transportation as are labor costs in that industry so it’s all very distorted right now. Logically oil and bat gas should be readily exchangeable, keeping the cost per BTU roughly on line. I believe, at the moment, that that cost is 6x more per BTU for oil so, either oil is way too expensive or gas is way too cheap.

  124. pat_swap

    Thanks Pharmboy!
    It helps to understand how a strategy play out and more important what's the motive behind it.

  125. stardawg

    CANUCK  
     
    you know what is hilarious, 2 friends that own rec properties near Princeton and Big white got land tax assessments 15% higher than last year.  They both called to complain (to your point about things being down) and as you know were basically told to take a hike by hte  BC Assessment authority…another tax grab at its best….Sure wish we still had our house in West Van though!  

  126. rustle123

    Wow, can't believe Junior Seau committed suicide.  He was 43.

  127. David Ristau

    The Oxen Group likes the pairs trade in Equinix (EQIX) long and Ultra Proshares Oil (UCO) short. EQIX apperas to be bottoming after a great earnings report and pullback. Oil is a great short on overvaluation and hedges the long well.

  128. angelcur

    omg  spain has hired goldman as an advisor…that is stepping on the same rake twice!…gotta find those forex hedges to hide their debt!! PRONTO!!

  129. stjeanluc

    Chanos is now short Petrobras and doesn't like the coal sector:

    http://www.marketfolly.com/2012/05/jim-chanos-shorting-petrobras-fortescue.html

    Chanos, of course, is famous for flagging Enron, among other notable frauds.  So what's he short now?  Petrobras (PBR).  He says that integrated oil companies are 'liquidating trusts.'

     


    He also believes that natural gas is undergoing a revolution in the US and so he thinks this is bad news for the coal industry (particularly thermal coal).
  130. Pharmboy

    Caannnnnccoooord…can get a rope and KMA.

  131. Inkarri1982

    Wow…is resilient the right word when describing this market?

  132. Canuck

    Phil,
    Nok ($3.60) buy/write,
    Jan 13 $3.50 p&c for $1.30, 2.30/2.90 and dividend yield of 11% and 50% gain if called,
    or,
    Jan 14 $3.50 p & c for 2.10, 1.40/2.55 and a yield of 18.5% and 150% gain if called --
    the numbers are compelling, but with Apple and Samsung dominating the sector, do I really want to be owning 2x NOK?
    What kind of value do they have at this level?

  133. lflantheman

    PCLN/    Bull Call Spread   760/765.     This trade was placed last week at 2.50.   It is now a bit of a crap shoot.  I suggest you get out at 2.50 or 3.00 if the trade will go through.   Stay in if you are more confident that PCLN will be above 765 on Friday, but I think it's about a 50-50 likelihood from what I see right now. 

  134. Pharmboy

    RIG for IRA…..love it.

  135. Pharmboy

    RIG calendar spread, May/June 52.5 for 65c or so is a good one…..

  136. Phil

    Finally on the plane with wifi!

    Looks like 1,398 on the button for S&P futures.

  137. scottmi

    Ink – grinding is more like it..

  138. shadowfax

    Phil oil gas
    The situation is too controled and by that nothing is real or right. Gas should be higher and oil lower, we must remember balance.

  139. lolobear

    Somebody explain to me why this is wrong to do.  Yesterday, with OPEN, i bought the May 47.50 call and 40 put because the options were pricing in a 15% move.  I know either the call or the put would move and the other side would lose its value.  Came out with $1,200.  Now i'm doing the same with GMCR.  The options are pricing in a 17% move and so i bought the May 52.50 calls and the 46 puts.  Theoretically, one side is going to do really well while the other loses money.  Why wouldn't this work for all high volatile stocks during earnings?

  140. Phil

    Nokia – I don’t have my stuff in front of me. Remind me in the am

    Standing around at the airport waiting for my delayed boarding I became a customer for google glasses when they come out. Could have had a constant heads up display of my charts while doing mundane tasks. Would pay for itself I weeks!

  141. shadowfax

    Sorry all system went down at close and missed the important ticker, you can't go back.

  142. lflantheman

    lolobear….this is, of course, a long strangle.   I've tried this type of play and studied it for years around earnings.  You got lucky on OPEN, but because of the abrupt loss of value in the options the day after earnings, and the need for a big big move to make it work, it usually won't work, or at least not that often.  In general, any play on any stock around earnings can be very tricky and somewhat unpredictable.  My preference is to play stocks up to earnings, or after earnings, rather than across earnings.

  143. 8800

    Phil,
    To raise some cash despite a low Vix what about selling OTM 22 puts on BTU (despite Chanos): Sep @.70, Dec@1.28 or Jan @1.43 ?
    Thanks

  144. Phil

      4:00 PM At the close: Dow -0.15% to 13260. S&P -0.3% to 1402. Nasdaq +0.33% to 3061.
    Treasurys: 30-year +0.4%. 10-yr +0.11%. 5-yr +0.02%.
    Commodities: Crude -0.78% to $105.33. Gold -0.5% to $1654.05.
    Currencies: Euro -0.62% vs. dollar. Yen +0.06%. Pound +0.13%.

    AAPL 4:00 PM “Something big is about to happen” that involves an Apple (AAPL) product, claims a UPS source. The source adds she’s seen a major increase in Apple-related auditing and customs paperwork, and is positive it has nothing to do with MacBooks or iPads. All signs point to the next iPhone not arriving until fall. [

    ACI 3:50 PM Fitch cuts its credit rating on Arch Coal (ACI -7.2%) further into junk territory, citing weak demand for domestic steam coal and high debt levels. The move comes a day after ACI reported Q1 earnings plunged on weaker than expected demand and higher operating costs; ACI also plans to refinance its debt through a new $1B term loan with no financial maintenance covenants.

      3:38 PM Iran’s oil output has reached its lowest level in 20 years, dropping 150K bpd in two months to 3.2M bpd in April, independent data shows. Though Iran’s production was already hit by previous sanctions, the latest round targeting exports (examples: I, II) “is making things worse, reducing the amount of money Tehran itself has available to invest.”

    CHK 3:19 PM Here’s Chesapeake’s (CHK -13.5%) conundrum: CHK has been touting its shift from natural gas to liquids as a way to overcome low natural gas prices, but its production of liquids is unimpressive so far. And weak nat gas prices make it more difficult to find the funds needed to drill the wells for producing the liquids. For today at least, this explains more of CHK’s price swoon than McClendon’s antics.

    SHLD 3:15 PM Heard at the Sears Holding (SHLD -0.8%) annual meeting: Eddie Lampert says he can’t deny Sears is a real estate company before it’s a customer company, as he continues to pound out the message that the retail story can survive and a going-out-of-business sale isn’t under way. It’s not quite clear if he’s reading from the same script as CEO Lou D’Ambrosio, who says that it’s possible Lands End could be separated in a value play.

      2:56 PM The April JPMorgan Global Manufacturing PMI rises to 51.4 from 51.1, with the U.S. leading the way. The 8.9 point gap between the U.S. and EU PMIs is the greatest divergence since the EU data began being compiled in June 1997.

  145. Phil

    BTU/8800 – as long as you really want to own them. They are a great long-term hold but can’t recover until bat gas does

  146. Phil

    Time to shut off devices, which is much more frustrating when you have a. Nice wifi connection.

  147. craigzooka

    @lolobear, What happens if the stock only moves 5% instead of the 15% predicted?

  148. scottmi

    RIG/Craig – that should be good. i did similar with my kids custodial accts (which only allow covered calls) back in january. bot underlying @ 39.70, sold Jan 40 calls for 4.80. collect full year of dividends ($3.16) for total return in one year of 26% if RIG is over $40 at expiration.

  149. lolobear

    lflan/craig – you guys are right but thats why i choose the most volatile ones.  But i hear ya loud and clear. 

  150. jabobeast

    wish i was still short gmcr instead of pcln and cmg ;-(

  151. lolobear

    GMCR down 33%… that should help for me tomorrow. 

  152. BertII

    Took advantage of SVU in at 5.55 and sold Jan 13 puts and call for 2.00 not as good as the 2014s but I'm hoping Vixx will pick up a little and I can roll them and get better pricing,

  153. stjeanluc

  154. BertII

    WOW GMCR from 49.50 to 30.00 after earning going to have to look that up tonight they must have missed big time.
    I drink alot of coffee and wouldn't buy one of there machines the k-cups are way to expensive compared to a pound of good coffee,(starback 6.00 for  12 oz package with coupon)  so  i just bought an insulated caraffe make a pot of coffee and pour it in, It keeps the  coffee hot for 4 hours.

  155. jerconn

    Pharm, wow that was a nice Dis on Cannacord, really enjoyed that KMA comment…but what gives?  Why would PLX be weak in the US and why blocked in EU?  Or you think it's another Feurstein -like short attack?

  156. BertII

    Looks like all the indexes are back above 50day ma the had to focus on the RUT today

  157. lflantheman

    lolobear…..you may have hit GMCR big on those puts!   

  158. diamond

    LQMT
     
    Is Apple's Bet on Liquidmetal About to Pay Off?
     
    —--
     
    Liquidmetal Inventor: Apple Will Use It In A 'Breakthrough Product'
     
    "… there is no suitable manufacturing infrastructure yet to take full advantage of this alloy technology … I estimate that Apple will likely spend on the order of $300 million to $500 million — and three to five years — to mature the technology before it can used in large scale."

  159. Phil

    Finally settling in to my room!

    Hopefully I'll be up in 4 hours.

  160. ccsincsd

    LQMT/Facts
    As a materials, manufacturing, and engineer, I thought I'd dig a bit into the buzz about this special metal alloy.  The crap that the journalists write just kill me.  For them to guess where this alloy might be used is such crap.  Everyone thinks that a case, shell, outer body, or such is where it would be best used.
    However, here are two facts from the alloy data sheet that does not really make it a good material alternative to aluminum, yet, IMO.
    1.  The alloy is 2.18 times heavier than aluminum.  Apple makes things small, thin, and to tight precision tolerances.  They would have to make a "iphone" body less than 1/2 of its current thickness just to be the same weight.  The current shells are probably less than 0.75mm now.  Cut that in half and it is still the same weight, but now the manufacturer fights producibility, linear dimensional tolerances, flatness, and form tolerances big time.  And, what was accomplished?
    2.  The alloy is 18.17 times less thermally conductive (more insulative) than aluminum.  Moving and dissipating heat generated from the electronics is one of the most critical design aspects of almost any electronic device.  Heat is the #1 failure cause that impacts the MTBF of each and every component making up the device.  Every university, materials company, and electronic device company devotes energy towards higher thermally conductive metals, plastics, and composites for use in electronic packaging.  Less conductive is not a good thing.
    I'm sure there is something there for Apple to have made an investment.  But, I know first hand about their play money, and something does NOT have to come from their interest.  I've got no position in LQMT, but being in this field, I just wanted to share my brief digging and opinion with the PSW board group.  

  161. diamond

    ccsincsd – Thanks for your input on LQMT!  I realize that you don't know, but what would be your best educated guess on what AAPL might do with this product?

  162. drmtv10

    No position in GMCR, but seeing that they are dropping below $30 in AH, time to take a small position by selling puts, for a trade?  (Beyond headline numbers, it does not look like GMCR is being driven out of business tomorrow)  

  163. Phil

    Good morning!

    Off to a bad start as I just lost my comments by hitting the wrong key on my laptop.

    Bottom line is Asia was mixed, Europe having a party because Spain's bond auction didn't fail (they do this every time Spain has a bond auction) and our Futures are up just a little so far but commodities are weak so not a general bet on Economic recovery, just a celebration that today is not the day Spain goes off a cliff. 

    I have to write the post so please feel free to repeat any questions there and I'll catch up later. 

    GMCR crazy!

    Spain sells €2.52B of 3 and 5 year notes, at yields more than 100 bps higher than previous sales this year. The amount sold was at the top of the €1.5-2.5B range the government had hoped to move. Madrid +2.3%.

    The ECB holds its monetary policy meeting in Barcelona today. While no changes are expected to the 1% benchmark interest rate, ears will be trained on Mario Draghi's 8:30 ET press conference to hear him talk more about his call for a EU "growth compact" to complement the "fiscal compact."

    Rallying the Financials:  U.K. resistance derails efforts by EU finmins to reach an agreement to toughen bank capital rules. Ministers will try to bridge differences during the next two weeks, focusing on when countries can tighten domestic banking rules and add to EU minimum requirements on how much capital banks must hold.

    Not that it matters, but:  China's official non-manufacturing PMI shows the services sector cooled last month, pulling back to 56.1 from March's 10-month high of 58. The services sector accounts for less than 45% of China's economy, a much smaller share than in developed countries.

    The argument over the yuan's value reflects the old structure of China as a "powerful export machine" and the U.S. as a consumer of those exports, says Stephen Roach. This is no longer the case, and it's high time the debate move on to more important issues like trade and market access.

    Average home prices in 100 Chinese cities fell 0.71% Y/Y in April, the first year-on-year drop since June 2011, according to the country's largest real estate website. On a monthly basis, prices fell 0.34%, the eighth consecutive decline.

    "The biggest bubble in recent history is heading for the mother of all hard landings," writes SocGen's Albert Edwards tagging onto his bearish partner-in-crime Dylan Grice's analysis of Australia. Channeling Minsky, Edwards notes the lack of volatility in Oz's economy (no recession since 1991) leads to an excessive build-up in debt and a "bigger crash down the road."

  164. Phil

    Thanks so much for write-up on LQMT, CCS – hearing from our experts in various fields is better than reading what 1,000 idiot analysts have to say. 

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