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Friday Failure – S&P 2,500 Remains Elusive

Can we ignore more terrorism today?

I don't see why not, "only" 22 people were injured this morning as a bomb went off on a London Subway and that's nothing to the relief Japan must have felt when the missile North Korea fired over their heads turned out NOT to have a nuclear warhead – isn't that great?  Frankly, I don't know what it would take to spook this market anymore – it seems to only head up – no matter what happens.  Our President, of course, handled the incident in London with his usual compassion:

Loser terrorists must be dealt with in a much tougher manner.The internet is their main recruitment tool which we must cut off & use better!    

 

6:48 AM – Sep 15, 2017

And, of course, the UK's own right-wing leader also sent out a tweet:

Thoughts with those injured in Parsons Green terrorist incident, and thanks to police, ambulance staff and firefighters who are responding.

Image result for trump big brotherWow, this guy just doesn't get how to be Presidential, does he?  If he becomes Prime Minisister, what's he going to do in a time of crisis – HELP people?  What an idiot!  He should be blaming and grandstanding and using the incident as an excuse to call for Big Brother-like censorship.  

I mean, come on, Terrorists are people, people use the Internet, therefore – the Internet is the problem!  We've got to look into this air and water thing too – I hear the Terrorist have been breathing and drinking and we're going to have to put tight controls on both.   Wait, this just in, they were talking too!  Who's in charge of talking?  If we take away the bad words, then they can't be terrorists!  

"Newspeak is the official language of Trumpmerica, scheduled for official adoption around 2030, and designed to make the ideological premises of Conservatism the only expressible doctrine. Newspeak is engineered to remove even the possibility of rebellious thoughts—the words by which such thoughts might be articulated have been eliminated from the language. Newspeak contains no negative terms. For example, the only way to express the meaning of “bad” is through the word “ungood.” Something extremely bad is called “doubleplus ungood.”

"The particularities of Newspeak make it impossible to translate most older English (oldspeak) texts into the language; the introduction of the Declaration of Independence, for instance, can be translated only into a single word: crimethink." 

That is adopted from Orwell's 1984 with, sadly, little need for changes.  In fact, NewSpeak is already being test-run on Fox News and a large portion of America is already engaged in NewThink.  Just try talking to a Conservative about a women's right to choose, Universal Health Care or Global Warming and you'll see what I mean – there simply isn't room in their thoughts or volcabulary for contrary ideas and the funny part is – they don't even realize it!  

And when memory failed and written records were falsified—when that happened, the claim of the Party to have improved the conditions of human life had got to be accepted, because there did not exist, and never again could exist, any standard against which it could be tested.

Related imageThis quote from Orwell's Book One, Chapter VIII, emphasizes how one’s understanding of the past affects one’s attitude about the present. Winston has just had a frustrating conversation with an old man about life before the Revolution, and he realizes that the Party has deliberately set out to weaken people’s memories in order to render them unable to challenge what the Party claims about the present.

If no one remembers life before the Revolution, then no one can say that the Party has failed mankind by forcing people to live in conditions of poverty, filth, ignorance, and hunger. Rather, the Party uses rewritten history books and falsified records to prove its good deeds.  In other words, the "alternate facts" are ultimately accepted.

1984 was not supposed to be an instruction manual, folks – we shouldn't be able to draw ANY comparisons between the way our country is now and the World Orwell was trying to warn us about, let alone having to try hard to spot the few differences that remain…

This morning, the markets are getting a nice Friday bump from the Dollar dropping 0.5%, back to 91.50, where we do like it long again but it did go lower than that (/DX), so be careful playing this volatile currency.  Despite the Dollar down 0.5%, oil is only up 0.25% at $50.05 and we love oil short below $50 with tight stops above or at $50.50 we grabbed it yesterday and caught a nice run back to $49.50 overnight but still, on the whole, we're down $500 per contract for the week – as we started shorting oil too early.

We also shorted the Russell Futures too early and the trade from our Live Trading Webinar on Thursday is now 10 Russell (/TF) shorts at an average entry of 1,421.38 and it's down $940 at the moment (1,424) but we have faith there will be a sell-off – one day.  

Maybe today as August Retail Sales were down 0.2% vs up 0.4% predicted by leading Economorons.  That's only off by 150% so pretty good compared to most of their predictions and how can that possibly be bullish for oil since the whole rally is based on the IEA's BS projections of US demand growing 5%?  Well, we'll see what happens but I'm loving my oil shorts – espcecially as there is still a clusterf*ck of open contracts at the NYMEX:

Click for
Chart
Current Session Prior Day Opt's
Open High Low Last Time Set Chg Vol Set Op Int
Oct'17 49.72 50.11 49.41 49.99 07:48
Sep 15

 


-
0.10 112712 49.89 169159 Call Put
Nov'17 50.19 50.58 49.88 50.47 07:48
Sep 15

 


-
0.12 88294 50.35 531653 Call Put
Dec'17 50.51 50.91 50.21 50.81 07:48
Sep 15

 


-
0.15 18024 50.66 348752 Call Put
Jan'18 50.76 51.13 50.47 51.05 07:48
Sep 15

 


-
0.16 5823 50.89 204715 Call Put
Feb'18 50.93 51.28 50.69 51.23 07:48
Sep 15

 


-
0.17 2576 51.06 83223 Call Put
Mar'18 51.10 51.39 50.78 51.30 07:48
Sep 15

 


-
0.13 4471 51.17 165056 Call Put

We showed you this chart in our Wednesday morning PSW Report and, at the time, there were 300,216 open Oct contracts, 417,234 in Nov, 337,816 in Dec and 195,537 in Jan for a total of 1,250,803 or 1.25 BILLION barrels worth of fake, Fake, FAKE!!! orders.  At the time I told you:  

Over at the NYMEX, there are 308Mb worth of fake, Fake, FAKE!!! orders for October delivery and they all have to be rolled to longer FAKE!!! orders by next Wednesday so that's just 6 trading days to move 308,000 open contract but there are already 419,000 FAKE!!! open orders for November delivery and another 339,000 stuffed into Dec and even January has 195,000 open contracts already and that's a whopping 1.26 BILLION barrels worth of order slated for delivery to Cushing, OK – a facility that can only handle 50Mb/month.  Aside from that, consider that the US only imports a net of 5.5Mb/day so, even with 120 days to play with – that would only be 660Mb for the ENTIRE country – that's what I mean when I call those orders FAKE!!!

Image result for oil price manipulationYes, I was wrong about the total because I rounded but I wasn't wrong about the rest as today the total for the same 4 months is 1,254,279 so, in REALITY, not ONE SINGLE BARREL was actually sold – they were just shuffeled along to the forward months in order to pretend there is demand there – all in an effort to jack up the prices you suckers pay at the pumps.  And Congress does NOTHING about it!  

As citizens in a TrumpThink economy, the best we can do is make money off the manipulation and, while they have moved 131,057 contracts in two days, they only have until next Wednesday to move the rest and, don't forget, they had pulled all the stops out on Wednesday with the OPEC announcement and the IEA report and that took them from $48 Tuesday to $50.50 yesterday but only briefly as the 5% line at $50.40 was the non-spike failure and, according to our fantastic 5% Rule™, the $2.40 run gets an 0.48 weak pullback to $49.92 and a strong 0.96 pullback to $49.44 but oil gravitates to the 0.50 line, so we'll use $50 and $49.50, which is what we've been testing.  A failure at $49.50 can take us very quickly back to $48 and that's why we love the short here at $50 on /CL (with tight stops above).  

A good, bearish pattern would be for us to see that weak retrace ($50) fail and then a less than 0.20 bounce off $49.50, which would be an excellent sign we're consolidating for a good move down.  If you short all 169,159 remaining contracts at $50, at $48 you can make $338,318,000 and, if you stop out at $50.05, you risk just $8,457,950 so that's my trade of the week for people who can afford to lose $8.5M!  

Enjoy your weekend, 

- Phil

 


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  1. We might need to move up some of the lines Phil! The Must Hold line for the Nadaq is now 35% lower. Once we have seen a 35% correction, there might not be a need for a bearish confirmation.


  2. Good reference on decision making:

    https://www.farnamstreetblog.com/smart-decisions/


  3. Good morning!

    Wow, indexes blasted up at the open – what a farce!  

    Oil stubbornly holding up but Dollar below 91.50 so that makes sense.  

    Big Chart/StJ – Good point.  Hopefully I'll have time this weekend.  

    /KC having a relentless week:

    /NKD had a nice dive to just over 19,800 but quickly stopped out at 19,850.

    Still, $250 pays for the Egg McMuffins!  

    I'm going to be working on the LTP this morning, trying to be done by lunch.  Shouldn't be too many changes. 


  4. Used my MoviePass and saw "IT" last night.  Great movie.  Never read the book but have to think the adaptation was well done.


  5. Good Morning.


  6. Lines / Phil – The problem with all these indices is that they are so far ahead of themselves that guessing support lines is kind of tough. There has not been enough strong retracements to show where we tested support. Some, but not many!


  7. FU TEVA!!!!


  8. FNSR / Phil

    Been watching this a bit now and think it’s getting really intersting….  I’m contemplating allocating a 10% allocation ( with a scale) which is on the high side for me.   Would like to bounce off my thought process  and get your feedback.

    On the negative side:

    -Legacy product sales deteriorating at a faster rate than new products ( networking bus) -

    -Capital intensive company with sporadic / lumpy sales ( not sure why they don’t outsource more aggressively) limits consistent growth in rev and profit.

    -Sales are contracting and margins are getting squeezed due to the issues above.

    -Sales of the 3D product ( a new product for them) pushed out due to change in mfg process to accommodate a customer (probably Apple) this is pushing sales out at least 1+ quarters they mentioned in earnings call that sales in would be in the 10millions range then after in the multi millions two  quarters out but less than 100 M. 

    - They just hired a new CEO – will he sacrifice the next quarter in sales and other expense items? 

    On the positive side:

    -They have $1.23B in cash about 10.7 / sh, and 700 LT debt, and good FCF.

    -They still have a good business model if they can manage through the transition. 

    -Current PE at about 10 – very low for them.  They usually sit about 15 or higher.

    -If they are (3D) on the new iphone the halo effect in other industries should be significant. _

    There is some -Talk in China that Oct may bring direction on comms requirement, spurring growth – this would help legacy business. 

    At a high level with I see the ’18 / 19 years like this:  Revenue of 1.4 to 1.45B then about 1.8B.  EPS of  1.55 to 1.6/sh then 1.8 to 1.85 / sh.  EPS at 15 makes this a 25 to 30 stock at a 15X multiple.

    Using a DCF model with a 1.8 avg eps start and 5 yr 12% growth w/ 12% discount rate and BV of 12 I get a current value of 35. 

    So, my biggest worry is that in the short term given the new CEO and product transition I see added risk for a lower stock price.   In the longer term if they execute a see a 30+ stock.  Ideally I’d love to play this with a 2020 option play, but they are not available. I know you have an option play that you just adjusted.   18 / 30 BCS -  Is there any other way to position this given my concerns?

    Thanks for your help.


  9. Jeremy Corbyn is in charge of the Labour Party. Left wing.


  10. Cassini. End of Era….DSS 35 is offline.  :(.  https://eyes.nasa.gov/dsn/dsn.html


  11. Seer — is there TEVA news that made it drop again today?

    Phil--you said yesterday as long as it holds above 18 it is still bullish.

    It didn't hold this morning but maybe it recovers by the end of the day (i hope).

    If it doesn't is it then not bullish anymore?

    I guess we should have dumped it at 20 like you thought…


  12. Support/StJ – Well I usually base everything off the fair value of the S&P, which is a major bitch to calculate, which I why I keep not doing it.  I'm thinking we'll go to 2,200 but that's still more than 10% under where we are now.   Still, just because the market is irrationally priced, doesn't mean our lines should be. 1,850 was the old Must Hold and it held in 2015 and 2016 so the question is, how much more are these companies worth than they were then? 

    A quick look at Berkshire illustrates my issue with even 2,200 because they are sort of a proxy for the S&P and, one could argue, represent a better than average slice of America's top companies.  That being the case, why are their revenues only up 7% since last year and why are earnings off by a mile if things are so great?

    Year End 31st Dec 2011 2012 2013 2014 2015 2016 TTM 2017E 2018E CAGR / Avg
    Revenue $m 143,688 162,463 182,150 194,699 210,943 223,604 239,446 240,325 242,397 +9.2%
    Operating Profit $m 15,314 22,236 28,796 28,131 35,068 32,744 30,185     +16.4%
    Net Profit $m 10,254 14,824 19,476 19,872 24,083 24,074 21,806 17,364 19,313 +18.6%
    EPS Reported $ 6,215 8,977 11,850 12,092 14,656 14,645 13,262     +18.7%
    EPS Normalised $ 6,215 8,977 11,850 12,092 14,656 14,645 13,262 10,629 12,170 +18.7%
    EPS Growth % -21.6 +44.4 +32.0 +2.0 +21.2 -0.08 -14.5 -27.4 +14.5
     

    How are we at record highs on these numbers?

    FNSR/Bataman  - 10% is high, why jump in so hard?  3D sensing should be huge but we have to see if people are really excited about it in the IPhone X.  Will take a long time for it to be widely adopted but, long-term, that's good for FNSR but more so is the need for more fiber to support this massive uptick in bandwidth.  It's going to be a long process and we jumped in too early in the LTP (6/27), ahead of the disappointing quarterly report but, in general, they just pushed back the time-frame so we'll be simply spending a few dollars to roll down. 

    From scratch, I'd want to sell puts on the dip, the 2019 $23 puts can be sold for $5.25 for a net $17.75 entry so that's free money and the $20 ($5.60)/30 ($2.20) bull call spread is just $3.40 so 2x of those less 1x the short puts puts you in the $10 spreads at 0.775 each and worst-case is owning 1x at $23 but, if that's a SENSIBLE 5% of a $1M portfolio with $2M in margin ($100,000) then you can own 4,000 of those (40 contracts) and, if all goes well, you are laying out just $3,100 in cash on the $40,000 spread.  That's a nice way to get started since you make 3.7% of $1M if it goes well or you end up owning $92,000 of FNSR at $23 (+0.775 if you let the spread die).

    Keep in mind if you commit to 5 trades like that a year, you only tie up 25% of your margin and the returns are 18.5% of the portfolio with almost no cash in play (so you are ready for anything) and little PM as well.  

    Corbyn/Sun – Oops, that's right.  No wonder he cares about people.  Silly me!  

    Cassini/Latch – That's OK, it already lost that new satellite smell…

    TEVA/Jabob – Not NOT bullish, just technically concerned.  What I said was a pullback to $18 was expected after the run from $15 to $20 and yes, it went 0.19 below $18 for a few minutes so I understand your immediate need to worry.  I didn't want to dump it – just lock in the gains by selling calls, which is what sensible, non-greedy traders do after their stock pops 33%.


  13. Jabo/TEVA-don't see anything.  It ran up about 4 in the past couple of days which is a 20%+ move.  Weak pull back would be .10 strong .20.  I see about .17, but the day isn't over.  I will let Phil check my weak/strong bounce levels.  I know there has been an increase in short sales and some selling pressure, but I think it is on track.  Asset sales are progressing (see below) as well as drug approvals/research which are positive.  I'm waiting for the 2020 LEAPS to come out to do some more and hoping the price doesn't run further on me.

     

    Buyout firm CVC Capital Partners is nearing an agreement to buy Teva Pharmaceutical Industries Ltd.’s women’s health assets outside the U.S., according to people familiar with the matter. Story link: {NSN OW8CZS6S9728 <GO>}

     

    * Talks are advanced and an agreement could be reached in the next few days, 

      the people said, asking not to be identified because the deliberations are 

      private. The mostly European assets could be valued at about $800 million, 

      the people said.

    * No final decision has been made and other bidders such as Spain’s closely 

      held Chemo Group have expressed interest in the assets, the people said. 

      Representatives for Teva and Chemo declined to comment. A spokesman for CVC 

      didn’t have an immediate comment.

    * Teva, which named Kaare Schultz of H. Lundbeck A/S as its new chief executive 

      officer on Monday, is selling assets to pare more than $30 billion in debt. 

      This week, the Israeli drugmaker agreed to sell its ParaGard contraceptive 

      business to Cooper Cos. for $1.1 billion. The rest of Teva’s U.S. women’s 

      health businesshas attracted companies such as Church & Dwight Co. and French 

      buyout firm Astorg Partners, people familiar with the matter said last month.

    * Separately, Teva is considering a sale of its European oncology and pain 

      assets, which has attracted interest from companies such as Cerberus Capital 

      Management and Advent International as well as other drugmakers, people 

      familiar with the matter have said.


  14. thanks seer and phil!


  15. Phil / FNSR – thanks for the feedback and the position.   What is your price target on this stock for 18 months out?


  16. PG – in the butterfly… not replacing the expiring position at this time?


  17. Well, I'm in the weeds.

    Just had a conference call that ran way long which led to another call that ran long.  I pushed people off all week and now it's biting me in the ass.  Another reason I need to ditch Mondays! 

    Anyway, nice BS spike higher and calming down a bit but it looks like "THEY" are determined to close us out at the top, oil holding out so far but back to $49.75 and that's good for $40M on the morning trade idea – so we'll take it!  cool

    Dollar coming back slightly, 91.59.

    FNSR/Batman – Well it's $30 or I wouldn't have sold the $30 calls!  

    PG/Tangled – I thought I corrected that?  Anyway, PG in the Butterfly the short calls roll out to the next Month, same strike.

    In case people missed it, the Butterfly Portfolio Review is in last night's chat!  


  18. PG – thanks.  I thought maybe there would be a short put position too.  My mistake.


  19. Long-Term Portfolio Review (LTP) – Part 1:  At $1,606,883 our LTP is up $1,106,883 (221.4%) in 4 years and, by itself, is double the $800,000 start we had with all 4 of our tracking portfolios.  We began on 11/26/13, when the S&P 500 was 1,805 so it's up 38% over the same period while we've been compounding 40% annual gains – that's pretty good.  If we had started our hedge fund then, we'd be the best performing fund in the US by miles. 

    Still, no time like the present and just this past month, since our 8/18 review, we have gained $140,662, which is 10% of where we were ($1,466,221) then and an incredible 28% of our $500,000 base in a month.  We decided we needed to be more bullish last month and we made a lot of bullish adjustments and the market rewarded us – especially on some of our long standing value (FU) plays.  

    Yesterday we took about $30,000 of that $140,000 gain and used it to press our hedges, which helps to lock in our gains.  The STP has about $250,000 worth of downside protection if the Nasdaq and Russell correct 10% and that should mitigate most of the damage we expect to take in the LTP.  If not, the STP also has $500,000 worth of CASH!!! we can play with!  

    I will say this every month until you are whispering it in your sleep – the reason we are consistently making 40% a year is because we are Being the House – NOT the Gambler.  We have 34 spreads, 12 dividend-paying stocks and 16 short puts which are simply markers that pay us for keeping a watch list of stocks we'd LIKE to move into the other categories – IF they get cheaper.  If not – we keep the cash and move on.

    That's it – this is not complicated folks but you do have to learn to be PATIENT.  Like the Butterfly Portfolio, some trades will win and some will lose but we will ALWAYS collect our premium rents – ALWAYS.  That's good for half our gains right there and then there's the short puts and then there's our dividends and THAT is how you make 40% a year.  

    • AGNC – Like NLY, I'm concerned about REITs with the Fed hiking so let's take it off the table.  
    • ALK – Hurricane killed them for no good reason so here I want to roll our 5 short 2019 $75 puts ($9.20) to 10 short 2020 $55 puts at $4.80 and we'll add 10 2020 $65 calls for $20 and sell 10 2020 $90 calls for $9.40 so net $11.60 on the spread less $3.50 per long we originally sold the puts for and less 0.20 we pick up on the roll is net net $7.90 on the $25 spreads.  
    • ATVI – Not at all worried but let's clear the slot
    • BRK.B – Gosh I'd love to own them for $125!  Can't find any reason to take these off with 38% left to gain.  In fact, it's good for a new trade with such a silly premium on those puts.  

    • DNKN – Not worried but silly to risk.  Instead, let's cash these and sell 5 2019 $50 puts for $5 ($2,500) and see how those play out.
    • ESRX – Still good for a new trade.  
    • GPR0 – Not worried at all.
    • INFN – Not worried enough to give up 50% more.
    • NLY – These I'm worried about, let's kill this one.  Please remind me to add them to the Watch List, though. 
    • RH – I can't believe the $25 puts are still $2.33.  Fantastic as a new trade.
    • SBUX – On track. 
    • SEE – On track.
    • SPWR – Not worried enough to take the profit.   Would actually like to add a bull spread.  
    • TLRD – Just starting to ramp up.  Good for a new trade.
    • VZ – We really would like to own them for net $41.60 so on track.  
    • WATT – Their system did NOT get used in the new IPhones so down they went.  Still like them at net $7.40. 

    ARR – This REIT we sold calls against so I'm not worried.

    • CLNS – The short Jan calls aren't doing us any good at 0.05 so let's clear that slot and wait for the bounce to re-cover.  Hopefully June will be out soon.  
    • F – Way over our target.
    • FNF – Way over our target
    • GCI – Way over our target
    • GE – A bit below our target but fine. 
    • GNC – Miles over our target.

    • HOV – Right on target but let's buy back the short Jan $2s at 0.15 if we can (bid 0.10/ask 0.20) as I think they are about to move higher.

    That's how things should be in this portfolio, a few minor adjustments and a couple of profits taken to make room for more of our $5,000 monthly put sales.  


  20. HI Phil, As a "long time subscriber" I feel you have tremendously helped me in my option training.  I don't copy your trades but use them as food for thought.  One of my  concerns is when and if I cut the apron strings sort to speak.  Having  talked with a couple people about you diversifying and sort of spreading your self to thin, per your comments this morning, it brings up more thought.   Obviously it is your choice about taking Mondays off, and  I take you on your word.  Does our subscription fee drop 20%?  Sorry, but I am certain I am not the only one thinking these thoughts. I am still keeping my subscription active as I consider it of value even if I don't do futures nor some of the other avenues of investing you have introduced. Just some feed back from one of the citizens of PSW. Have  a good week end.


  21. Long-Term Portfolio Review (LTP) Part II:  I want to get back to ALK from Part 1.  We took a small position back on 7/26 so we could watch them as we thought they might go lower but, if they didn't, we wanted to at least get $3,500 for trying.  

    As it turns out, they went lower and even today lower still and maybe we hit $70 but that's OK, this is a good VALUE position and we're ready to add to our very small initial poke.  So we have rolled our 5 short 2019 $75 puts to 10 short 2020 $55 puts about even so we've collected net $1.75(ish) for each new put which is net $53.25 which is 29% below the current price.  That's now our "worst case" entry on 1,000 shares.  

    Then we're adding a small, additional, $11,600 for the 2020 $65/90 spread and we'll be THRILLED to be able to roll those $65s (now $20) down to the $55s (now $26.50) for less than $5 if ALK drops down and then we'd be in a $35,000 spread for $16,600 or less.  THAT is our plan for this trade.   It would almost be disappointing if the stock goes straight up and all we make is $16,900 ($13,400 + $3,500) vs the $21,900 if we get the sell-off we hope for – EVEN THOUGH we already own some.

    That's a tough mental state to learn to get to but it's necessary if you want to be a long-term trader who scales into positions over time.  

    And now, on to our spreads:

    • AAPL – It's essentially a new spread from our last adjustment and already doing well, despite AAPL's pulback because THE PREMIUM WE SOLD has lost a lot of money.  Again, this is not complicated folks – sell premium and win more often than you lose!   Anyway, the Sept $145 calls are still in the money but not $15 in the money, so it was a great sale and I was just speaking to a guy who owns a bunch of VZ stores and he agrees with me that the IPhone 8 is likely to disappoint as people will be waiting for the 10.  Earnings aren't until lat Oct anyway so no reason not to sell 30 Oct $155 calls ($7.10) to replace them.  If AAPL falls below $155, we will sell 20 $145 calls (now $15.70) and put stops on 20 of the short $155s. That's how we ladder in and out of coverage.  
    • AAXN – Well over our target again.
    • ABX – Our 25 long Jan $12 calls are $5.40 and the 2020 $13 calls are $5.70 so I think it's worth giving up a little position to buy 2 years of time so let's add them to the 50 2020 longs we already have and then we'll be just 2/3 covered on the remaining spread.  
    • AMGN – On track
    • BBBY – Waiting for them to come back.

    BX – On track to be called away and that's fine.  I liked them because they were on sale and now they are not so we move on.  

    • CBI – Nice comeback on these guys and back on track.  This position was down $21,000 last month and we got aggressively bullish and now we're up $9,500.  I encourage you to go back and review it as well as my commentary on Patience Plays and making adjustments – a conversation we were also having in chat at the time.  
    • CG – These guys really burned us on the short calls as they blasted higher recently.  Fortunately our spread is in the money but the Sept $15 puts and calls we sold for $3.05 are now $8.60 so we're going to eat the $5.55 and just wait to collect our spread money, which will not make up for it but there's no sense in trying to fix it – it's just a blown trade that did way better than we thought it would.

    • CHK – Having trouble at $4 but on track.  
    • CLF – On track and good for a new trade on the pullback.  In fact, let's buy back half (20) of the 2019 $10 calls ($1.05) because, if CLF goes lower, we can then sell 40 of the 2020 $7 calls (now $2.55) for maybe $3 and spend less than $1 to buy back the other 20 2019 $10 calls and then we can use the net extra $1 to roll the 2019 $5 calls (now $3.15) to the 2020 $4 calls (now $4.50).  That's what happens IF they go lower and we get the opportunity to scale into a better position.  If not, we'll only make the $15,360 we planned.  
    • CM – Man I love dividends!  On track. 
    • CMG – Another nice thing about scaling in and hedging is I haven't given these guys a though all week.  If they go up, I'm happy and if they go down, I'm happy.  As it is, they are drifting along but that's on track for us.  No one got sick recently, so that's a plus and they are rolling out their new queso.  2020s aren't out so no changes. 
    • CSCO – On track and good for a new trade. 
    • DBA – One day people will eat food again.  

    • DIN – Good for a new trade. 
    • DIS – Gotta take advantage of the dip and buy back the short Jan $105 calls at $1.60.  The 20 2019 $85 calls are up at $17.20 ($34,400) but we can trade them in for 40 2020 $80 ($23.20) $95 ($13.60) bull call spreads at $9.60 ($38,400) and those pay $60,000 at $95, which is below the current price and we can pick up additional income selling 10 short calls once in a while.  The Jan $100s are $3.30 for example and that would drop $3,300 in our pocket on a 1/4 sale against a $38,400 position and we do have time for 10 of those that can pay for our entire outlay.  Again – BE THE HOUSE!!!  Of course we're not doing it right now because we're so low in the channel.  

    • FCX – Over our goal already but it's a $12,500 spread and only net $6,692 so still a near double from here.  
    • FNSR – May as well buy back the 20 short 2019 $30 calls ($2.20) and lock in that $7,000 gain and then we'll see if it's bouncing or not.  If it is, we'll sell more expensive calls and, if not, we could sell the $30s to some other sucker and use the $2 to roll to the $23s ($4.50) but I'd rather wait for 2020s to come out. 
    • FTR – Back over $13 already is a good sign after paying us an 0.60 dividend yesterday (not reflected yet).   I'm almost confident enough to sell puts at this point but let's see next earnings first (first week of Nov).

    What a great bunch of positions and minimal effort required to manage them – that's how long-term investing is supposed to work!  


  22. Mondays/Newt – Well I won't raise fees 20% or maybe we will raise fees (it's been two years since the last raise at least) 50% and then discount them 20% if that makes you happier!  angel  I'm not going to cut Greg or Ilene's or Chris or anyone's salaries – PSW will still be there, the other authors will still be there and even I will still be here – just not always on Mondays.  As I'm trying to teach you above, a well-managed portfolio should allow you to skip Mondays – and Fridays and Wednesdays for that matter.  So how much is freeing up 20% of your time worth?  Let me know and send the balance to Greg, who will prepare the new pricing program for Phil's Getting More Out of Life World.  

    Nas pulling back a bit but other indexes flatlining at their gains.  No big sell-off on /CL yet either ($49.70 again).  Dollar stopped climbing at 91.70, which is so lame (down 0.25%).  

    /RB did it's usual weekend thing finally.  

    Less than an hour left to the NYMEX close.  

    Check out the churn today on the NYMEX – 160,000 open contracts traded 341,000 times!  It's like a huge game of hot potato.  

    Click for
    Chart
    Current Session Prior Day Opt's
    Open High Low Last Time Set Chg Vol Set Op Int
    Oct'17 49.72 50.13 49.41 49.70 13:34
    Sep 15


    -

    -0.19 341092 49.89 160272 Call Put
    Nov'17 50.19 50.61 49.88 50.28 13:34
    Sep 15


    -

    -0.07 316263 50.35 530077 Call Put
    Dec'17 50.51 50.94 50.21 50.65 13:34
    Sep 15


    -

    -0.01 119659 50.66 348359 Call Put
    Jan'18 50.76 51.16 50.47 50.91 13:34
    Sep 15


    -

    0.02 46585 50.89 204745 Call Put
    Feb'18 50.93 51.32 50.69 51.10 13:34
    Sep 15


    -

    0.04 23471 51.06 83229 Call Put
    Mar'18 51.10 51.45 50.78 51.21 13:34
    Sep 15


    -

    0.04 34504 51.17 165057 Call Put

  23. How much income you have to earn to be considered middle class in every US state

    http://www.businessinsider.com/middle-class-income-us-state-2017-9


  24. Those are some wide ranges.  $50-$150K in NJ and it very much matters where you live as parts of this state you can get by on $35,000 but near the city, $150,000 is struggling.  


  25. Phil, instead of taking Mondays off just stop answering questions about TEVA from Jabo and oil questions from craigs. :)   :)    :)    

    That would save you a days work right there.  

    Sorry guys no harm intended,  just adding a little humor on a Friday.


  26. Phil,

    I'd like your guidance on rolling an AAXN spread. I have Jan 22 (8.22, now 1.80) /30 (4.02, now .15) plus short Jan 20 puts (2.04 now .85). Not wild about the P/E but like the market dominance and solid floor (til its broken) at 21.50 and have no idea what caused the selloff  today which is concerning.

    Thinking or rolling to 1.5x 1/19 20/27, (5.20/2.40 = 2.80). Perhaps selling some 1/19 23 (4.20) or 20 puts (2.65) which have much tighter b/a spread.

    Your thoughts appreciated.


  27. Looks like NLY ex-dividend date is 9/28.  For those of us with stock and in the money on short calls, is it worth waiting to get the dividend or is more than likely to be called away?


  28. Long-Term Portfolio Review (LTP) Part III:  Coming into the home stretch now!   It occurs to me that we did add a couple of new positions that are missing – I will fix over the weekend.  

    • GILD – Well, that one is all fixed!  It wasn't bad last month, up about $11,000 but now up $20,000 but it's a $30,000 spread (with 5 open calls) and we paid net $3,000 for it so "on track".  Fortunately, we've moved on to TEVA, which was the next perfectly good company to come under attack, preying on investors who don't understand the complexities of debt financing but, for some reason, invest in those kind of companies anyway.  
    • GM – Unlike the OOP, we have TONS of cash and margin sitting around so it would be foolish to cash in this $35,000 spread for net $23,510 as we still have almost 50% to gain from here.
    • GME – Glad we bought back the short calls!  Kind of obvious coming into Christmas….

    • HBI – Over goal already.  
    • IBM – Pretty new, still good for a new trade.  
    • IMAX – Another one we followed through with and got more aggressive on the sell-off that's paying off already.  

    • LB – Still my leading contender for the 2018 Trade of the Year at $40.  On track for our purposes.
    • M – So glad we bought the in-the-money calls, they gained almost the whole $2 on the way up while the short calls are essentially flat!  On track.
    • OIH – Well the short $30 calls are toast but I'm not ready to sell more yet so we'll wait and see.  

    • PSO – On track for our conservative play but that's not good as we thought $7.50 would be easy to hold.  We'll just keep an eye on them.  
    • QCOM – On track but, while they are still low, our 10 2019 $45 calls are $9.70 and the 2020 $40 calls are $14.10 so that seems worth the roll as we buy a year and $5 in position for $4.40.  Let's also buy back 5 (half) of the short 2019 $55 calls ($4.60) to give us more room to run.  
    • SKT – Wow, I forgot about these guys.  I love this trade and they pay a 5.6% dividend.  Great stock (mall REIT).
    • SVU – Waiting for BABA to buy them.  Good for a new trade. 
    • TEVA – A little bit of a bounce but miles to go before we're happy.   If we fail $20 on the next move up we need to cover with 1/2 the Jan $20 calls, now $1.10.  
    • TGT – On target!
    • THC – I'm not enthusiastic about these guys and we're lucky to have a profit so let's close the bull spread and leave the short puts.  
    • TWTR – Back in the black and on track. 
    • UNG – Will this trade ever pay off?  I still like it long-term and I'd hate to miss it if it finally pops so we'll just leave it alone.  
    • WPM – This year's Trade of the Year is on track and we can sell 2019 $20 puts for $3.15 so let's sell 20 of those while we wait for the Jan $15 puts to expire.  That's where most of our gains on this trade came from – the short put side!  

    That's nice.  Just a couple of adjustments and not urgent.  On the whole, I don't like having so many bullish positions but what else can you do in a market that hasn't had a down month all year.  We'll just keep playing it until it breaks and then hope our STP has enough hedges to cushion the fall.  

    As I said, we have $250,000 of downside protection but that's not so much for a portfolio that gained $140,000 in 4 weeks and, even as I wrote this review, we hit $1,612,000 (no changes from the morning) so that's +$6,000 since noon!  If you can gain money that easily, you can lose it just as easily – always remember that and take some off the table and insure the rest!  


  29. Phil:  I have a DIS Jan 18 85/100 spread that I can close right now and make $2.27 on.  There is the potential for another $4 if DIS closes over 100 in January.  I love DIS, think it is cheapish and am all for selling Jan 2020 puts.  Nonetheless, DIS is under a cloud right now and the market is terrifyingly high. Should I take my profit and run and/or open some 2019 spreads with the proceeds?  Roll to April?  What do you suggest?  Thanks.


  30. ROFL Stock!  I wouldn't know what to do with my free time…  blush  

    AAXN/8800 – Well I'm still confident:

    [$$] Final Holdouts May Soon See Police Use Tasers

    Taser is constantly investing to keep ahead of the competition and tight margins worry investors but, like AMZN, "they can make money any time they want to".   You waited a bit long as the Jan $22s ($1.95 was last) is well below the $4 net of the spread.  The $30s will go worthless so I'd just roll out to the 2019 $20 ($5.30)/27 ($2.40) bull call spread at $2.90 so paying +0.95 + the $4.20 you started with puts you in at $5.15 less the $2.04 on the puts is $3.11 on the $7 spread that's $2.40 in the money – seems fine to me.  The short puts will go worthless so I wouldn't roll them and, if you can't double sell then I'd wait.  Otherwise, the 2019 $20 puts are $2.60 but maybe if you wait the 2020s come out.  

    NLY/Rperi – Well you get 0.30 in a month and the stock can move more than that but, if you are so well covered that you are worried about being called away, then why not wait for the dividend – in case you get it?  

    DIS/John  - You can take $15.40 off the table by selling the Jan $85s now and that's more than the spread pays and you can use that money to buy 2020 $90 calls ($16.40) for $1 more and that buys you 2 years of growth and, when you are ready, you can take half off the table by selling calls (the $105 calls are $9, the $110 calls are $7).  


  31. Oil pushing for $50 again:


  32. Rustle – IT – "Never read the book but have to think the adaptation was well done."

    Not, Pennywise says read the book.  The 1990 film version held somewhat true to the 1986 book. Linear thinking in this two part adaptation, no flash backs or forward leaps. That oscillation between decades from child to adult hood and back, made the EVIL infecting their lives,  a TIMELESS terror. 

    The temporal proximity or anchoring defeats the scariest element King intended… that child hood monsters don't just disappear when you GROW UP. Now before you shut out the light, look under the bed tonight, there might be a TRUMP clown waiting.  Time for my IV, they all float down here and Out.


  33. Phil:  Thank you for your response re DIS.  Just to be sure I've understood you.  So if I sell my Jan 18 85 calls and buy the 2020 90 calls in their place, you are suggesting leaving my short Jan 18 100 calls in place, and hoping they expire worthless or rolling them until they do.  Then, once my short Jan 18 100s are out of the way, you are suggesting that I sell a new short call to create a 2020 spread when the time is opportune.  Have I understood you correctly?



  34. Phil,

    Thanks for the guidance on AAXN. Yep, I did miss the $4 roll point. Concern about the 70 p/e made me hesitate overly long. Thanks for the rolling math – a thing of beauty.


  35. Sold some TUES at $2.50.  Purchased in June at $1.85.  Also sold some Mar 18 2.50 calls for .60.


  36. DIS/John – Yes, that's right.  You can roll them to much higher 2020 calls or just roll them up $5 per Q until you get lucky or you get to 2020 anyway (9 x $5 from now!).  Either way, you have significantly reduced the rate of premium decay you have vs your short caller, which is key.  

    1,430 on /TF.  angry

    Why should the market care?

    • Following this morning's soft retail sales and industrial production numbers for August (likely impacted by Harvey), the Atlanta Fed tracker is seeing just 2.2% GDP growth in Q3. That's down from 3% a week ago, and only about half of the forecast six weeks back.
    • Goldman Sachs is also slashing its Q3 forecast post-Harvey and post-Irma, now seeing just 1.6% growth vs. 2% previously.
    • Aug Consumer Sentiment: 95.3 vs. 96.0 expected and 96.8 prior.
    • Current economic conditions 113.9 vs. 110.9 prior.
    • Index of consumer expectations 83.4 vs. 87.7 prior.
    • Aug. Industrial Production: -0.9% at 104.7 vs. +0.1% consensus, +0.4% prior.
    • Capacity utilization: 76.1% vs. 76.7% consensus, 76.9% prior (revised).

     Walgreens-Rite Aid deal said to be moving forward

    • Rite Aid (RAD +5.8%) and Walgreen Boots Alliance (WBA +0.8%) break higher after new reports indicate that the FTC is prepped to let the 2,186-store deal fly through without a second review.
    • Fred's (FRED +6.9%) is also notably strong on the day.
    • While the RAD-WBA deal has taken several twists and turns to send shares prices on a roller coaster ride, the issue should be settled soon with the FTC due to make a decision before September 18.
    • Sources: Capitol Forum and StreetInsider.com
    • Netflix (NFLX +0.1%) continues to drive forward in its push to build itself into a major Hollywood studio, writes Bloomberg's Lucas Shaw.
    • He observes that the ultimate goal of Netflix is to become the world's largest creator of entertainment and cut short the need to pay as much for licensed content.
    • Though Netflix currently spends about $16B on content, most of its commitments are for less than five years. The short contract duration sets ups the company up to rely on its studio to a greater extent in the future.
    • Netflix's studio ambitions extend beyond Hollywood. Chief Content Officer Ted Sarandos is busy making deals abroad for more original content.
    • It's not even a rounding error compared to the 143M U.S. consumers, but nevertheless, up to 400K citizens of the U.K. may have been affected by the cyberattack on Equifax (EFX -5%), says the company. At even 400K, it would still be the largest U.K. data breach ever.
    • U.K. customer data was stored on U.S. systems between 2011 and 2016.
    • Equifax is now lower by about 36% since disclosing the incident one week ago.
    • In other news, Brett Arends takes note of the apparent lack of educational qualification of Equifax's chief security officer – she has a bachelor's and master's degree in music. She does, however, have a long professional career, including a stint as chief security officer at First Data.
    • Valero Energy (VLO +2%) CEO Joe Gorder says the company is "aggressively pursuing" new business opportunities created by Mexico's energy reforms that have opened its markets to foreign competition.
    • "Valero does a lot of business in Mexico but with the reforms that have been implemented, we can now not only sell the barrels to Mexico but we can control the barrels and own the barrels in Mexico and move them further inland," Gorder says.
    • VLO has been selling gasoline, diesel, jet fuel and other refined products to Pemex, Mexico's national oil company, where were in turn sold at gas stations and other outlets under the Pemex brand; as part of the energy reforms, VLO can now sell its own products under its own brand.
    • "With the investments we're making and with the strategy we've got underway now to try to push our branded business further into Mexico and to increase our unbranded business, we're going to try to grow in that direction," the CEO says.
    • A new forecast from the National Hurricane Center has Tropical Storm Jose heading towards the Northeast part of the U.S. by next week and potentially strengthening back into a hurricane.
    • The 5-day cone includes parts of New Jersey, New York, Connecticut, Rhode Island and Massachusetts.
    • Bloomberg New Energy Finance meteorologist Shunondo Basu says vessel delivery on the Atlantic seaboard could be disrupted due to Jose.
    • Semiconductors going strong this afternoon with the Philadelphia Semiconductor Index currently up 1.65% and nearing its highest close since 2000.
    • Nvidia (NVDA +6%) and Micron (MU +0.7%) are both up from analyst upgrades while Broadcom (AVGO +1.4%) and Skywork (SWKS +1.9%), as Apple suppliers, benefit from this week’s launch event and today’s preorder opening.  
    • Previously: Evercore ISI raises Nvidia price target (Sept. 15)
    • Previously: Goldman Sachs upgrades Micron Technology (Sept. 13)
    • DRAM prices could jump 40% this year, according to IC Insights, after already doubling in the past year.
    • IC Insights notes that tope DRAM players Samsung, SK Hynix (OTC:HXSCFOTC:HXSCL), and Micron (NASDAQ:MU) have recorded record profits due to the tightened supply and price hike. Micron reported $1.65B in net income in Q3 on $5.57B in sales for a 30% profit margin. 
    • When DRAM supplies get tight, one or more suppliers usually break away and start adding production capacity to get more of the market and strike while the iron is hot. 
    • Micron has no upcoming plans for adding DRAM wafer capacity instead focusing on increasing output through feature size and die size reductions.
    • SK Hynix does plan to add DRAM wafer capacity while Samsung remains mum on the subject.  
    • Previously: Goldman Sachs upgrades Micron Technology (Sept. 13)

    • The next version of Google’s (GOOGGOOGL) Chrome web browser will limit autoplay videosto those that don’t include audio or the browser thinks the user would want to watch the video
    • Chrome would determine likely user interest by factors including watching videos on the site before or the topic in the video.
    • For the new service to work in mobile, Google needs to remove the existing autoplay blocking options. 
    • Both versions of Chrome will offer the ability to permanently block autoplay ads from specified sites. 
    • Autoplay blocking will start in Chrome 64 beta in December and move to Chrome 64 stable in January.  
    • Previously: Google roundup: Assistant coming to Europe, CBS to Home, permanent muting to Chrome (Aug. 25)
    • With new iPhones hitting ever-higher price points, promotions from U.S. wireless carriers aren't as big as last year's -- but they're still bigger than Oppenheimer expected.
    • AT&T (T +1.2%) took the uncharacteristic lead with a buy one/get one free offer, and with DirecTV Now in its pocket as a carrot (and T-Mobile (TMUS -0.4%) throwing in Netflix subs), the prospect of including over-the-top video has analyst Timothy Horan and team expecting more promotions ahead.
    • "We do expect higher churn for the remainder of the year for the wireless industry and for higher phone upgrades as a percent than we've seen in several years," Horan and team write.
    • While we have lowered our wireless margins for T and VZ for 4Q17, they still should not decline as much as we saw in 4Q16 as both carriers have moved to unlimited (more happy customers and lower costs from billing/customer care/churn) and have more EIP and are slashing expenses, and phone subsidies remain below last year's for now.
    • Oppenheimer is increasing estimates for AT&T's net adds, and lowering EPS estimates for AT&T and Verizon (VZ +1.1%).
    • Sprint (S -1.2%) is among the lighter promoters, offering a half-off lease on iPhone 8 and 8 Plus for those trading in an iPhone 7.
    • Airbus (OTCPK:EADSFOTCPK:EADSYfaces years of investigation by French and U.K. authorities into allegations of corruption over jet sales rather than the quick settlement discussed in some media reports, according to Reuters.
    • The London-based Evening Standard reported British and French prosecutors met last month to discuss the terms of a settlement following a probe into the use of middlemen to sell jetliners.
    • The U.K.'s Serious Fraud Office launched its probe in August 2016, followed seven months later by France's PNF, which legal experts say makes it a relatively young investigation for such a complex case; in addition, some say the French investigation could slow down the process as the two agencies cooperate for the first time.
    • Some analysts say Airbus could nevertheless face a record fine once the proceedings have played out.
    • Bain Capital says Apple and Dell have joined its consortium that stands as the lead bidder for Toshiba’s (OTCPK:TOSBFOTCPK:TOSYY) chip unit.
    • Seagate Technology (NASDAQ:STX) and Kingston Technology have also joined the consortium.
    • Bain says its new friends will “provide capital in a sign of industry-wide support for an independent Toshiba” but didn’t disclose what each company would contribute, which is likely still under negotiation.
    • There’s still the problem of Western Digital (NYSE:WDC), which continues a legal fight to block the chip unit sale without its permission and leads a different consortium that was considered for the bid. 
    • SK Hynix also belongs to Bain’s group and has raised concerns about a competitor from a foreign country getting access to Toshiba’s tech.
    • Toshiba says it hasn’t fully committed to Bain’s group yet but needs to finalize a winner soon to avoid a March delisting. 
    • Western Digital shares are up 3.68%.       
    • Seagate shares are up 1.47%
    • Previously: Toshiba’s statement on Western Digital chip right claim (Sept. 14)
    • Ballard Power (BLDP +2.9%) moves higher after H.C. Wainwright doubles his stock price targetto $6 from $3, citing expectations for order book growth, increased certainty of execution in China, acceleration towards profitability and favorable macro trends.
    • Wainwright says it liked the bullish tone at BLDP's analyst day, in which the company said its 12-month order book rose to $97.2M vs. $87M that was previously announced for FY 2017 deliveries.
    • BLDP shares have surged ~20% since Tuesday night's announcement of a technology breakthrough that replaces most of the high-cost platinum used in earlier designs.
    • BLDP, which has been trying to reduce the amount of platinum from its products, says its Non Precious Metal Catalyst design to be offered by year-end will reduce the amount of platinum by more than 80%.
    • GNC Holdings (NYSE:GNC) is up 3.66% on the day and 13% for the week as it tracks back close to double-digits again.
    • Earlier today, Seeking Alpha Marketplace author Jason Phillips wrote there is evidence that the new turnaround strategy at GNC is taking hold.

  37. You're welcome 8800. 

    Well, that was disappointing but non unexpected on an OpEx day.  We'll see what happens Tuesday (Monday doesn't matter).

    Have a great weekend, 

    - Phil


  38. Phil

    We may want to look at the other Commodities

     The Massive Impact of EVs on Commodities in One Chart

    http://www.visualcapitalist.com/massive-impact-evs-commodities/


  39. Thanks Phil.  Have a great weekend everyone!




  40. Hurricane Jose may threaten Northeast next week


  41. Phil,

    Are you still holding /tf shorts?


  42. China’s crackdown won’t kill cryptocurrencies — but it will have an impact








  43. Ilene – GW and CC – read these two strings for educational value.

    Does positive feedback necessarily mean runaway warming?  Interesting discussion re: 

    Paleocene-Eocene Thermal Maximum (PETM); find Leland Palmer's comments.

    CO2 lags temperature – what does it mean?  Interesting discussions re:

    800K years of ice cores, deuterium traces, does CO2 lag temperature? Yes. Thus not responsible for GW or is that an incorrect assumption?  Yes.

    Cyclical Earth orbital and tilt changes cause GW, human-caused origin (anthropogenic) CO2 has augmented and disrupted the equilibrium of the current cycle.


  44. Phil when do they update the open contracts on oil because it is still showing 160k (000) which can't be right. Do you see a more up to date number anywhere?


  45. Ok just saw that the number moved down to 132.6k which is still pretty high with 3? days left. Is it 3? 


  46. Hola people!  

    Hope we all had a nice weekend.  

    Nothing too exciting in the Futures so far – just drifting along.  

    Great chart, QC, we should use it to our advantage.  

    /TF/Japar – Sadly yes, still short 10 at about 1,425 avg.

    Fed/Latch – Wow, that is ridiculous isn't it? 

    Tilts/Naybob – Those tilts are 100,000 year cycles, they would never give you noticable measurements like we're seeing now.  Yes, the earth was once lava and then then it had an ice age and then it warmed up but that is NOT what this is. 

    Oil/Craigs – Gave me a heart attack because TOS rolled the front-month and showed an 0.50 jump!  On the NYMEX I'm not seeing 132,600:

    Click for
    Chart
    Current Session Prior Day Opt's
    Open High Low Last Time Set Chg Vol Set Op Int
    Oct'17 49.85 49.88 49.76 49.78 18:08
    Sep 17

     


    -
    -0.11 520 49.89 132600 Call Put
    Nov'17 50.39 50.43 50.30 50.32 18:08
    Sep 17

     


    -
    -0.12 685 50.44 550284 Call Put
    Dec'17 50.70 50.79 50.66 50.70 18:08
    Sep 17

     


    -
    -0.11 265 50.81 348053 Call Put
    Jan'18 51.04 51.04 50.96 50.96 18:08
    Sep 17

     


    -
    -0.13 75 51.09 213855 Call Put
    Feb'18

    -

    -

    -
    51.26 * 18:08
    Sep 17

     


    -

    -

    -
    51.30 87940 Call Put
    Mar'18 51.40 51.40 51.30 51.30 18:08
    Sep 17

     


    -
    -0.14 48 51.44 166809 Call Put

    It's a manageable 40K/day so not too much pressure on /CLV7 but, on the other hand, they only moved 37,000 on Friday on a bullish day – so not too impressive.  

    Yes, 3 days.  


  47. Phil/CL – got notice from IB that last trading time is Tuesday 9.30 am EST.


  48. Phil

    Same idea but batteries

    Explaining the Surging Demand for Lithium-Ion Batteries

    http://www.visualcapitalist.com/explaining-surging-demand-lithium-ion-batteries/



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  59. Good morning!  

    Oil coming down a bit and we'll see how that goes.  I'm still looking for a $1+ sell-off by Weds but they are spreading all the BS news they can to keep it up, which is also to find idiots to take those Oct contracts off their hands so they don't have to roll them and eat the cost.  

    IEA Sees Risk of Volatile Oil Prices on Weak Upstream InvestmentA dearth of new investment in oil production is stoking a risk of tighter crude supply and unstable prices, even as demand growth is expected to slow over the next five years, according to a senior International Energy Agency official. The worldwide cushion of spare production capacity will shrink without further investment in exploration and output, Neil Atkinson, the head of the IEA’s oil markets and industry division, said Sunday at a conference in Manama, Bahrain. “There are still not enough signs of investment beginning to return, and that raises the risk of tightening of the market in the next five years and a risk to the stability of oil prices,” he said. “There is at least a possibility of going back to the situation we had 10 years ago where oil prices were very, very high at a time when demand was growing.”

    The other huge line of BS is that there will be an uptick in demand as refineries come on-line.  Yes, to make up for the huge build they ignored because it was only because refineries were off-line.  These guys want to have it both ways!  Oh, and finally the market catches up to our premise on refiners:

    Hurricanes Stir Up Profits for RefinersEven refinery owners with flooded plants could see an improvement to their bottom lines.

     

    • Energy stocks just wrapped up their strongest week of 2017 to cap a four-week winning streak, and CNBC reports some portfolio managers think the rally could have more room to run.
    • While U.S. crude oil is ~7% lower this year, the Energy Select Sector ETF (NYSEARCA:XLE) has fallen 12.6%, a fairly large spread that Tortoise Capital's Rob Thummel thinks could mean some catching up is ahead; he notes some of the week's biggest winners were some of the year's biggest losers: RRC -46% YTD, CHK -43%HP -35%NFX -33%APA -33%.
    • The end of this year is starting to look like the final months of 2016, when a weak energy sector surged to become the top performer of the S&P 500, says Tamar Essner of Nasdaq Corporate Solutions.
    • SunTrust's Neal Dingmann notes short interest in the E&P industry is at its highest since late 2015, with JONE and SN currently more than 30% short.
    • Fundamentals also look promising, says Jay Hatfield of Infrastructure Capital Advisors: economic growth is boosting energy demand; a weaker dollar makes dollar-denominated oil more affordable; and the price gap between Brent crude and WTI has widened, which encourages U.S. oil exports.

    That's the /CLX7 now, /CLV7 is $49.81 so about an 0.50 rolling cost is very painful.

    Brent $55.50 and /RB calming down from $1.75.

    Honey badger don't care:

    Dollar weak too:

    Pound with a 2.5% move off Thursday's open

    No break on /TF, relentless at 1,435 with /YM 22,300 (and that's a good short line), /ES 2,504 (below 2,500 confirms short premise) and /NQ 6,007 – so we certainly have good lines to use for shorting – or going long for that matter but I still think that move was BS last week.

    Won't know until tomorrow because Monday's are BS too.

    No one seems worried, though:

    • Notable earnings: AutoZone (NYSE:AZO), Adobe (NASDAQ:ADBE), Bed Bath & Beyond (NASDAQ:BBBY) on September 19; General Mills (NYSE:GIS) and Farmer Brothers (NASDAQ:FARM) on September 20; Presidio (NASDAQ:PSDO) and Scholastic (NASDAQ:SCHL) on September 21; Finish Line (NASDAQ:FINL) and CarMax (NYSE:KMX) on September 22.
    • IPOs expected to price: Zai Lab (Pending:ZLAB), Despegar.com (Pending:DESP), Celcuity (Pending:CELC), Krystal Biotech (Pending:KRYS) and Best (Pending:BESTI) on September 20.
    • Secondary offering lockup expirations: Financial Engines (NASDAQ:FNGN), Ring Energy (NYSEMKT:REI), WageWorks (NYSE:WAGE), Spark Therapeutics (NASDAQ:ONCE) and XPO Logistics (NYSEMKT:XPO) on September 18; Determine (NASDAQ:DTRM), Sangamo Therapeutics (NASDAQ:SGMO), Avexis (NASDAQ:AVXS) on September 19; EnSync (NYSEMKT:ESNC) and Alteryx (NYSE:AYX) on September 20; Cotiviti (NYSE:COTV) on September 22.
    • Notable annual meeting: Darden Restaurants (NYSE:DRI) and Nike (NYSE:NKE) on September 21; ConAgra (NYSE:CAG) on September 22.
    • Business update call: Argos Therapeutics (NASDAQ:ARGS) on September 20.
    • Sales update: Raymond James (NYSE:RJF) on September 20.
    • Special shareholder meeting: Intuitive Surgical (NASDAQ:ISRG) and Commerce Bancshares (NASDAQ:CBSH) on September 21.
    • Analyst/investor meeting: Adamas Pharmaceuticals (NASDAQ:ADMS) on September 18; Big Lots (NYSE:BIG), Carbonite (NASDAQ:CARB), CDW (NASDAQ:CDW), Humana (NYSE:HUM), Best Buy (NYSE:BBY) and National Health Investors (NYSE:NHI) on September 19; Pilgrim's Pride (NYSE:PPC), Unisys (UIS) on September 20; Rambus (NASDAQ:RMBS) on September 21.
    • FTC Hart-Scott-Rodino expiration: Walgreens Boots Alliance (NASDAQ:WBA) and Rite Aid (NYSE:RAD) on September 18.
    • FDA watch: Companies that could hear from the government agency include Mylan (NASDAQ:MYL) on Copaxone, Valeant Pharmaceuticals (NYSE:VRX) on latanoprostene bunod CRL and Alnylam Pharmaceuticals (NASDAQ:ALNY)-Sanofi (NYSE:SNY) on patisiran.
    • Hurricane reset: Investors are expected to continue to adjust to the impact from Hurricanes Harvey and Irma after a week that saw significant upward moves for restaurant and insurance stocks. Fundstrat suggests that value stocks like Comcast (CMSCSA), FedEx (NYSE:FDX), Procter & Gamble (NYSE:PG), IBM (NYSE:IBM), Merck (NYSE:MRK), Emerson Electric (NYSE:EMR) and Dollar Tree (NASDAQ:DLTR) are the type of names that could see interest with the Fed potentially in a holding pattern. Traders are also keeping an eye on Tropical Storm Jose in the Atlantic with it forecast to threaten the East Coast next week after strengthening.
    • Barron's mentions: Volkswagen (OTCPK:VLKAY), China Mobile (NYSE:CHL), Frost Bank (NYSE:CFR) and MLPs are called out as enticing investment picks. Meanwhile, there is plenty of debate both ways on FedEx, Goldman Sachs (NYSE:GS) and the FANG gang of four – Facebook (NASDAQ:FB), Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX) and Google (GOOGGOOGL). The publication also suggests watching lumber plays.
    • Sources: EDGAR, Bloomberg, Nasdaq.com.

     

    • Three storms are raging in the Atlantic, with Hurricane Maria forecast to rapidly strengthen and aim for the islands devastated by Irma.
    • A weakened Hurricane Jose could graze the Northeast midweek, while Tropical Storm Lee formed in the eastern Atlantic Ocean on Saturday.
    • According to the U.S. National Centers for Environmental Information, this will be the second most costly year for hurricane damage since 1980 behind 2005.

    World's Central Banks Can't Ignore the Bitcoin Boom, BIS SaysThe world’s central banks can’t sit back and ignore the growth in cryptocurrencies as it could pose a risk to the stability of the financial system, according to the Bank for International Settlements.

     

    • Hiking interest rates could mean a hit to global growth, according to the latest quarterly report from the Bank for International Settlements.
    • The central bank of central banks said policymakers face a delicate balancing act as they try to wean markets and businesses off extraordinarily cheap money, and called the mix of low inflation and increasing global growth the "trillion dollar question."

    The U.K.'s Economic Outlook Is Getting Rosier

    Eurozone inflation to slide below 1%?

    • The eurozone inflation rate is likely to slide below 1% early next year due to volatile developments in oil and unprocessed food prices.
    • It's an awkward development for the ECB as it prepares to wind down its giant monetary stimulus.
    • Meanwhile, inflation across the bloc rose 1.5% in August, heading closer to the central bank's target of just below 2%.
    • Euro +0.1% to $1.1946.

     

    Northrop(NOC) Nears Deal in $7.5 Billion Range for Orbital(OA), WSJ Says

    Dozens arrested as second night of St. Louis protests turns violent

    Protesters Smash Windows, Throw Bricks At Cops In Second Night Of St. Louis Violence

    Trump agrees stronger North Korea sanctions needed, South Korea says

    Haley Warns World: Mattis Will "Take Care" Of North Korea If Diplomacy Fails

    Great, we're too crazy for Pakistan now!  Pakistan warns of dropping F-16 purchases

    • New Pakistani Prime Minister Shahid Khaqan Abbasi has warned the Trump administration that it risks fueling terrorism in the region and undermining military efforts in Afghanistan if the U.S. follows through with a threat to downgrade its relationship with Islamabad.
    • He also warned of dropping the U.S. as a supplier of military aircraft, like Lockheed Martin's (NYSE:LMT) F-16, which has become the mainstay of the Pakistani air force

     

    • In a deal worth several billion dollars, BAE Systems (OTCPK:BAESY) will benefit from Qatar's purchase of 24 Typhoon jets after the company said it may have to cease production of the combat planes in 2019 absent additional export orders.
    • The agreement, however, is likely to peeve neighboring Middle East countries that are in a spat with Doha over its ties to terrorism and Iran.

    This Could Take Years" Feinstein Confirms Trump Jr. Will Give Public Testimony This Fall.

    Long-Term Mortgage Delinquencies Seriously Under-Reported

    BIS Finds Global Debt May Be Underreported By $14 Trillion

    UBS: These are our top 5 picks for tech stocks

    New EU plan to tax digital giants

    • EU finance ministers from 10 countries are supporting a plan to start taxing the revenues of digital giants like Google (GOOGGOOGL), Amazon (NASDAQ:AMZN) and Facebook (NASDAQ:FB), instead of them being taxed on profits that they currently report in often low-tax countries.
    • But as all members have to agree on any plans to change EU taxation rules, the ministers agreed to take up the issue again in their meeting in December "to reach a common understanding."

  60. Tuesday/Ravi – I think that's when IB stops letting you trade the contact as they don't want anyone stuck with barrels being delivered to them.  If the NYMEX traders only have today to dump 130Mb – there would be fireworks!