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Friday, March 29, 2024

Tuesday Morning

Asia is mixed but holding tremendous highs, Europe is slipping a bit but nothing drastic – hopefully they are all saving up some money to put it into our markets today! All eyes on the S&P today and which side of 1,300 we end up on but it will be the Nasdaq that determines our fate and that falls squarely on the broad shoulders of Microsoft. After this weekend’s Barron’s article, a lack of follow through would be a very bad sign. Gold held up overnight at $593 as interest rates have begun moving up all over the world. Oil prices are driving an overall fear of inflation and all these factors have people talking about a “Global economic slowdown” again. This has caused oil to drop back down to $66 (down $2 from yesterday) as the phrase “demand destruction” is bandied about again. I’d really like to see oil cross and close below $65 before getting heavy on the shorts but I’ll post the ones I’m watching below as I think today might be a good day to initiate positions (I’m already in on a bunch!). I’m still in wait and see mode for the most part, maybe once we get past this week I can relax. Also, if we’re right about our oil plays then the sector will create a huge drag on the market making it hard to achieve real gains. ===================================== Oil trades – closely following the Valero Rule and no trades if oil holds $66! It might be another week before we get a real turndown, with inventory out tomorrow anything can happen… On April’s, our goal is to get out asap with a profit as expiration is looming. BP May $65 puts for .45 DO Apr $85 puts for .95 HYDL May $75 puts for $3 MDR Apr $55 puts for $1.20 MUR Apr $50 puts for .95 NBR May $70 puts for $2.50 TSO Apr $65 puts for .90 RIG May $75 puts for $1.25 SII Apr $37.50 puts for .45 XOM May $60 puts for $1.10 SU May $75 puts for $2.50 Watch gasoline as another reason not to do these trades, if gasoline holds $1.80, its rebound may pull the sector back up this week. ===================================== SEPR’s study on Lumesta looks good and the company has been beaten down enough so I like the May $50s for $3 but with a low tolerance for loss. That’s it for today, the oils took me all morning and I’m not very excited about what I see out there, really a cash day on the whole. Good trading, – Phil

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