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Which Way Wednesday?

Happy Valentine's Day!  Let's hope we can avoid a massacre!

It's another tricky day for the markets and let's pray we can end this day loving our stocks or we may all be heading into a bitter, messy divorce on a pullback.

Usually coming off a nice up day like yesterday I'm just hoping to hold our levels but these are not levels we want to hold.  If we hold here – these "levels" become TOPS!   I wrote an article back in December about how hard it was to break orbit and I recommend it to new readers

 

At the time I predicted that Paulson and Bernanke's trip to China would be a success and we would be rewarded for flooding the world with dollars, even though everyone was panicking as China had just passed the Trillion dollar mark.  That was 350 Dow points ago and it's now time to put up or shut up if we're going to break 12,700.

It's all up to Chair Man (my superhero name for Bernanke) as he and Super Banker (Paulson) work their magic this week in what I think looks like an optimum time to kick the markets up to a new level.  While Bernanke likes to play tennis with the markets, enjoying the long volleys back and forth and waiting for the right moment to put a little spin on the ball, Paulson is more of a sniper and he likes to make a kill shot and move on.  I think window may be right to kill the commodity rally but that will only happen if Goldman is done with it so today will give us some VERY telling signals.

DCX's Mercedes division is just plain tired of carrying Chrysler around like Marley's chains, so it would be a hell of a trick today as the markets will be haunted by the closing of 3 US auto plants and 13,000 job cuts.  When questioned about providing benifits to the workers, Dick Cheney said: "Are there no prisons, are there no workhouses?  If they are to die then they'd best do it quickly and decrease the surplus population!"  Oh wait, that might have been Scrooge - I get those two mixed up sometimes (Scrooge is the one who changed for the better).

If we can get past this bad news, I think we'll be in pretty good shape.  No matter what the crude inventory reports show today, we are probably going to have a big build in crude and gasoline next week as a big chunk of America takes a day off due to today's storm.  In a country that uses of 20M barrels of fuel a day, taking a day off from driving and flying for just 20% of the population can back up 3M barrels.

Asian markets were led higher by Australia, who posted a new ATH, led higher by miners and other commodity producers as bets piled up against the dollar all around the world.  SNE gained 4% in Japan as all those cheap semiconductors have led Sony to decide not to bother making their own anymore.

European markets are pretty flat.  UBS had my favorite kind of earnings, the kind that sound bad but are actually great!  Income declined 47% but that's because last year they had a huge gain from the sale some private banking assets.  Even without those revenues, total revenue was up 15% and the company will be buying back 10% of its shares as they are way too cheap.  We're going to let this come in and then make a long-term play.

A holding pattern is just not good enough and we'll be taking some protective puts if we don't get a breakout today.  We can afford to be wrong and have the markets rally but it would be very sad to get caught on the wrong side of another 200 point drop:

  • Dow needs to break 12,700! Not today but every day must show progress.

  • S&P needs to retake 1,450.
  • NYSE needs to prove it's a leader by taking out 9,400Below 9,300 is no longer acceptable.
  • Nasdaq must retake 2,475 but so what?  Until we see 2,500 hold for a week, this is still one very woozy canary! 

    • SOX 460 must hold – this is sick canary number 2!  470 is our magic number, and that's only because we've scaled back expectations following a sort of Moore's law of diminishing SOX returns as they get 10x more pathetic each quarter.
  • Russell is our co-leader and  810 needs to hold - 820 would be an authoritative move up.

I know it's a lot to ask but fool us 4 times and we have to start admitting we're just fools!

TOT had a drop in Q4 profits.  Why?  2% production cuts of course – these are the sacrifices one must make as a shadow member of OPEC…  Without beneficial gains from 13% ownership of SNY, the company dropped 10% this year vs. last year as costs climb (see Zman's post on the subject) and demand falls.  Total pledges to increase output by 6% next year (+150Kbd), bad news for Saudi Arabia who can't afford to let their coalition of the willing fall apart on them.

Projections for oil today are for a 1.6Mb build in crude, a 1.8Mb build in gasoline and a 4.6Mb draw in distillates.  Just worry about the net (-1.2Mb) but, by next week's inventory, winter will be looking over with "summer driving season" still 3 months away.  Since hardly any NYMEX barrels have actually been used for 3 months (almost all contracts have been rolled forward as we tracked them) we could end up with our first ever 500Mb month in May.  There's already 92Mb on order for that month and we are sure to pump April over 400Mb by next Tuesday.  June offers nowhere to hide as there's already 102Mb there – it's kind of like trying to find space in your cabinets for one of those jumbo-sized boxes of cereal and you have to keep moving everything around

25460

Joe Rotger posted an excellent article on the contango game in Seeking Alpha today and I encourage you to read that as well as the links he has to get a real handle on the game that is being played here.  Notice in this chart, how far away the reality of the current contract price is getting from the forward expectations – you can see the very literal pile-up of contracts in March and April and the early March compression wave that looks just like a car trying to slam on the breaks to avoid the accident ahead!

I'll be doing a review of ZMan's potential oil puts after the market opens as this review has taken longer than I thought but I promise to have us tee'd up and ready to go by 10:30 as it promises to be a wild day, both for the energy market and the broader markets!

We have to keep an eye on gold at $670 and the dollar at 85 as Bernanke begins two days of testimony but, if he doesn't drop a bombshell today, I don't think we'll get one tomorrow.

Let's be careful out there!

 


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  1. Sakiko

    Accept my humble apology. If we were face to face I hope I’d have noticed you were just kidding! Hope I can remember your superior knowledge of econ when my obviously more rudimentary grasp needs bolstering. Thanks for your forbearance.!
    N


  2. I know the MET chart looks lovely, but its far off its 50 day, would you consider any puts for next month?


  3. GRMN
    Phil, I am long 15 of the GRMN APR 55′s and sold the same on the FEB’s. What is your take on how to play this today? GRMN is at about 59 premarket. Close all at the open, or wait it out?
    Thanks,
    JB


  4. NTRI – trying to gap up, could see it backtesting this morning to around $41.5, and then possibly a little short squeeze this afternoon before earnings come out after the bell.


  5. GRMN
    More: Amtech has this view:
    At mgmt EPS guidance of $2.70, this implies a ceiling of $54 per share. Assuming consensus moves to $3.00, this implies a ceiling at $60. Despite relatively high short interest, the firm expects the stock will retreat from pre-market levels.
    That view calls for selling the long calls at the open and buying back the short ones at a lower point.
    JB


  6. RIG beat earnings this morning by .06.

    j


  7. nltd,

    Hey, not a plea for apology back there at all ! I’m trying to have fun while learning and making some money (and losing less), just like you ! I will put a smiley next time I think these Market people are nuts.

    ;-)


  8. FXI
    Is pulling back, premarket
    JB


  9. TIE
    Up big in pre-market
    Keep any eye on ATI as well


  10. KO up a little PreMarket, is it enough to get us some value to sell against our leap?
    N


  11. Garmin stock gained $5.65, or 10.7 percent, to $58.36 in premarket electronic trading. Shares ended Tuesday at $52.71 on the Nasdaq.


  12. Nice little pop on FDX! Think it will hold up?


  13. GRMN – man I have got to learn to stick with my guns! Just like you should “Always sell into the initial excitement” you should never buy out your callers in the same situation. Especially with the April contracts time is your friend and you can always roll your guy to March and pick up an additional premium.

    I was not on the ball yesterday as I should have had a stop on that caller too but, for whatever reason, I missed it and now I’m stuck with him… Either way it’s going to be a nice recovery from being down over 50% on that position!

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

    RIG – that’s probably not enough.

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

    Don’t expect me to put a smiley every time I make an obnoxious comment – then there would be an obnoxious amount of smilies! 8-)

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

    FXI is waiting for me to take out my $105 caller.

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

    KO – I’m letting them reflect on earnings but we need to decide by mid day so remind me please.


  14. any thoughts on kbh puts today


  15. Watching the charts just waiting for AAPL to breakout


  16. GRMN- I did not want to take any risk. Sold my March55C at $4.30. Bought them at 1.30 on 2/12. I Learned from Phil. Don’t be too greedy and sell at peak of excitement. I expect volatility to go down.


  17. holy crap.. my first 3 digit gain ever (grmn).. way to go phil.


  18. looks like we are in a holding pattern until Big Ben and the Oil Pit. .


  19. Patrick

    Nice 2-day trade!

    N


  20. Bought GOOG lottery ticket…Feb $470 for 80 cents…go GOOG!

    j


  21. Phil and everyone here, Happy Valentines Day!!!

    j


  22. wow, headfake on the testimony?


  23. Fxi bouncing hard


  24. KO off about .20-.30 at present. If they don’t have a major epiphany by noon, looks like sale is probably off.. . I couldn’t find anything attractive yesterday when they were up. Reckon this may take more patience and some special Phil wizardry.

    N


  25. And a hard bounce for KBH


  26. LLY on drugs
    CAKE’s rising


  27. juliet,

    Happy Valentine’s Day to you – and welcome back (!)


  28. Juliet

    Happy V back, and to all as well. Knew you liked playing the casino stocks. Now with this GOOG play I bet you go in those places, too! Hah

    N


  29. patrick, yes, i think i read phil once warn against greed beyond the 230% gain point :)


  30. BTU cranking up nicely.

    ZMans oil picks I am lining up for puts – following the Valero rule. Oil must not break $58.50 and we want to see a net draw of less than 500Kb. You can buy these now if you are covered with a call (the XOM Apr $80s still make a good cover, as do COP Mar $70s for .70.

    I don’t want these all, I want the ones that run up and get cheap.

    BP Mar $60 puts for .40

    BHI Mar $67.50 puts I just took a DD at .90

    EOG Mar $65 puts for $1.50

    HES May $50 puts for $1.60 (possible March sale ahead)

    SLB Mar $65 puts for $2.25, selling $65 puts for $1 – can be done now and take .50 profit off the table quickly on March callls if offered.

    VLO $55 puts for .20 – a very dangerous mo play but I like it!

    TSO May $80 puts for $2.75, selling the $80 puts for $1 or more as I would be happy to pay more to be in the money on this one.

    MUR Mar $50 puts for .90

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

    I’m not too keen on these after Bernanke’s opening statement which was, as expected, very bullish for stocks and will lift energy stocks so any puts may be a bad idea!


  31. EQIX
    Flying!!

    GS
    Finally getting it going!!

    ICE
    155 coming!

    RIMM
    Nice action!!

    Nasdaq
    2480+!!


  32. In energy land, nothing matters before the inventory number today. RIG likely to move hard in either direction depending on the data. Stocks are currently attempting a “crude less” rally as they follow XOM higher as it follows the Dow on Bernake’s comments. I’m tempted to putter them on this but the prospect of a “massive, unexepcted” heating oil drawdown tells me I might get a better, higher entry later this morning so to back off and get a cup of joe.


  33. Up 37% in 7 minutes Juliet – :-) Bid – $1.10


  34. Ammar

    NICE JAB! yes over 230 may be greedy

    N


  35. Okay, just for the hell of it, I’m calling a key reversal day on AMD! lol, yeah, yeah, go ahead and laugh at me. . : ) : )


  36. SBUX finally moving our way a little. KO approaching -.50

    N


  37. Hear ya not keen puts. One thing I would stress is that if we do get a massive draw on heating oil (6mm+) then nat gas pops through the roof on anticipation of tomorrows numbers. Then you’ve got a chance to grab quick calls on CHK, KWK, SWN, EOG, and even NFX which has been on the brink a bit, and name I rarely talk about, PETD, would simply explode to new highs.

    PTSG now $1.49. People are starting to see that the original acreage play in the Barnett they have with Exxon is likely to expand by several fold.


  38. MRO March $90 puts for $1.90

    DD on SU Mar $70 puts at .80

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

    Good going on Garmin for all the faithful (man did that commercial suck though!)

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

    Happy Valentine’s Juliet!

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

    KO may be a dump – I’m wondering if they are just taking up space at this price…

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

    FXI – So much for my $105 caller – bought him out for $1 but I stand ready to sell again if there’s trouble (like oil going back over $60).

    Uncle Ben says:

    “Overall prospects are good. Business sector remains in EXCELLENT financial condition.” Excellent? Greenspan didn’t even say great in 20 years on the chair. I’m not even sure I remember a good that wasn’t preceded by “fairly” or “reasonably” this is a huge endoresement!

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

    230% in two days is at least a half off I think… GRMN testing the 10% rule at $58.

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

    Even Apple is turning up!

    MSFT coming on strong

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

    5 miins to inventory!


  39. GRMN
    Phil, on GRMN, I get what you said about not buying out the caller in the initial excitement, (I have not yet, but I did sell the APR longand got a house call out of it), but I don’t understand the comment about having a stop on the caller. What are the guidlines on a stop on a sold call? Is it partly intuition, reading a chart, (FXI is now above 105.9 resistence), and/ or pecentage--10%-20%, etc.?

    GRMN is now coming down and I am going to buy back at 56.8, the January top. Thanks,
    JB


  40. Not Enough To Support Crude!

    Crude: down 0.6
    Gasoline: up 2.6
    Distillate: down 3 mm vs 4-5


  41. Crude down 600K, Distillates down 3M, gas down 2M, utilization down a poitn to 86.6% – kind of bearish because of the low utilization (1% is 1.4Mb).

    Taking my puts but being ready with tight stops!


  42. Ohhh my GOOG calls getting sweet!

    j


  43. Intuition and the 20% rule – combination.

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

    Not buying the oils as we didn’t break $58.50 and, tempting though it is – I’m going to wait


  44. Hello all. Taking SU and BP puts. I liked the inventories in a lukewarm kinda way.


  45. Oops, I’m in on the oil puts now because I saw a huge discrepancy between the XLE $59s at .30 and the $59 puts at .55 – that means the big boys are betting this down!

    I’m going to take a chance and keep my finger on the XLE calls to cover if we break over $59.10


  46. 1/2 out of LLY Apr C 1.35. Food for drugs Investigation in Europe.


  47. my Valero page almost all green yet(not by much) …denial? one more last hurrah? A bit mystifying, albeit not out of the ordinary for this group.

    N


  48. Crap – draw in gasoline of 2 mm bls. The CNBC weather girl said the number wrong but the headline across the bottom was right. That changes things a bit. Those guys need to get someone who can read!


  49. Phil et al,

    I’ve been working on a project that identifies short term bull flag breakouts to hopefully bring some technical analysis to the site (remember always diversify ;) ). Still honing the fine points but so far it’s been doing well! Just have to work out timing.

    Happy snow “work” from home day too to the NE people!


  50. Bernanke is giving my speech – I’m going to have to start charging him!


  51. Phil,

    GRMN – I’m having a hard time getting my hands around the GRMN play and trying to understand why we haven’t almost immediately rolled our Feb caller to Mar at a higher strike because right now that rocket is getting tight back there…

    I bought the Mar 55′s @ 1.32 and sold the Feb 55′s @ 0.62 (the penny prices are because the trade was executed as a spread in TOS). Right now the Mar 55′s are @ 3.80 and the Feb 55′s are @ 2.975 and my Feb caller is way in the money with only a few days left. So I’m sitting on around 12% gain right now.

    If I roll my caller to the Mar 60′s, I increase my downside risk because my break even point moves up to a share price of 57. But if I don’t roll him and the implied volatility of the Feb’s doesn’t come down (why isn’t it coming down?) then it could get tricky.

    What are your thoughts?


  52. Don’t buy AMD or SBUX. It’s perfect short stocks that will only go lower. Remember the strategy Buy high and sell higher. Short low and buy lower!


  53. Man those XLE put people were right!


  54. Sold Mar 55Calls against Remaining LLY Apr 55Calls


  55. Phil
    am thinking of unloading some of my LLY april 55 calls
    normally when I do have that feeling stock spikes up
    your thoughts
    seems it just passed the 200 dma??


  56. Holy cow!!!!! look at GOOG go


  57. GOOG
    Juliet, Wow! you doubled in less than an hour! I think you have a talent for pick up cheap calls. This and SHLD! Next time I’ll try to have the courage to follow! =)


  58. GRMN – I’m in worse shape than you as my basis is $1.55 so I’m still at a 5% loss on the trade.

    I’m hoping for a pullback to $55 by Friday so I can buy out my caller at a nice profit as any downward move now will hurt your caller A LOT more than it will hurt you.

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

    “Fed will act if needed to contain inflation!” – Zing!

    Even DELL is liking this speech…


  59. Agreed, Juliet, that was the “trade of the day” ..


  60. Way to go, Juliet!


  61. LLY – when in doubt, sell half!

    SU just broke resistance.

    Oil falling fast as those NYMEX rolls are looking kind of dicey.

    Now comes the tricky part where all the congresspeople get to grandstand and we realize how many of them are clueless.


  62. SU in the red…love it!


  63. Congrats Juliet.


  64. Phil,

    Thanks, that’s the thinking I needed to understand--whether to hold and watch it come in and kill the caller, or to roll to Mar. I’ll be patient and stick with it. Thanks!


  65. BP is still holding on to her purse strings. Once they let go, we’ll have a nice slide. Can’t wait to see the spout of nonsense called damage control fly over the air.


  66. CNBCW still showing Bernanke, they didnt switch to BUSH thank you


  67. Great article on OIL/Iran/Saudi’s influence and the “Bomb”
    http://energy.seekingalpha.com/article/26847


  68. X
    might be looking to take out the 52-wk high!

    GS
    On fire! Taking some profit! Daily chart is looking very good.

    SHLD
    Looking better! Time to wake up!


  69. Thank you happyTrading, I love lottery when it works out.

    j


  70. Nice WFR Move, +$2


  71. Hey hey…Uncle Ben just dropped Phil’s trademarked canary in the coalmine reference!


  72. John, Re NTRI for the last year they had real easy comps to beat, now they have to beat last years great earnings… Their basic problem is that people don’t re-sign up for their meals which are pretty cafeteria type… If you have noticed they are intensifying TV ad’s etc, its got to hurt the bottom line. I am shorting it into earnings.. Let me know if you have a different take.


  73. GOOG
    Juliet, you’re welcome, and, you just tripled!! =)


  74. Ok, so now the market has refocused on heating oil and away from the weirdish, blending components based draw in gasoline.

    OXY up way too much here vs the group.


  75. No, you are probably right. .Just liked the day trade . I was thinking $41.50 as low today, but was 40 cents off..oh well.


  76. X
    new high!! going fast! Buyout coming!! =)


  77. Boy, I wouldn’t be surprised if we try to touch 2500 touch on Nasdaq..


  78. Bernanke, is he doing this on purpose? An ordinary layman can finally understand what the Fed has to say and where they stand.

    Phil as you are the captain of this ship, can you give us an update as to the status of our orbit.


  79. Sell Mar or April 55′s against WFR Leap??


  80. do you think goog will be down tomorow after bidu earnings tonght


  81. FSLR

    Up +21% today!

    Is the solar train leaving the station?


  82. Schumer making a good point, but again his political mind is skewing his question.


  83. Nasdaq
    2490!! Approaching liftoff velocity! 3rd time’s a charm?!


  84. A bold idea comes from U.S. technology and media pundit Mark Cuban, who says the majors should together commit to creating a rival to Apple’s iTunes, the leading music-management software and online music store. Cuban reckons the industry faces a stark choice. Create an iTunes competitor selling their entire music catalogs, free of DRM software that prevents music-sharing, and embrace a low but flexible pricing for the online store as well as a Google-style ad-driven revenue model. Or hand victory to Apple CEO Steve Jobs – and the pirates.


  85. Congrats J!

    Oops, now Bush has to step in to save oil by reminding us there’s a war on. He says the violence in Iraq is “disturbing.”

    Now is saying our goal is to “secure that capital” I guess we’ve given up on the rest…

    Much like our goals for the SOX, if we keep scaling back enough we’re eventually going to hit our targets!


  86. AAPL meeting resistance from the 9th 85.60


  87. GLW
    Continuing upwards; breaking above 22.1 again!

    JOYG
    Finally seeing some good action.

    RIMM
    It’s happening!! 140 soon!

    EQIX
    Intraday charts topped out. Taking profits!

    MGM
    Cutting losses on the puts!

    X
    Intraday pullback; buying march calls!


  88. XLE & BP in the red, lets see if this clears the way to the high 57′s.


  89. Sold WFR Mar 55 against WFR Leap


  90. Time for LVS Calls?


  91. BIDU earnings tonight, any thoughts anyone? Thanks.

    j


  92. I stand corrected on the double red….now where are my Rolaids.


  93. Juliet i think we should be asking you that question! So what do you think. LOL


  94. not selling my LLY april calls!!
    3 month ago when stock was at 54 they were worth 2.5 now 1.4


  95. kustomz, I was looking for lottery for BIDU but can’t decide the direction it will take. My first instinct is to buy Feb $130 for 80 cents since this baby can run up or down 10 – 20 points.

    j


  96. In/Out of X Feb 90C @ .45/.65 (+44%) , but still haven’t capitulated on those X Feb 85P yet, now @ -66%

    Might follow happyTrading on those Mar 90Cs, but it may be time to get that rosary out for a quick kiss.


  97. Oh sorry can get it for 75 cents.

    j


  98. Phil:

    See our AXP calls? Wish we’d DD when it was .6?


  99. BIDU
    Kustomz, I was going to say the same thing! Juliet, do BIDU’s calls look cheap to you?! =) If you get it, I’m in!


  100. BIDU
    Btw, charts just bottoming out! Although upper BB is below 130, and the BBs were opening up downward for the past couple of weeks. It would be a tremendous reverse of the present trend, if it goes above 130 tomorrow!


  101. happyTrading lots of people are very bearish about BiDU, but again they might be right but if i can get it even cheaper than 70 cents I might consider.

    j


  102. Market
    Going into its lunch sleepy mode.


  103. GOOG
    up on pretty high volume. good sign.


  104. kustomz and Juliet…my thoughts BIDU….keep in mind i am a novice on options…..i own BIDU stock and sold 120 calls ages ago and more recently 125 calls. I can tell you they DO NOT drop fast (relatively and timing considered). I think the drops were to clean out the Callers and it did not work…..expensive but i think the safe bet are the 125′s. They will make money as I think BIDU will go up from here…that is from watching the stock price daily. Good luck


  105. do you think bidu p/e is to high and in order for it to go up after earnings it has to be a blowout quarter look at goog quarter it was great and it went down


  106. If you think the stock will swing 10-20 points why not buy both puts and calls. The gain on the one will more than offset the loss on the other.


  107. Karl, thanks for the comment, I think $125 have a better chance of making money if it goes up but not sure I want to risk $1.70 for a lottery.

    j


  108. BIDU 125 calls selling at $1.50 and stock just went up about 0.60


  109. Looks like a little short squeeze happening right now with AMD. . already 15 million shares in 2 1/2 hours. Most likely this thing will be pinned to $15 for Friday.


  110. BIDU
    Did you guys see the estimates! If they hit/beat estimates, it would be a 250% year-to-year increase!! Quarter-to-quarter would be about the same. I think they’ll do pretty well. Not sure if they’ll go above 130 in one jump. Might have plenty of time tomorrow morning; or, buy March calls now?? But, then again, it would not be trading “Juliet-style”!! =) (Don’t worry, Juliet, we know you have plenty of leaps also!!)

    Valentine’s Day
    Will be taking off early today (in about an hour). Spending the day at the spa with girlfriend! Please give the market lots of LOVE!! Happy Valentine’s Day!!


  111. Oh Karl, you’re right, it is $1.50, I must have been looking at the puts price. Uhmm, can’t decide which one to get $125 or the $130.

    j


  112. More good news on the housing front!

    Masco posts loss, says 2007 outlook difficult

    By Laura Mandaro, MarketWatch
    Last Update: 11:56 AM ET Feb 14, 2007

    SAN FRANCISCO (MarketWatch) — Cabinet and fixtures maker Masco Corp. turned in a fourth-quarter loss on Wednesday, as a drop in new home construction and remodeling projects kept buyers away.
    Additionally, the Taylor, Mich., company said “the uncertainty that home builders may cut production even further” to reduce the inventory of homes on the market, “combined with the unpredictability of commodity costs,” would make it very difficult to provide earnings estimates for the year.


  113. Quick question – As I haven’t been watching YHOO that much recently can anyone give me an idea why it’s been up so much recently to the point where it’s trading at a VERY LARGE premium P/E wise to Google …. Is it just Panama buzz or a mooted takeover perhaps..?

    Jack.


  114. John,

    So are you still in NTRI ? I thought you were out.


  115. got out last week. . just was going to play the little morning reversal but order didn’t get filled. Anybody buying those March 90 Calls still? Happy Trading, are you in? I lost on the X Puts, maybe I should go the other way. .


  116. BIDU
    Yesterday, briefing said: Baidu.com weakness attributed to cautious broker comments (112.95 -3.86)
    I looked all over and found no attribution.
    I am long the MAR 120.
    JB


  117. P – where’re you at? Oil’s diving for the deck and the stocks are actually starting to respond! RIG’s getting hit and even BHI is falling.


  118. He must be busy clicking his buy button.

    Careful on overcommitting on BIDU. Remember GOOG and their earnings?


  119. Z, did you take a put on OXY? Didn’t get my bid triggered yet.


  120. Phils having lunch with his cable company representative.


  121. Setting a .10 TS on my SU’s.


  122. GRMN

    Just closed the GRMN Feb/Mar 55 spread for +65% one day profit. Maybe jumped the gun, but it’s in the pocket. Thanks, Phil!

    ss


  123. LOL Kustomz. He is probably flossing that guys teeth (or other parts) with that cable.


  124. Boy, CRM above 50 bucks. .to think I wanted to buy some Puts on this bad boy last week. . . .Like Phil’s comment, a rocket up my. . .


  125. BIDU

    Interesting article at Schaeffersresearch.com/commentary. Bottom line is that the disparity between options implied, both calls and puts, indicates an explosive move, but cannot say the direction.


  126. Okay, I think I want the Feb $125.

    j


  127. BIDU warrents caution, certainly. Safest is a put-call spread. FEB 110 puts are 2.85
    Out of GRMN caller @1.5, sold APR for 5.1.
    JB


  128. Correction on that GRMN trade, it was two days. Almost long-term for some of you guys…….. : )


  129. jack_of_hearts,

    YHOO – Relief Rally… Marketwatch: … were up 1.3% to $29.95 following news that two more senior executives have left its Yahoo Media Group.


  130. I’m out half my GRMN trade too at about 25% gain. I’ll leave the rest to a bit more chance :-)


  131. OK, I’m back – had to do a big Valentine’s day thing with the girls!

    OXY is interesting action… I think they are pinning the $47.50s, Mar $45 puts at .50 looking attractive.

    Bernanke not expecting energy prices to rise quickly again – that’s good but it’s a big hedge to what he’s saying.

    I wish he would just say “I don’t know” sometimes when they ask him questions on some things (like where will housing inventory be at the end of the year). I swear some of these congressmen are asking him for investment advice!

    Orbital Status – when you break orbit you know it – it will be like a cable snaps and the market just flies up to a new level but this is right about that point. We must hold our levels and we must add to this gain by Friday, possibly with a triple diigit finish to the week – that would be breaking orbit…

    Bernanke – “mportant to keep foreign markets open” Ding, ding ding! He has now hit all my talking points!

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

    WFR – I already sold March $55s, still the best way to go.

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

    LVS can’t get it going in this market! Sad…

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

    Gassy plays holding up ahead of tomorrow’s report, might save to oil stocks from a full tumble too.

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

    LLY might be pinned for Friday

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

    $55.25 is breakdown for VLO, if they don’t hit that soon we may get a sector bounce. $55.60 is upside danger, maybe 20 minutes to resolve. Of course look for group confirmation (note much more useful chart on the bottom left of this page – thanks Jared!)

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

    AXP – just be happy we’re coming back. I only DD if it’s a bet, right at that moment, that I would make if I didn’t have the original – AXP was just a little too worrying on the chart.

    And never forget why we DD – we DD to take half off as soon as we reach our lowered basis so we can let the original amount ride even.

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

    BIDU needs a big Google move to set it free, if GOOG zooms back to $500, BIDU will be a great proxy play.

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

    Oooh the Spa! Have fun getting pampered Happy!


  132. Pitch ” He is probably flossing that guys teeth (or other parts) with that cable” LOL i think Phils to sophisticated to take physical action, i think hes probably giving that guy some bad stock advice, like buying the 125 bidu’s lol J/K Juliet! Actually might be a nice play.

    Hey John you were right on with AMD, hope this move was advantageous to you.

    I can make a living trading AAPL, Jobs being cleared would boost this stock 10


  133. silentstudent, C’mon, now – I’ve been in a few two week trades ! Not to mention withering in HB-land for a month (one trade).


  134. go FDX! on a tear right now.


  135. Kustomz,

    AMD – it’s kinda looking that way, volume high, just depends how it closes.. My guess is it will settle around 15 bucks at close, probably hit resistance today around $15.25


  136. Phil,

    Will a caller call me if he is in the money but not profitable? I have the AAPL Jul 85′s @ 8.57 and sold the AAPL Feb 85′s @ 1.32. AAPL’s share price is 85.15, so he’s in the money. But he’s not profitable from an options perspective because the share price needs to get to 86.32 for that.

    Should I roll him because he’ll call me away?

    -Corey


  137. GRMN
    Here is a link from the Barron’s Trader, that great site that someone pointed out the other day. We should have had this and its previous, yesterday for guidance.

    http://blogs.barrons.com/techtraderdaily/2007/02/14/garmin-huge-q4-2007-guidance-way-above-the-street-stock-soars-shorts-were-right-to-be-nervous/

    JB


  138. YHOO and GOOG both undervalued. How can you possibly mount a challenge to either one of them? AOL is dead, MSN would need a personality transplant to catch on – no other true rivals, even internationally….

    If Google is to ever be seriously challenged, someone must buy or partner with Yahoo, otherwise you are year’s behind from the start.

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

    VLO kicking up to danger zone but no reason for it that I see, hopefully it will fail here ($55.60)

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

    My cable guys have mainly resolved my problem thanks (and I now have the supervisors cell #!). I must say that Comcast cables service has been excellent throughout. It was an intermittant problem and they did everything I would have done (I was Director of Network Sales for Entree way back when) for an important client and everyone I spoke to was great (not good, actually great).


  139. Still in NTRI here after 2 dd’s…..another analyst came out with a 92 target which seems high but I’ll take 72 at this point. Moving nicely today….added some Jun 40′s for 6 earlier….fingers X’d



  140. $0.50 advance on XOM in 10 minutes anticipating a coming pump in oil. It’s 3 mintues after 1 EST and no giant jump like the past few days. Very close to taking the Mar 75 Ps for $1.20.

    No, I talked about OXY, got distracted by a shiny bobble in my office and forgot to place the trade. Thinking about it now but will wait for the oil pump if then.


  141. HB’s take any non disastrous statement from the Chair Man and spin into a positive….they’re rolling the wrong way again :shock:


  142. QCOM
    up on big volume today. Both Feb and March 40 calls look attractive.


  143. Real nice V-day present market flying
    CIEN- SOLD second half on the March 30 calls UP 220%.
    I love Miami airport even if this time it is a 2 hour layover.
    Any good plays we are looking at today? Could only skim the comments.


  144. Just a quick note to say that I’ve returned from two weeks in the wilderness of no Internet access to speak of. Now I get to wade through a few thousand news articles to catch up with reality.

    I can’t say that I’m pleased with what you’ve all done to the markets in my absence; I’d have preferred a nice steady gain. ;-)

    I can’t promise that I’ll wade through the last two weeks of Phil’s Stock World’s comments, so feel free to ask any questions I might have missed. Although for the next few days, my answers might be “I don’t know yet”. ;-)

    reinharden


  145. Callers – it’s not their choice. If you are in the money by .05 you are automaticlally assigned the stock at the close of Friday’s trading. If you sold a caller you must take him out or you will be forced to deliver X # of shares to him by next Wednesday.

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

    AIR on a tear!

    BAB too 8-(

    That was it for Bernanke – nothing bad there!


  146. RIMM
    Took some profits.

    BIDU
    So, what’s the consensus on BIDU. Have u already bought Juliet?


  147. reinharden, Nice to see you back!


  148. I’ve also been watching the OXY Mar 45′s (+OXYOI) with some interest. Will take a closer look at 2:00, if we get a failed pump it could get nasty! Out of my SU’s and dnagerously close to being flagged as a day trader by Ameritrade :)


  149. Good to have you back Rein. I’m at Dr office with kid. nice to have access, but missing all normal tools. Feel severely handicapped! Make some for me too!

    N


  150. Rein bad boy, 2 weeks in a state penitentiary. Whatd you do?

    Good to have you back.


  151. GS/RIMM
    BillBigD!! Nice to year from you!! Look at GS!!! I took profits, though. Well, look for re-entry tomorrow!
    RIMM took 1/2 off the table. You’re here I’m almost going. Girlfriend taking her time getting ready. We’re going to the spa for V-day!

    EQIX
    Took profits this morning. Waiting for re-entry. This one is strong and should go higher.


  152. Bernstein is the same report I cited the other day.

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

    OXY – you didn’t miss much yet..

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

    HB move is minor. Bernanke says vigilant – chance of a rate decrease will settle below 15% and dollar will rise, putting pressure on housing prices again.

    Watch gold, if it breaks below $670 it’s a problem for housing and oil!

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

    Maimi airport has a pretty good sushi bar near the hotel that’s inside the terminal.

    OXY puts are a good play right now. Check intraday, some of those oil plays are stilll a buy but we have to watch out for the possible 2 pm pump, despite all logic to the contrary.

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

    Welcome back Rein! Hope you are nicely reenergized for our next big rally attempt.


  153. Rein
    AAPL March 90 calls -deal or no deal?


  154. Zman
    did you get in on XOM march 75 at 1.2?


  155. Just walked in the door. Missed all the action. Phil, how did you DD on SU mar 70 puts? Thought you
    stopped out yesterday at $1.40.


  156. FXI from Briefing:

    FXI reached an all-time high of 118.04 in early Jan. Since then, the stock has been consolidating its parabolic advance, and that consolidation has taken shape in the form of a symmetrical triangle. While this formation is evident on a daily chart, it can more easily be identified on an hourly chart. Currently, the stock is probing the upper range of the triangle. Given the magnitude of the congestion, an explosive move is possible in either direction, and while no break has taken place yet, we thought that this setup was worthy of your attention here. Note that a break below 104.44 would put pressure on the lower range of the triangle. Initial resistance to the upside lies above at ~107.50.

    JB


  157. BIDU – how about buying Mar 120 Calls and 110 Puts and selling the Feb 115 Calls and Puts.

    Per OXPS for 2 spreads each,

    Cost/Proceeds ($70)
    Option Requirements $2,000 (no idea whyy OXPS thinks you can lose money both sides)
    Total Requirements $1,930
    Estimated Commission $51.80

    Stock Price Profit/Loss
    $100.00 ($347)
    $103.50 $0
    $105.00 $148
    $110.00 $872
    $115.00 $1,863
    $120.00 $1,020
    $125.00 $427
    $129.99 $0
    $130.00 ($1)


  158. Kustomz – It was worse than the state pen, it was visiting family in the Ozark mountains of Arkansas.

    Met a new grand-nephew, so that was nice. But said grand-nephew’s father arrived in Kuwait this past Monday, so that’s not so nice.

    Shortly after I got there, both my parents, one of my sisters (also visiting), and my niece (also visiting) all came down with the flu. Toss in ice/snow storm in the Ozarks with subsequent absence of electrical power and a frozen water system and life becomes more of an adventure. One especially must love the jaunt down to the creek to fetch 5 gallon pails of water when one is the only not-sick person in a house without otherwise running water!

    Fortunately, the monotony was relieved by an Anatolian Shepherd puppy (which at six months weighs 80 pounds) that was afraid of everything that moved in the dark and vigorously alerted us by barking until someone awoke. Combine that with need to feed a woodstove every two hours because of the aforementioned absence of power. So sleep was brief and interrupted. Days were spent creating firewood, fetching water, and clearing downed trees.

    So I’m happy to be back in civilization. ;-)

    reinharden


  159. happyTrading, yes I bought BIDU Feb $125 for $1.30…wish me luck!

    j


  160. OPTNX Unusual Options Activity

    Select options seeing interest, making upward implied volatility moves on volume today, with little corresponding action in the underlying stock, include: Calls: OXY calls are seeing heavy buying following a XOM-for-OXY rumor this morning. Specifically, the OXY Feb 47.5 calls (volume: 5700, open int: 5990, implied vol: ~30%, prev day implied vol: 25%), the OXY Mar 50 calls (volume: 11.1K, open int: 5110, implied vol: ~31%, prev day implied vol: 25%) and the OXY Mar 55 calls (volume: 5190, open int: 90, implied vol: ~37%, prev day implied vol: 25%);


  161. Meryll Lynch reports 9.5% in LEA
    Phil any play there?


  162. Happy Trading
    GS- didn’t buy in on the dip as I had the July 210′s But bought BSC APR 160′s when stock was at 157ish just sold as BSC is 165.
    TIE- missed it in the high 35 range.
    RIMM- I know I should sell but praying for 139
    Have fun at the SPA
    Phil- You are right that Sushi bar is pretty good but I wait for the Sushi in LIMA next week it is awesome


  163. Luck Juliet.

    Rein, ain’t it grand? The country life sans modern tech, ah. . .

    N


  164. Phil – Thanks for the additional info regarding callers and their being assigned stock and my having to fork it over. AAPL is currently at 85.33 and the options are Feb 85′s, what is the likelyhood AAPL will be pushed below that strike prior to or at expiration? The calls are still priced at 0.85. Since I’m up about 34% on them, should I just take out my caller and be done with it; looking to sell Mars or Aprs?

    -Corey


  165. Arnie – without having waded through everything, my first impulse is to push most AAPL purchases into April so that we capture the next earnings announcement in the options period.

    But I’ve not yet looked at the options prices.

    I was under the impression that AAPL had allegedly purchased a Super Bowl ad, but I didn’t see it if they did. I had hoped that AAPL would have brought the Beatles onto iTunes by today (what with the current show being called “Love” and all), but that doesn’t seem to have happened (although the Beatles should so up real soon now). I expect some hardware revisions to the Mac mini, iMac, and Mac Pro any Tuesday now; however, I’m not sure when they’ll be. March should see some news with regards to the release of MacOS X 10.5; however, I’m not sure that that news will be before options expiration. Similarly, March should see a new MacBook Pro based on Intel’s Santa Rosa chipset (see http://en.wikipedia.org/wiki/Centrino#Santa_Rosa_platform_.282007.29 ) which might also miss March options expiration.

    So I see several possible catalysts between now and April expiration. But I’m not sure if we’ll catch them with March options.

    But, if there are some cheap options for March and the market is moving up, I’d be onboard with AAPL ’cause I think in the mid-80′s it’s awfully cheap. Since you’re looking, do you have any specific trades in mind?

    reinharden


  166. reinharden

    your vacation was spent much the same way people lived everyday 150 years ag…..welcome back to the future


  167. rein
    I’m in on March 90 at 1.35 base and stopped myself to add more at 1.05 this morning


  168. I’m on Yahoo here, so delayed, but can’t help noticing the big spread between USO and a group of oil/gas stocks put up quickly (+XLE). They’re sure holding up well. . .they seem to be tracking somewhat, however, albeit in a higher parallel universe. (working around even, with USO down 2-2.5%)

    Comments?

    N


  169. SHLD must be pinned to $185…go baby!

    j


  170. HB LEAPS anyone?

    Now looking at Jan-09 puts …

    Low-risk, minimal capital way to play the continuing housing bust.
    Tax benefits also. Premiums look cheap because of continued HB strength.

    Don’t see the anticipated spring selling season recovery happening.
    (Martians with bags-of-money stay home, afraid of Phil’s rocket launch!)

    Any thoughts?


  171. Ravi,

    BIDU- Did you look at what would happen in case of a drop in IV? This position would lose money no matter what if IV drops 10%, which could happen after earnings.


  172. Arnie – Care to talk me out of/into those same AAPL options. I’ve been disconnected for two weeks, I’m probably pretty pliable. ;-)

    reinharden


  173. BIDU – I changed the IV to 36 from 52 and it didn’t seem to matter. Let me know if you see different numbers.


  174. All my oil stocks just turned green (last transaction) ?? Here comes VLO from -.27 scrambling to get back to even


  175. 2:00 pump in efffect. OXYs probably have a shot at .40…


  176. FSLR – First Solar

    Wow – look at it go! Up nearly +30% today.

    March 30′s up 9.00 to 12.70 …

    I guess we should have had that 10-bagger discussion :(


  177. Bought IBM mar 100s at $1.35. Looks cheap to me.


  178. BillBigD,

    Is that Lima sushi place Matsuhita by any chance ? Nobu for us Norte Americanos


  179. EXPE – hello phil – do you suggest any insurance to naked July $22.50s
    Do you suggest any other EXPE play before tomorrow’s earnings . Thanks !


  180. VLO back to even


  181. optrader,

    BIDU – when I changed IV to 40, this is what OXPS gives –

    Price P/L
    100 (590)
    105 (212)
    110 420
    115 1348
    120 553
    125 30
    130 (309)


  182. NDX trade: Mar $1,800s are now $42.30 (was $28.90) and Feb $17.75s are $38.30 (was $19.70) so no point in selling them, just kill the trade and take the profit on the March if you have it – too much money to risk!


  183. BIDU- Are you looking at 02/15 or 02/17?


  184. Low volume in AAPL, i was hoping for a break above 85.60….86 would have been a possibility

    Prof weekend is a great time to reflect on the weeks misses dont let it get you down(DAMN DAMN DAMN), i would like to have that 10 bagger session. Before we miss another one. :)


  185. Out of VLO $55 puts at .30


  186. BIDU- Are you anticipating the stock to pretty much stay unchanged?


  187. I have some Jan 08 GE 35 calls naked at 2.86. Any suggestions in light of your call selling advice “sell early, sell often?”


  188. AAPL – Well, I just went ahead and bought out my caller @ 0.90 on those Feb 85′s. It was stressing me out a bit and up over 30%, so I’m fine with that. Applied the gain to the basis of my Jul 85′s (I like that).


  189. BIDU – I was looking at 2/16. and looking for BIDU to not gain/fall more than 10% before expiry.


  190. kustomz,

    DAMN is right! My solar watch list is up across the board today!

    TSL +11%
    ENER +6%
    ESLR +7%

    These companies appear to be under heavy accumulation.

    Glad somebody is listening, anyhow …


  191. BIDU -
    On 02/16, at $100, I am showing a loss of $2,200. Max gain of $3,000 at $115. Turns out being a profit of $8,000 on 02/17 at expiration at $115.
    This is if IV does not change
    If IV drops 10%, $100 is -$3,300 and max profit at $115 is $1,000.


  192. Sakiko, (off topic)
    The place did start with M and is in San Isidro, Lima, Peru. I should know the name as I have been a few times. Do you know Lima? If the same place I didn’t know they had one in Lima. It is funny as NOBU in Miami and London are quite good but the one in Dallas is not good at IMO. Regardless Sushi and seafood in general are great in Lima.


  193. Boy, these BID prices certainly lag the ASK and stock price increases


  194. REminds me of gas prices at the pump, except just the opposite direction!


  195. BIDU
    Why *wouldn’t* IV fall, is it not absolutely certain to, the unknown being by how much?


  196. BillBigD,

    Sushi (how can sushi be off-topic for V-day ?)
    The famous one in San Isidro is Matsuei. My friend had a consulting gig down that way last year, and we hung out for a few weeks. I was officially a consultant as well; you know, “Technical Advisor”. I’m sure you like the cute gals there. Concur on the food.

    and now, back to stocks…

    GLW has awakened !


  197. Juliet—--BIDU looking positive for your FEB 125 calls; stock bounced off of $115.45 four times and now moved to $115.96…….120 calls up 0.45 and now 0.50; 125 calls up 0.06 and should move up soon.
    Good luck


  198. Cramer pumping FSLR, AFTER it jumped $10. BUYBUYBUY! What a guy.

    I’m tightening up my stops. I think profits will be taken by Friday.


  199. See Jon?

    Once again, PSW is ahead of MSM :)


  200. LMAO Sakiko”!” “!”


  201. SBUX – They are up today. I have the Jan ’08 37.50′s @ 3.10, so I’m in the house of pain there although it was only 1/3 of the position I really wanted. Right now I see the Jan ’08 32.50′s @ 4.60 and the Mar 32.50′s that can be sold against @ 1.35 (about 30% of the Jan ’08 premium) and am thinking this is a good time to go ahead add to my position and move down a few brackets at the same time. The Mar 32.50′s would offer some good downside protection and I would still have room to add the final 1/3 of my position if SBUX goes down again.


  202. RNWK – hello phil – do you suggest any earning play for RNWK. Thanks !


  203. GE – I’d sell part of anything that’s up big today. if we don’t get a pullback – great, more to buy later, if we do get a pullback, thank goodness we did!

    I’m lightening up on many of my big gainers (25-35% off on gains over 30%) as that was just 2 REALLY good days!

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

    Oil pump was far less than impressive, no danger at $58.50 so I’m good with my March puts although no great gains so far.

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

    EXPE – half off at $1.95 – no way I ride that gain into earnings!

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

    AAPL – I think they pin $85 into expiration but Monday may be fun if the market stays positive into Friday.

    I moved most of my AAPLE to July $85s and $90s as I want to be able to sell against if we continue to have trouble. Not enough wiggle room in April.

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

    HBs, I’d wait to see how they digest today’s news, so far they seem happy.

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

    Corey, it’s not about likelihood, you don’t take chances on that. Make a plan that you will take them out by Friday afternoon.

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

    LEA – I don’t like it.


  204. SBUX (cont.) – I suppose the risk of this is that SBUX is actually done going down and the sold Mars would stay in the money. A second option is to simply get out of the Jan ’08 37.50′s and just sit tight for the real bottom. Then there’s the Phil option, which is to leave it there as a reminder of how poorly the entry point was chosen.


  205. for IWM watchers……once again for FEB 07 the BIG PUT SELLER (S) (over 100,000 contracts) got out with huge profits. The open interest on his sales at 77,76,75,74 are below 10,000 and selling for 1 to 3 cents…..he sold them in late Jamuary from 0.90 to 3.25…….he does this every month. I will check the Marchs and report when and at what price he sells puts


  206. Welcome back Rein, but are you sure it was not your absence that caused the markets to act like this?


  207. SBUX – at -25% I have no desire to add to it but I do think it’s too cheap to sell against (as selling against would mean I buy more and cap my gains and I just don’t find it that attractive at this spot).

    I find I do a much better job of watching the things I commit to so the light entry system works for me to keep me focused for a better entry.


  208. Phil,
    Great minds think a like! LOL Just sold RIMM Mar 135, JCP Mar 85, and INFY Jul 60 all for roughly all for 33% gains.


  209. Joined juliet on the BIDU Feb 125C Valentine lottery @ $1.05


  210. I find I do a much better job of watching the things I commit to so the light entry system works for me to keep me focused for a better entry.

    I do the same, took a small position in AMGN just to keep it on my radar. Keeps me on top of my position instead of just forgetting about it and missing a move.


  211. LEND

    Somehow up +2.4% today, even after a bad miss

    Looks like damage was already done by NEW’s earlier news
    (NEW up +7% today)


  212. CNBC just said “heavy short covering” behind today’s rise in sub-prime lender space


  213. BA selling Mar $90s for .55 (as I am going to sell march regardless there is no downside here as my worst case is a roll).

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

    ANF done with Feb $72.50s at $9.90

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

    BAB offering .60 for DD on Mar $105 puts


  214. Phil:

    New to your site; trying to learn your strategy; and find it far more educational than any other site or even “coaching” I’ve paid for.

    So… re. “I have some Jan 08 GE 35 calls naked at 2.86. Any suggestions in light of your call selling advice “sell early, sell often?”

    When you say “sell part of all that’s up big today” do you mean sell the LEAP or sell some short-term calls against it? In other words are GE calls worth holding in a LT portfolio to sell premium against?


  215. Phil, are we not doing the “XXX” for trades actually made anymore or posting a separate section for the portfolio moves like we used to? I am a little confused, maybe I missed something.


  216. CSX up 7% today. Other rails up. FDX up too.

    Havent heard much about the transports lately.


  217. Well this was a lazy day for me. Oil puts didn’t gain like I hoped, but they’re for March so I have time. Now I’m off to prepare dinner for the family and shove more Chocolate covered cherries in my face with Cognac filled chocolate chasers.

    I’m going 10-7. Good luck on the BIDU lottery you guys/gals.


  218. Phil,

    Quickly, why your bearish take on BAB?

    TIA


  219. Have fun DDAY

    BA march 90s for .55?


  220. Juliet
    BIDU – I bought the Feb 130C at .70 at 1PM. We will see how it goes and we can compare results. Good luck.


  221. LLY half out at $1.50 as it was a DD, happy to make the nickel!

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

    MC back from the dead!

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

    DD on TDW Mar $50 puts at .70

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

    VIX going back to 10!


  222. dday97,

    Will be leaving as well, we’re off to Lawry’s down in LA despite what I did to myself on those X Puts. ‘Nite, everyone. I’ll check BIDU AH from the Volvo.


  223. Good luck to everyone on BIDU earnings!

    j


  224. Housing, Oil, BAB…prove that common sense may be extinct…with such small open interest on the BAB 105 puts, I think we own ‘em all!!


  225. Whoever bought those GOOG 470′s this morning for 80 cents; great job !

    BHI; I have been long BHI into earnings. I began lightening up over 72 today; will hold some into earnings; possibly expiration. May get out AH or tomorrow am as well.

    Also, just bought BHI Mar 67.50 puts at 75 cents (thanks Phil for the idea); and also sold Feb 67.50 puts for 10 cents believe it or not.

    Biggest mistake of the week … had a TON of SPY 144 calls the other day; sold ‘em yesterday. Had I held thru today, would have made a fortune, instead of a nice little trade.

    Oh well; live and learn.

    Also sold SNDK Mar 45 calls for 40 cents; reducing further my basis in the Jan ’08 40′s to about 7.50.


  226. i, too, joined the Juliet lottery on BIDU at a buck.

    f we make a few bucks here, gonna buy something nice for the missus. if not, then, oh well. Long live NUAN leaps…


  227. Mrn – sorry, that I really should have clarified. I mean March Aprils (Febs are all off the table already) as a huge gain like this can be retraced overnight. So “shorter” positions I like to pull in a little profits when they are offered as I generally don’t like to have big open posiitions in my short-term portfolio.

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

    XXX – since I’ve started posting the Intraday moves, I’ve sort of gotten out of that habit but I will try to remember when I take a new position.

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

    BAB is overpriced up here and vulnerable to an oil spike so it’s a hedge for me againt oil going the wrong way. Amazingly, no one seems to care that the ground staff just rejected their contract proposal by 68%

    “the deal, which BA says is necessary to plug the 2.1 billion pound ($4.09 billion) deficit in its pension plan. Two weeks ago, BA barely avoided a 48-hour walkout by staff over the pensions, incurring 80 million pounds ($157.3 million) in lost revenues because the company had already announced flight cancelations by the time the deal with the union was struck.”


  228. What’s the play on BIDU?

    Maybe I’ll join the party …


  229. NIHD-Missed that one yesterday
    RIO- fully gone on this one!
    Everyone have a good V-day, off to CALI


  230. NCTY buying some Mar 40s into earnings later tonight. Might have already gone up too much but I think they will beat estimates. PE is only 27.


  231. I lack the conviction to buy BIDU options at the moment. I’ve no idea whether their next move is -$10 or +$10. And the risk/reward of covering both just doesn’t seem worth it. It’d cost $12 to put/call the Mar $115′s which means I’d have to come to the shorter Febs. And that’s still $9.

    Assuming that I got a $10 move, I’m only making 10%.

    I personally like targeting 100% returns. Which I can’t do without some degree of conviction on the direction of the move.

    If I were assured of a $10 move, $110 puts + $120 calls would only cost $5. But I’d need that $10 move just to break even.

    So having talked myself out of playing, watch BIDU move $15 tomorrow.

    reinharden


  232. GOOG – that’s why you have to have those plays tee’d up during expiration week, I’ve always got my Google brackets on the monitor in case it starts to move!

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

    You’re all mad gamblers on BIDU though! Good luck…


  233. Of course, having said that, i gave up and bought a play position worth of BDQBD (Feb $120).

    reinharden


  234. The real thing that bothers me about Baidu is that I’m not convinced they don’t just make up whatever numbers they want. I don’t trust the transparency of anything coming out of China.

    So my rationale for going ahead and purchasing is that there’s no reason for them to make up bad numbers this particular quarter…

    We’ll see…

    reinharden


  235. Welcome to the mad gambler camp reinharden. The key operative is “play position” here. We have the craps players lined up by the table and only 4 hours of wait until the conf. call. Go BIDU.

    Meanwhile S&P is falling so I am having a GOOG nightmare flashbacks here but oh well…


  236. BAB

    Snagged a few Mar-105 puts for 0.65.
    Good risk/reward profile, stock has significant downside.
    Phil is usually right when he’s extremely bearish (e.g. LVS recently)

    BIDU

    Staying out of this craps roll! Impossible to predict direction here.


  237. Ha prof it was you with the 3 .65 BABs
    I was behind with 8 at .6
    phil did not get any…


  238. NTRI WOW
    Net income increased 213% to $19,607,000, or $0.53 per diluted share, in the fourth quarter 2006 compared to net income of $6,271,000, or $0.17 per diluted share, in the fourth quarter of 2005.


  239. Great day everyone. Interesting action on MO March calls today, particular the 85′s and 90′s – 26k on 130k OI and 10k on 130k respectively. Seems high compared to their neighbors, and seems generous in light of the stock only going up .5%…


  240. Once I finish looking through the last two weeks of results, I think I’m going to position some Jun/Jul options around the concept of Dow 13,500, SPY 154′sh, QQQQ $47′sh…

    I’ve not seen anything that showed the S&P 500 terribly disappointing on earnings, the economy seems to be improving, housing seems near a bottom, inflation seems in check, energy is more likely to go down than up from here, and the next two years promise nothing but campaigning about how to end the war in Iraq which means the eventual freeing up of a trillion dollars/5 years or so of “defense” spending.

    All of which might help trigger the market melt-up I’ve been looking for since July. Of course, some might argue that we’ve already seen something of a melt-up.

    So, who has the counter story?

    reinharden


  241. Phil:

    Can you look

    GS Jan 220′s sell March 210′s
    what is the worst case scenario on 10 of these in your view? thanks


  242. prof
    I also snaged a few KBH march 50 puts for .65
    had to join the club


  243. Hmm, I’ll have to rethink my offering statements if you bastards are going to jump in and underbid me!

    LOL – no biggie really, I etiher get something or I don’t is my philosophy…


  244. Phil
    Was away for several hours and could see you were pretty busy. Checked port moves but didn’t see anything vis-a-vis:

    KO may be a dump – I’m wondering if they are just taking up space at this price…

    Phew, what a day!
    N


  245. Sorry, Phil, did I do something wrong?

    I didn’t underbid you for BAB’s – actually paid more (0.65) than you were willing to (0.60).

    Three big up days seems unlikely, so wanted to get these before EOD today …


  246. NTRI – holy cow! People were sure on the wrong side of that one! There’s that old Superbowl commercial rule in action….

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

    GS – the worst cas scenario is always that you lose all your money. Some way, some how, it can happen!

    I wouldn’t sell in the money calls against on this in an up market (or even calls against for that matter). They have a p/e of 11 vs 13 for JPM, 12.35 for MER, 11.67 for MS (avg for industry is 15) but their PEG ratio is far better than all but MS (and they’re 10% better than MS).

    They are MUCH smaller than JPM but growning at more than twice the pace. You may think they are big but they probably have less than a 10% market share in the sector which is growing as fast as web services. As long as we are growing the global economy, these guys will grow faster. All in all, this makes them a bad stock to sell calls against, especially into earnings.

    On the other hand, new regulations on funds, asset management or the collapse of a hedge fund can knock 20% off this sector before you get out of bed…


  247. Oh noooo, BIDU disaster du jour!

    j


  248. Happy VEE day hope you all have someone to love that loves you back!!

    SUSHI time!!

    You Know You are a Permabear When…
    http://bigpicture.typepad.com/comments/2006/03/you_know_you_ar_2.html

    Damn i missed that NTRI trade, looked at it a few days ago and took AMGN instead.


  249. NTRI… Sept 06 Net income was $23.4 M June 06 was $19.7M Co’s can fluff up comparisons. It is a sequential decline in earnings


  250. in AH NTRI is up $8-10 If it can hold these gains thru the open the play might be some puts.


  251. Juliet, BIDU is looking good?? Results were pretty good. I didn’t do any, but I bet you make $$$


  252. BIDU – Got to love it, they only beat earnings expectations by 50% so they’re down in after hours. Wait…Up. Erm, no…down. Well, all over the place.

    Probably, as a general rule, companies with ~100M in revenue really don’t deserve 4B in market cap. Generally speaking.

    Could be up $10 tomorrow or down $10 tomorrow. Who knows…

    reinharden


  253. Jamie, BIDU beat earnings but the guidance was not so good, so it’s very shaky yet unless it keeps going up afterhours and tomorrow. I’ll still keep faith that it will get above $125….crossing fingers and legs and everything I can cross.

    j


  254. AAPL – One thing in favor of buying Feb/Mar AAPL instead of Apr AAPL. If you’re into history repeating itself.

    AAPL last announced a stock split on Friday, Feb 11, 2005.

    One would think that they’d not make such an announcement the morning of options expiration…but who knows.

    Of course, the previous split was announced on Friday, April 21, 2000. Which, by the by, was options expiration day!

    Before that was April, 1987. I didn’t immediately find the date although it was declared Wednesday, April 22. But there seems to be a 2 day discrepancy between the declared date and the announced date with the two later ones and I’m not sure there wasn’t back in 1987 as well.

    So, were Apple to announce a split, historically, they’ve done so on Friday. And in February or April. Doesn’t mean they won’t do something different next time…

    reinharden


  255. I hate BIDU, but just couldn’t stand by,,bought stock at close of Day and sold for plus $3 AH.
    Now I can head to the casino and see if the $69 dollars can turn into a round of “free”drinks.


  256. We all have to get together in vegas and I’ll teach you all my craps system – you don’t make any money but you can keep $200-$300 on the table all weekend, come out even and get everything comped!


  257. I’m IN for Vegas. Can we go during WSOP?

    Signing off … time to enjoy V’s day.


  258. Tell me your craps system and I will see how mine differs.


  259. Can you share your best craps system ; anyone

    I’m going on a crise this weekend and the tables are callin’
    thx


  260. I’m in for Vegas as well.


  261. I just knew all you options guys were gamblers at heart – just like me! But why is it I can lose $1000 at the tables and think nothing of it, but if I lose $1000 in options I sulk for days?

    But today, ah today, Garmin was very, very good to me. Nice to play something really right for a change. Now if it will just go down nicely so I can reenter.


  262. Does anyone actually here trade for a living? I’m thinking eventually I could make more money trading versus having a real job. . .


  263. Craps – It’s more of a money management system than a betting system. I maximize my amount in play by playing 5,6,8 when the number is 5,6 or 8 plus the field. Field wins press the numbers and number wins come off the table. The rest is just basic position sizing and you can play for hours and never go up or down more than 20% (and if you’re smart you take 20% and leave) but you can play with a lot of bets.

    I usually play $10-$25 line + $5 C/E, then – if 4,9, 10 – I just play the number but if 5,6 or 8 get hit I cover the other two with $30-$75 each and put $10-$25 in the field. In determining amounts I double down and pull back when ahead, much like my stock postions.

    Once I have my (example) point of 5 and 6 & 8 are covered I have as much as $250 on the table and I press the 6 & 8 up $12 each on a field win and take off any 6 & 8 victories. Since I win on any non-7 roll and 5 out of 6 rolls are not 7 and 14 out of 36 rolls are 5, 6 and 8 I have a positive likelihood of 2 $75 and 3 $25 payoffs before a 7 is rolled.

    Ideally if you have enough for at least 10 rounds (20 is better), you should be able to play through most losing streaks as long as you realize that you are not playing to win, you are playing to be a rated player and get comped so you try to play for an hour or two, get even and walk away (usually I then go play poker).

    This is not an easy sytstem to work with as you have to move chips around almost every play and you will confuse the hell out of low level dealers who get very annoyed if you don’t tip them as you are constantly adjusting your piles but it’s lots of fun because you get paid on every single roll until a 7 comes up.

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

    Trading for a living – I don’t think I’d want to have my entire income depend on it but I know lots of people who do. I went through the big crash and that has made me permanently gun-shy of couting on anything as dicey as the markets for a primary source of income although the way I play now I would probably do great in a collapse… I guess I have to go through one again to find out!


  264. How do we, who are newer, determine which long-term positions would be good to put on at this time? Do you enter a position knowing it will be for the LT portfolio; or do you just graduate your better short-term plays? I learn a lot by following your day-trade & blogs, but want to i.d. positions that keep most of my money in LEAPS (or at least 5-6 mo. out) and selling premium against it.


  265. Good plan MrN! I just went over the LTP on the weekend and there were a couple of viable new entries.

    Any time I take a leap, I am looking to make it a LTP, otherwise I wouldn’t be paying the premium as you get little reward from actual movement up (and, more to the point, little penalty for movement down). Only when I cover it has it truly graduated.

    If a long contract is in my Short-term portfolio, it is in purgatory, usually a small bet and waiting to build a postiition, once I move it to the LTP I usually feel it is past danger and it is rare they get booted at that point although KO is looking that way at the moment.


  266. Phil:

    Where do I find those “viable entries” listed on your site? I thought I read the blog all week/weekend. Are they i.d. in LT port. somehow?

    in re. to “Good plan MrN! I just went over the LTP on the weekend and there were a couple of viable new entries.”

    Where is this discussed?