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Friday Virtual Portfolio Moves

Posted July 27, 2007 at 9:40 am | Permalink (Edit)

CROX – I don’t think yuou guys get the fact that we only spent .05 on this play so we have a ton of options. If we had the margin for it the proper move would be to take a couple of Septs off the table into the initial excitement (the naked play is gone already) then wait for the same thing that happened ot AMZN and BIDU to happen to our boy but, in the case of the $10KP the best move is to roll the Sept $52.50s to 2X $57.50s and roll the caller from the Aug $50s at $8 to the 2X the $55s at $4.35 XXX

Posted July 27, 2007 at 9:46 am | Permalink (Edit)

IMB – missed your chance to get out even already! Maybe a flush on the way down… 8-(

In general – remember what I said yesterday about trading curbs leaving a lot of sell orders backed up at the brokerages. If we don’t get off to a good start then those orders will be reupped today so we let the DIA and Q calls die and don’t take the puts off the table until we break positive. Until we get back to 13,600 nothing we see will be more than a minor bounce.

CVX is going down on those earnings so what does that tell you?

This time I’m not going to miss shorting Google against 1/2 my longs, probably the $510s, possibly the $500s as a mo play down. XXX

Posted July 27, 2007 at 9:53 am | Permalink (Edit)

Emergency White House “Economic Summit” will attempt to spin the GDP and the economy this morning so watch those puts in case we have to dump them.

Posted July 27, 2007 at 10:00 am | Permalink (Edit)

Rolling logic – only the assumed margin restriction of a $10KP. If CROX takes off, that will be our next roll, rolling the caller up to 2x the $60 calls, which right now are $2.55 of pure premium and already outgaining the $55s.

VLO – great call Z! They are already turning off the downgrade. I grabbed the Aug $70s at $3.90 as it’s always good to have upside protection anyway. XXX  (ACTUALLY IT WAS SEPTEMBER!  SORRY***)

Posted July 27, 2007 at 10:05 am | Permalink (Edit)

The pending summit is holding up the markets but I’m very, very glad to have worked into what is effectively a Dow strangle. If we start to take off I will DD on my QQQQ $49s, now .86

Totally ignore the BS price of oil, watch SU to see if crude is going up. They couldn’t possibly be in a better postion with record high oil and very low nat gas (they use it to power their process). If they can’t do well now the whole sector is doomed. CVX too, how can they not be positive?

SLB doing well. HAL also doing well so I will grab the $35s there at $2.15 as it’s a low premium mo play xxx

Posted July 27, 2007 at 10:06 am | Permalink (Edit)

XOM – those Sept $95s are just .95 XXX

I know – oil calls – can you believe it?!?

Posted July 27, 2007 at 10:07 am | Permalink (Edit)

1/2 out of puts, will DD on whichever layer we stop at that’s nearest the money. XXX

Posted July 27, 2007 at 10:10 am | Permalink (Edit)

XOM current $90s are fairly priced at $1 too! XXX (this assumes you have puts).

Posted July 27, 2007 at 10:32 am | Permalink (Edit)

QQQQ calls and 1/2 out of DIA puts! I had a progression of DIA puts I laid out earlier and now I’ve taken half of that off the table (the other half will now come off at another .25) and I will DD (or rebuy in full as the case may be) when upside momentum slows in the strike that is closest to the money at $2 in August and $3 in September to cover what I hope are gains to the plus side. At that time I put tight stops or half out of the calls.

This stuff is not easy and it doesn’t always work but at this point in the month (4 weeks to expiration) I don’t mind having a strangle on the indices. I heard nothing exciting from these guys so if that’s what the markets were looking for, we didn’t get it but my conspiracty theory de jour is that the PPT already gave the brokers $50Bn to toss into the markets today regardless of what they said to end the weekend with somthing like a recovery.

I’m still very skeptical and will be rebuying DIA $135s, even though they are $2.35 rather than the $134s if we turn red here. As I said earlier – I just don’t know and cash is by far the best way to go today as no fundamentals have changed (there goes SHLD again!) so this is all a matter of perception.

I’m watching XOM breaking below $87 as a significant issue if that happens but I really have to go with my gut here as I put myself in the seat of a shameless market manipulator and this would be my game plan. Why bother having that very unique summit if you’re not going to follow it up with a rallly. It would be a disaster to close the market down after the whole economic cabinet and the President try to reassure us…

Posted July 27, 2007 at 10:38 am | Permalink (Edit)

AAPL calls – don’t sell too many. I was just thinking how glad I was that I’m mostly naked…

GS $200s are currently $5.40, which is a crazy amount but they might make a nice mo play if GS crosses $96.

Posted July 27, 2007 at 10:43 am | Permalink (Edit)

I’m kind of drifting into just trying to stay even on puts and calls now, buying more calls on the way down and more puts on the way up so a 200 point move in either direction within a week will be a jackpot but this is very tough to call so I’m aiming for 80% cash going into the weekend. XXX

Posted July 27, 2007 at 10:53 am | Permalink (Edit)

HB calls – sure because they are as likely to go up as down for no good reason (probably a BS merger between 2 regional biggies that will give them a whole year to fudge the books).

Ouch – real vote of no confidence for our economic team – all those pent up orders coming in fast.
Stopped out of oil calls, heading to more cash. If the market rallies now I will miss it as I’m going way more bearish including DIA $134 puts, now $2.38 XXX Stopping out of all to cash!!!

Posted July 27, 2007 at 11:05 am | Permalink (Edit)

PTR did not get the drop I would have hoped for so I’ll be watching the FXI for signs to get out of there.

SUN getting beaten down.

C at a 52-week low!

Don’t forget how much BA and IBM are boosting the Dow since thier $100 price gives them significant leverage. MMM is another $90 Dow component having a big day which makes me very surprised they are letting XOM go as it’s usually an easy one to stir up.

Posted July 27, 2007 at 11:20 am | Permalink (Edit)

BP, TOT, RDS.a all looking bad so Europeans are getting out of oil. Since they have all the money it’s going to be pretty darn hard for US investors to keep these things up by themselves. HES finally heading deep south. The market still can’t fight an energy sector sell-off and the brokers still have too much money in commodities so let’s keep an eye on HES, SU, SUN, and PTR (Buffett just cut back!).

I’m pre-rolling PTR to the $145puts at $3 in case the Buffett news catches on but it’s a small reduction and he’s way ahead so this is more about me taking a double off the table on the $150 puts. XXX

Posted July 27, 2007 at 11:46 am | Permalink (Edit)
GSK – lot’s of options for the $10KP including rolling the caller to the Sept $52.50s for an additional $1.50 in premium which would put us .50 in the money with no downside risk (we are currently down $1 against our caller). I’d rather wait to see if we get a bounce around $50 but that’s my exit strategy. At .40 I will buy out 4 shares as I have no need to be greedy and it will be a great move if the stock recovers. XXX
Posted July 27, 2007 at 11:56 am | Permalink (Edit)

CAT grinding down – how can you not think it’s over?

XTO, NOV, VLO, CVX, FCX, EOG, HOC, HOV racing BZH to hell, PKX is no alternative to oil pain, OI, RDC, C!!!, FNM, JOYG dying with the miners, XOM (calls all gone), X, NE, DO!, SLB!, GS! – looks like I’m going to get my 13,000

DIA $133 puts are chasing at $2.38 but good if you haven’t got a downside hedge and good if you are rolling mattress plays. XXX

Posted July 27, 2007 at 12:03 pm | Permalink (Edit)

DIA – no I’m out of the call business, like I said earlier – if that “Summit” of the PPT couldn’t get the markets going then we have a real crisis of confidence and while they keep saying 65% of the S&P is beating expectations, the expectations were for a terrible quarter so BIG FRIGGIN’ DEAL!

VIX taking off again and I will remind you to either take uncovered leaps off the table (LTP too) or cover them because once that V goes away you will suddenly find your contracts are worth about 10% less than you thought. When in doubt sell half absolutely applies here but I don’t have too many doubts about wanting to be well protected in this mess. Let my leaps by surprised by a sudden rebound forcing me to roll up my calllers and take a small hit for one of my remaining 18 months – that should be the problem I have on Monday! XXX

Posted July 27, 2007 at 12:15 pm | Permalink (Edit)

Mattress plays – hmm, that’s a portioning issue, don’t forget I’m 70%-80% cash when I’m doing these so it’s all about the percentage of your virtual portfolio, amount of cash etc. If Sage can tackle all that it would be brilliant but my brain hurts just contemplating all the variables that need to be discussed.

PTR selling off a bit. If BA turns down we could be good for another 100 points down pretty fast. IBM holding out too, very stubborn stocks we love in the LTP!

MRVL refuses to go down so I’m going to initiate Jan ‘09 $25s, now $1.35 as a buy and forget for a while play. XXX

Earnings highlights for next week:

Mon: ADM (good for a strangle), CCJ (wow will this be fun!), HUM ($60 puts are just .75), MNST (should be good), RSH (should have thought of shorting them when they were at $35!), TSN, WWY, / (night) FRK, SUNW, TIE (I’m adding on this dip) and VMC.

Tues: AL (funny if they blow it), ADP (good jobs indicator), AVP (Int’l sales), BEAV, CBS (will affect DIS), COH (how are the rich doing?), GM (ROFL – why do they call it “earnings”?), LCAV (I like the Sept $50s for $1.25), LIZ, MRO (potential disaster, $52.50 puts are $1.55), NMX (should be huge, $135s are $2.80), OSTK (should be funny CC), SIRI (I’m naked), JOE (can it be worse than expected?), UA, VLO!, VNO (possible buy if they get down to $100) / (night) BWLD, CEPH, CMG (Sept $75 puts are $3.45), DWA (has been spectacularaly disappointing in the past, Sept $30 puts are $1.15), FSLR (they’d better do well), LFG (how bad is it really?), LEAP, MET, RUTH (probably the first to go if upper level dining is suffering), SWN, TUP, OVEN ($12.50 calls at .65), WFMI (LOL).

Weds: AT ($65 puts for .98), MT (Sept $60 puts for $3.55), CI, XEC, CTSH (Sept $85 calls $4.40/Sept $75 puts $2.35), DWSN, DVN ($75 puts at $2.62), FCL, GRMN (I’m going to take the Sept $85s, now $4.95 and work into a spead with the Aug $80s, hopefully for less than $3), JNY, KFT, MA ($145 puts are $5.35 for a craps roll, also OCT $160s at $11.90 selling the Aug $160s for $7.25), MCO ($55s for $2.62), NBL ($60 puts at $1.43), OSK, OC, PEG, Q, THQI, TWX ($20s for .43 – they have got to be kidding!! ‘Mon back), TEVA, RIG, UMC, VZ ($42.50 put and calls at $2.20), ABX ($32.50s for .97 – beep beeeep), EDS, GXP, GW, LF (are people still buying expensive toys?), OII, PRU, SBUX (Sept $27.50s for $1.15), SUN, UPL, DIS (if CBS is good then I’m back in with $35s)

Posted July 27, 2007 at 1:40 pm | Permalink (Edit)

MRVL – I always come around eventually! I may even buy WFMI one day if you keep asking all the way down to $20!

SPY/ANY LEAPS – I was going to say not when the VIX is at 20+ but SPY is down $10 in two weeks and the March $148s are down $6 to $9.80, that’s not a bad ratio to play. You can sell the $150s for $1.90 and roll them every dollar so it’s an XXX as a low-risk way to play as you can roll yourself down at .50 per dollar too! Actually that disparity makes it a REALLY good play.

TM – 8/3 earnings and you now want to make a huge bet against them? No thanks! I’d roll down to the $125s for $1.30 (+ $1 = $3 basis) then DD (basis $1.65) and Sell 1/2 the position in $120s, now $3.40 but I think I’d first sell 1/4 and hope to do better on the next 1/4. That will put you in the trade for 0 so no downside risk and a lot of outs if the stock does well including rolling back to the Sept $130s, now $1.45 on a spike and rolling your caller up to 2X whatever works. XXX as a new play!

Posted July 27, 2007 at 1:50 pm | Permalink (Edit)

AAPL – for a reentry (and I’m there too) I’d rather sell whatevers on a run up and then take the longer Oct of Jan calls to capture the Aug premium. That way I don’t have to guess a good spot, that will be my caller’s problem. I really want to see a clean break over $150 where I can sell the $155s for $4+ and buy the (perhaps)

Posted July 27, 2007 at 1:59 pm | Permalink (Edit)

XOM once again proving the sometimes value of doubling down relentlessly!

AXP Oct $60s for $3.30 (was $5 Tuesday) and Oct $62.50s for $2.20 (were $3.25) are good plays.

Posted July 27, 2007 at 2:14 pm | Permalink (Edit)

I’m very surprised to see JNJ at $60 but it’s not my job to save them.

BOOM booming! ATI may be coming off the mats here.

XOM can’t break $88 – how the mighty have fallen.

Posted July 27, 2007 at 2:17 pm | Permalink (Edit)

GOOG sneaking up on us! $520s for $8.30 as a mo play, stop at $7 ($1.50 trail). XXX

Posted July 27, 2007 at 2:35 pm | Permalink (Edit)

Thurs: BKC (MCD got slammed and $25 puts have just .20 premium at $1.73 – can cover with 2x $25 calls at .22), CHTR, CDE, ED, CVS, ED, EK (fun to play $25 puts at .70 and $27.50s at .60), EXPE, FAF, GMCR (are they really better than SBUX? No options though), IP (I would think wood is getting cheap), KTO, KBR, MGM (no one is buying them so Sept $65 puts at $2.33 are a good gamble), NYX (got leaps), PTEN, PDE, RDC, HOT (missed them!), TRMP, VIA, GSF (during the day!), BID (during the day) / (night) AH (short BAESY.PK if they miss), BOL, BUCY, LNG (Sept $35 puts at $1.80), GES, LVS (also fun), NEM, NT, TRLG

Friday: BW, EOG, PG, WY, THI

Posted July 27, 2007 at 2:39 pm | Permalink (Edit)

CCJ – still in the Jan $42.50s and Sept $50s against which I sold the Aug $45s. $42.50s are where I’m adding naked.

Posted July 27, 2007 at 2:52 pm | Permalink (Edit)

GOOG .75 stop on half so $10 right now. XXX I have to leave soon so I can’t baby sit it and, even if I could, it’s still good policy.

 


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