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Thursday Virtual Portfolio Moves

Posted August 23, 2007 at 10:03 am | Permalink (Edit)

CVX and SU $85 puts are XXX up here.

DD on my DIA $132 puts and adding back $130 puts at $1.75 as pre-roll. Just a little nervous looking at the internals..

Posted August 23, 2007 at 10:11 am | Permalink (Edit)

This is an energy sector rally – not a good way to recover. Whenever GM leads the Dow higher I tend to want to go the other way…

Posted August 23, 2007 at 10:39 am | Permalink (Edit)

CCJ/UTX – both are plays I think are at bottoms so I am not anxious to cover down here. Of the two, UTX makes me more nervous but $72.50 has been rock solid support and I can always sell the $70s on the way down and pick up more than the $1.15 currently being offered for the $75s so that’s my current attitude. At about $2 I would get interested in selling the $75s.

Posted August 23, 2007 at 11:04 am | Permalink (Edit)

MCO getting crushed, kind of unfairly but there is a huge overhang as people (congresspeople that is) question their role in allowing this sub-prime mess to escalate by handing triple-A ratings to what turned out to be junk bonds. Still the Jan ‘09 $60s are just $9.20 and you can sell 1/2 the Sept $45s for $4.10 ($2.20 premium) and 1/2 the $50s ($1.50 and $3 out of the money) for a nice first month return as I really doubt they will recover soon. XXX

Bye bye oil patch – gas inventories weren’t very exciting and these guys have nothing to hang their hats on. If the NYMEX turns red, this could get nice and ugly. I’ve been waiting for an excuse to press my XOM ‘09 $75 puts, now $2.15 back up and this is it! XXX

Posted August 23, 2007 at 11:10 am | Permalink (Edit)

Stopped out of DIA calls, will reset them if we turn back up but not likely I think. Will take profits off the table on uncovered short-term calls but not many of them left anyway.

For fun I am shorting GS with the $175 puts, now $5.80 as a mo play with a stop at $5 ($1 trail) and also the FXI $133 puts, now $5, which were $19 on the 16th – kind of the reverse of the ones we came up on…

Posted August 23, 2007 at 11:17 am | Permalink (Edit)

LTP – selling against uncovereds:

SBUX $27.50s at .72
TXN $32.50s for $1.98 as a mo play
WFR $60s at $2
M $30s at $2.30
JNJ $60s at $2.30 as a mo play
COF $65s for $3.80

Posted August 23, 2007 at 11:22 am | Permalink (Edit)

LTP sells – more:

GE $37.50s at $2 against half
C $47.50s for $2.08
CAT $75s at $3
CHK $32.50s for $1.05

Side note – SCI is on a tear. I have the Jan $7.50s but the Jan $12.50s are very attractive at .90 and the ‘09 $10s for $2.95 are a great deal but it’s very thinly traded.

Posted August 23, 2007 at 12:24 pm | Permalink (Edit)

CHK – as long as we keep our eyes open, we can take off the caller at the first sign of a strong wind but there’s no sense in not picking up a few dimes if they’re going down from here. I said to Z last month when we were talking about record net short positions on nat gas that sometimes everyone is short on something because it IS going down…

Posted August 23, 2007 at 12:43 pm | Permalink (Edit)

MRVL flying!

Holding 13,200 is not too bad. Let’s keep perspective with the Nas over 2,525 and the S&P over 1,450 we would have been thrilled to be here last week! Europe had a crap finish, giving up a full point of gains from open to close – as I said in the morning, it’s totally up to us to keep this party going but I remember from when Greenspan said it, it’s very hard to recover from the word Recession and I think Greenspan’s comments took a day to hit the fan, then there were 2 days of talking it to death. Hard to imagine everyone going long into the weekend with that concern hanging over their heads.

I think the fear of a mortgage meltdown is somewhat overblown in that it is easy to avoid if the government steps in and commits $100Bn a year to restructure consumer debt but there will be so many idiots arguing how to admister it or if to do it that it will probably never get done. A crisis like this needs strong leadership and we sure don’t have that!

Posted August 23, 2007 at 12:46 pm | Permalink (Edit)

COST is falling victim to the Cramer + 2days rule. $60 puts for $1.15 are a good deal. XXX

Posted August 23, 2007 at 1:01 pm | Permalink (Edit)

Size – don’t feel bad, I was bullish yesterday and bearish today. I’m not flip flopping, I’m in cash and following the markets. I don’t recommend a commitment to either side at the moment. If I had to make a single, long-term play for the year’s end, I’d short the Dow but I’m very glad I don’t have to make that decision and I’d rather take the electrodes to the privates than commit to any direction over the next 2 weeks!

Volume price spikes – or it may be sharp traders selling into whatever excitement they can as they try to wriggle out of positions. I said the other day that we can expect to get in a channel between 13,000 (hopefully) and 13,250 so this is no surprise to me. The VIX doesn’t like this sell-off and is rearing it’s head back above 23.50 (no help to my 30 caller) but it’s less enthusiastic than one would expect on a 60-point drop. The worst sign we will get is when the VIX lays down while the market goes down as that will finally indicate that down is the path of least resistance.

Posted August 23, 2007 at 1:22 pm | Permalink (Edit)

COST – no one is selling them so far but it’s coming up a bit now so we might get lucky (or unlucky if it keeps climbing!). I just mentioned the other day that I’d rather let them go than pay an extra nickel and this is one of them.

Posted August 23, 2007 at 1:57 pm | Permalink (Edit)

SU recovering but still far off the morning spike. Oil not doing well into the close but someone buying SU thinks the fix is in. VLO group is confirming something is up so be careful if you are short oil (short-term that is).

ADM exploding today – lots of strange action going on in pockets.

Posted August 23, 2007 at 2:12 pm | Permalink (Edit)

Gross is saying just what I said, the Fed COULD do that but it won’t help. The only thing that can save the economy is direct government intervention which, as I said, requires strong leadership so we are doomed!

Meanwhile, nice comeback in the markets! BS though it may be if we hold levels through the weekend we may have something but they have to take 13,250!

Posted August 23, 2007 at 2:45 pm | Permalink (Edit)

MU – Down here, for sure. I’d also at least sell the Oct $12s for .47.

Somebody hit the trigger on a sell program – this is a sweeping sell-off. Should have stuck to my guns on GS!

Posted August 23, 2007 at 2:57 pm | Permalink (Edit)

Airlines very likely to give back half their gains if oil crooks can retake $70. CAL $30 puts are $1

Poor ZUMZ!

CCJ keeping the V alive with a 10% drop and a 5% recovery to end up about even.

Have to take WYNN $110 puts for $2.55 as a fun play,

Posted August 23, 2007 at 3:04 pm | Permalink (Edit)
TRMP returns from the dead! Oct $7.50s for .73 XXX
Posted August 23, 2007 at 3:24 pm | Permalink (Edit)

GOOG coming back – all is well!

Crazy markets…

Posted August 23, 2007 at 3:34 pm | Permalink (Edit)

CFC – I think the part where he refuses to say they can avoid bankruptcy made people a little nervous!

Whee – now we go down again!

Posted August 23, 2007 at 3:46 pm | Permalink (Edit)

TRMP – not really, just playing the rumor mill. He’s the DNDN of the casino biz but I do think there’s value to his properties although I wouldn’t want to assume his debt for $215M (the cap). The options only run out to April and the premium is pretty stiff but you can own the stock at $6.93 and sell the Oct $7.50s for .78, a nice return and you can stop out at $6.25 and take your lumps on the Octs if it starts to fall apart but I think it will hold.

 

 


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