Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!

Technical Difficulty Tuesday

Sorry about the site crisis – the server crashed and the term "backup server" seems loosely defined, something I will address later.

I lost my post – this is the remnants of it.  But at this point I’d rather move to comments.

Again, very sorry about the hassle this morning!

- Phil





They say that breaking up is hard to do.

Now I know, I know that it’s true.  Some say that this is the end.  Instead of breaking up the damn Dow keeps bouncing back off the 13,600 mark (how far did you really think they lyrics would take me?).  Have we moved into a rangebound trading zone and, if so, what are the parameters?

Obviously 14,000 has become painful resistance for the Dow but we’ve also made a nice floor (we hope) at 13,500.  On our Big Chart from yesterday, we can see that takes us neatly between the Dow "Breakout Level" and our "Next Goal" zone.  It’s almost being too kind to say the S&P is holding 1,500 and we are a LONG way from a retest of 1,550 so we’ll settle for just getting back to our "Comfort Zone" at 1,505.  Our best news comes from the Nasdaq, which seems to have formed a floor at 2,775, over our "Next Goal" level of 2,750 and right now, that’s what’s holding up the rest of the market so go Nasdaq!

Rangebound trading was my weekend prediction as we set up our FrankenGoogle play, which was designed to take advantage of Google’s wild gyrations.  That range will be put to the test today as the GPhone excitement peters out and Alibaba/Yahoo mount a very serious competitive threat from across the globe. 


BZH 68% cancellation, -53% new home orders.  $82 last year.  HOV


Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!

Comments (reverse order)

    You must be logged in to make a comment.
    You can sign up for a membership or log in

    Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

    Click here to see some testimonials from our members!

  1. YHOO – what to do?

  2. We in

  3. Holy cow was that stressful this morning. And such an exciting market day too.

    This is a dollar crash rally, not my favorite kind but let’s just switch off our brains and see if we can break our technicals (ironic how we had technical difficulties on the site today..)

  4. No worries phil, you work very hard anyway, needed a break.

    Morning traders. Lets rock and roll.

  5. How far do we ride gold stocks now? Wish I had back everything I’ve been selling on the way up.

  6. hey phil, what do you think of oil puts?? OIH maybe?? Even royal dutch thinks the price is overvalued….

    Or any home builder calls???

  7. I thought it was my computer!!

  8. Hey Phil-

    What do you recommend w/ regard to your FSLR spread and the DNDN play?

  9. Good to see you back Phil. Don’t kill any brain cells over it, these things happen.

  10. YHOO – CEO testifying before congress about something. Roll down, their stake of Alibaba is worth $50Bn if that price holds up. That will make YHOO the new CY, where the stock they own is worth more than their whole company.

    Oil going totally nuts, might make good shorts on a bad inventory but not today!

  11. I didn’t think SPWR was a Chinese company…WOW crazy pop this morning.

  12. sorry i meant home builder calls or puts…

  13. No, Phil just dripped cheese from the breakfast burrito onto the server.

    Boy, did YHOO take a drubbing this morning.

    But check out SPWR!

  14. I’m so glad I bailed out of YHOO the other day at 32. Being able to reload 2 points lower is wonderful.

  15. FSLR – I took out my caller on that last dip as he was totally annoying me. Very lucky. If you have the June/Nov spread and you can afford it, roll him up to the $165s for $11 as that’s $9 more in premium to capture, once it calms down, you can roll him to Dec whatevers.

    DNDN – we beat the caller, that was our goal, now we wait. There’s no point in giving the caller a nickel.

  16. i did not know how much i rely on this site until this morning! glad you’re back!

  17. Glad to see you back, kind of weird not having comments to back up thought process.

  18. Phil

    I believe it was the Feds that took your site down this morning. They didn’t like that picture of George pretending he could read with the kids. Guess you’ll need to be checking your office and home for wire tapping…after all you are a threat to national security.

  19. Buiders – I’m staying away. At these prices they are just maipulated tools.

    YHOO coming back – silly markets.

    Thanks Windy, good to be back. Try as I might, I just can’t get Tina to listen to me rant about the markets so I get really lonely with the site down! 8-)

  20. YHOO tanking…stock worth $50 bn? or $5bn?

  21. Phil,
    I got ISRG Jan 320 (cost 22) vs Nov 320 (cost 6.2).
    Should I roll Nov 320 to 330 or wait till next week for expiration?

  22. This is the worst rally I’ve ever seen: WFMI, SHLD, UPS, STX, LVS, SNDK, YHOO, AXP, EBAY, IBM, C (still)… lots of things going down that shouldn’t.

    Something that should be going down is BIDU and there she goes!

  23. Frankengoogle – Phil I can enter the whole iron condor for $18 credit now. The original play was for $17.1 credit. Still a good entry, or are there modifications now that GOOG is in the 735 range?

  24. That anonymous is from “fredrang”. Not sure why I came up that way. Anyway, this morning was the equivalent of having no Starbucks caffeine in my system, with nobody to talk to.

    Loving those Valero Puts I sold in both November and December. Also, you’ll be glad to know my 14 year old son made his first option trade…that’s the same age my dad taught me to invest. Hopefully you won’t charge me a double subscription fee for letting him read your blog over my shoulder.

  25. Are we moving to puts now?

  26. Feds – I said to Jared this morning “But I have to warn people not to fall for this rally!”

    ISRG – you could take him out as a mo play and see what happens but if they are rejected at $320 you’ll be very sorry. I would leave it.

  27. Phil – I’m looking at LULU for an entry this week, what do you think about the company?

  28. No fredrang, just tell us what he bought he maybe a good picker.

  29. testing user name

  30. Retail – before Thursday. Any thoughts on JWN

  31. Not sure what is going on…maybe the government is watching me now. Signed back on but I still have no identity. Any suggestions…if not I’ll email Jared. thanks

  32. GS is looking real weak to me this morning. Anyone else?

  33. TRMP moving a bit, they are a constant buy-out rumor. I’m going to take the Jan $7.50s for .70 for fun, see what happens.

  34. Why doesn’t BA want to break!? all this consolidation at these levels.. c’mon break break break! 106 BA, go to 106!…

  35. “I just can’t get Tina to listen to me rant about the markets so I get really lonely with the site down!”

    Phil, if we all had significant others who cared about the markets, we wouldn’t be here. :)

  36. That was film. :)

  37. Scalping GOOG and QQQQ today. $1000 at a time.

  38. DM – patience.. the longer it consolidates the higher it will go once it does. Do you have NOV’s?

  39. Larry Hagman over Al Gore EVERY DAY OF THE WEEK: not just talking the talk like Fat Al.

  40. I also felt completely alone this morning. Don’t let Jared do that to us again.

  41. Phil

    That’s funny…when I tried to explain options to my wife she accused me of trying to make her feel stupid so she explained how options work to my daughter with a shopping at the mall analogy.

  42. testing “anonymous” 1 more time

  43. Okay, my identity has been removed by the government.

  44. BA – No rolled to Feb Strike when the stock calmed down.

  45. YHOO stil looking for a safety net?

  46. Still, My portfolio is getting weighted, I would rather a little more cash.

  47. I actually came across a good analogy the other day:

    You are going on vacation for a month, so you decide to rent out your house. The renter is giving you 30% more than your mortgage costs, and if he decides that he really likes it, then he can buy your house for 15% more than it is worth. You don’t expect him to keep the house, but if he does, you make a lot of money.

  48. FrankenGoogle – $18 credit, sure! We’re way at the upper end on that one so I’m not going to add to it right now, we’ll see if we can roll it later.

    Moving to puts – staying more or less neutral but taking off profits where I can, very nasty market so far.

    LULU – I don’t like picking up high flyers on a sentiment change. Some day’s it’s smart to wait and see what the markets do, this may be one of those days.

    Anonymous – I have no clue.

    Without the financials, this rally is toast.

    Right now it’s one of our famous commodity rallys as the dollar dies. Woopie, what should we buy? BIDU in a power dive now!

  49. Anonymous, you did fill your NAME field in, right? Mine usually auto-fills, but not today.

  50. Q’s going to 53.60 again. YHOO going to 28, finally. GOOG just going wherever it wants.

  51. Phil,

    How do compute Yahoo’s stake at 50b? As per article on SeekingAlpha, it seems (as of now) about $7-8b or 15-20% of Yahoo’s 42b market cap. See

    late Monday night in California, in Hong Kong shares are trading at 35.75 Hong Kong dollars, which is up 22.25, or 165%. At that price, Reuters notes, the company has a market cap of $23.2 billion. So, let’s see.

    Alibaba Group hold a 75% stake in, which is worth $17.4 billion. Yahoo owns 39% of Alibaba Group, which puts the value of their share at $6.8 billion. The direct-owned 1.2% stake is worth about $278 million. That puts the total value of Yahoo’s interest in at north of $7 billion. That’s about 16.7% of Yahoo’s current $42 billion valuation.

  52. Phil need some advice about HMIN

    long DEC 45 C DEC 35 P 1/1
    shorted yesterday NOV 40 Against DEc 35

    now stock seems strong , My idea is to short calls too either 40C/45/50 depending on stock swing and if still over 40 near expiration. what about rool me on the puts to NOV 35 and play like bull put spread .. how do you see the stock ?? and strategy ??

  53. Wow what happened to BIDU?

  54. fredrang


    Being the cynic that I am I find it curious that they announced that deal 1 day before earnings and three firms affirmed their guidance. Makes me think an earnings miss is in the offing and they’re playing damage control…we’ll see.

    Also, I find it strange that they now are building 4 plants in Malaysia. Seems like spin to me. Isn’t it really just one big plant that keeps getting bigger? I guess it’s more impressive when you say you have 4 plants. If that’s true then it seems inefficient…I’d rather have 1 plant manager than have to pay 4 guys.

  55. Oh the heck with it, taking 2 more GOOG $690 puts for $14.20 for FrankenGoog in $25KP XXX

  56. Site down – Man was that hard to live without!

    Anonymous – Make sure the name/mail boxes above the comment input are filled.

  57. BIDU … will this be a major crash day; or will it hold 400 ?

    Also, word getting out on the China restrictions you mentioned yesterday.


    Hey Phil, should I adjust my Mar/Nov 140/135 spread? I’m starting to get the feeling that it’s getting away.


  59. Fab,

    Thanks, I didn’t notice the autofill got blown out somehow…I owe you a couple beers next time you are in Boston.

  60. Hey, I’m not anonymous !

  61. fredrang – Ooooh Boston… Been there once in the middle of winter, man was that cold! LA has made such a wimp out of me…

  62. Tech’s expensive… I don’t like any of it.

  63. Can someone be so kind to layout what the FrankenGoog looks like since I don’t seem to find it in the $25KP?

  64. DM

    Talk to me about that 125 support on SHLD. This thing’s in a free-fall.

  65. fwlt getting crushed also all week

  66. DM – AAPL and GOOD are getting less expensive by the minute… ;)
    YHOO seems to be looking for a floor at around 30 though, wonder if it will hold seeing the rest on the crumbling side.

  67. Fredrang – I think there’s some kind of place where you set an identity. I’m scared to go there myself for fear of becoming anonymous, otherwise I’d test it.

    BIDU bouncing off $400, let’s see if it sticks.

    Alibaba – CNBC just said $150Bn, maybe they were wrong but maybe they were considering that is only a small part of Alibaba holdings and applying the value through (something I discussed in last week’s Yahoo post).

    They raised $1.5Bn for 17% of the co and that’s now worth $4.5Bn so X 6 = about $30Bn so I guess reuters is ballpark.

    What happened to BIDU – reality!

    Speaking of reality, markets are negative. I’m off the DIA calls and pressing the $136 puts at $2.20 XXX

  68. Let’s see BIDU get CROXed !!

  69. GOOG is DONE!!!

  70. CLARIFICATION: GOOG is done going up. Not done making us money.

  71. FSLR can they hold on to 12% gain on a day like this?

  72. Out of my GS puts from this morning with $2.40 profit. They can’t fall like this all day and I like my money.

  73. IBM isn’t likin this

  74. Phil nice market call, Joined GOOG puts

  75. BIDU out + $1000 great call Phil maybe too early but too much money on the table to risk

  76. SHLD – getting sold off with the retail sector. I like it at 125, if it doesn’t bounce from that then it’s going to 120, then 105. It’ll bottom out around here for xmas, but I doubt it’ll be a sharp retrace higher from it’s bottom…. Something doesn’t feel right with the market…

  77. Volume looks like Q’s are going to bounce. Need whole market bounce so we can reload these puts.

  78. CDE went verticle for me this a.m. but needs another .1 for another leg or it goes

  79. IBM – It’s over for the company… If it doesn’t hold 111 and retrace back, good bye sally.

  80. FSLR going down! Grabbing the $155 puts for $5.20, stop at $4.50 XXX

  81. FCX @ 110.. again.

  82. VLO concall starting in a few minutes…

  83. Phil – thoughts on HSY at these levels?

  84. Vix is still down on the day, and C just popped back above 35 (low yesterday). Market looks very shakey, but if C does not break down, im guessing we bounce from here.

  85. C is going lower.

  86. SHLD – absolutely roll down if your caller is paying for it but if we have a really bad day today, it may be a while before we get a good bounce.

    FrankenGoog original play:

    Buy GOOG Dec $730 calls for $24.70
    Sell GOOG Dec $710 calls for $33.60 (credit $8.90)

    Buy GOOG Dec $690 puts for $19.80
    Sell GOOG Dec $710 puts for $28 (credit $8.20)

    BIDU with perfect 1% retrace (20%) off 5% rule back at $40, will be interesting to see what happens around this mark. Buying $420 CALLS for $12.75, will sell $400 calls as a mo play, can alwasy sell $400s against. XXX

  87. YHOO – if were cashed out is this a good entry for a new bet? What mo./strike?

  88. Screw this I’m not buying anything, I’m out.

  89. hawk,

    Thanks for the link. It looks too complicated for me as I’m try to focus on some simply plays for the $25KP.

  90. YHOO-

    Not sure I’d want to get in right now.

  91. SU-ATH you looking at puts Phil? I am thinking sell my calls

  92. BIDU-I bought some puts, between $403 and $405. Could be printing an ugly candle today, but will have to see the close.
    NOK-Anyone knows why it gapped-up this morning? WIll have to re-consider puts at close as well.

  93. Oil up $2.63 for the day!

    FCX – should come back here, copper is recovering on dollar weakness but back at 76 on the dollar there is a danger that someone will step in to prop it up. Once we go below 76, you can use a dartboard to pick winning commodity plays.

    VLO – I’d bet that CC down frankly. I’ve got Jan ’09 $80s and I’m covering them here with the $70s as I don’t see how they are going to project well unless they plan on charging $4 a gallon for gas next Q.

    HSY – I wouldn’t bet on discretionarys here, tempting though they may be.

    YHOO – I do like a Yahoo entry here and I do like shorting GOOG here (albeit just our little fun play) as a new $30Bn competitor in China that already has a native market share is effectively jeopardizing 25% of GOOG’s potential market – possibly more if you count Japan and possibly more if you give Yahoo some credit for being able to leverage this down the line.

  94. Oil

    Really interesting…Valero discounts to WTI are now up to $16 per barrel for Maya sour crude and $11 for Mars sour crude and the Saudi discount is over $4 per barrel. Margins are improving vs Q3.

  95. BIDU – Raising stop to $13, either they pay me or they don’t! I agree with DM – very ugly, not worth playing today, just looking for things to cash out.

    Doesn’t this “bad news in China” crap seem to have interesting timing to you guys. Remember when the IPhone came out and Jobs was crimalized over stock options. This is how Cramer and his pals get you out of a good stock…

    SU – you can’t short them with oil at $96, they make a fortune. Plus, nat gas is going down, also good for them.

  96. Oil inventories

    Part of the problem with backwardation pricing is there is no incentive to carry crude inventory so VLO is running very tight. It does not mean there is a shortage of crude, as we know, but it is a perfect setup to screw the consumer.

  97. Watch NYSE at 9,999, if they don’t break up I doubt the rest will. S&P 1,505 of course, Nas 2,775 is bad to the downside (especially with all these hot performers and upgrades today).

    Wow, check out MNTA – Ah, the joy of biotech!

    VLO – if what they are saying is true then A) TSO is being driven up for all the wrong reasons as that has nothing to do with them and B) there’s no shortage of oil!

  98. VLO still has another $1 billion in stock to buy back before year end.

  99. It is a screwed up business. When oil prices go up the refiners should go down. VLO and TSO would do much better making gas, jet fuel, distillates, asphalt with lower feedstock costs. Kind of crazy but I like VLO long term. I don’t think TSO is a good play because that’s the weak housing area where they dominate. As a matter of fact, VLOs weakest area was the West Coast demand.

  100. SU- didn’t short but took some off

  101. BIDU, GOOG, AAPL and even RIMM seem weak/toppy/tired to me today. Depending on the close this could be a change of sentiment. Now, what will the market do if the leaders are not leading it anymore?

  102. NDX-I usually don’t play this one, but it might be worth taking a look at if Cramer’s boys start dropping. Anyone familiar with it? Is the liquidity good?

  103. Phil -Anyone have a view on retail before Thursday’s numbers come out. Really beaten down sector- retail that is

  104. VLO – Last comment from me so as not to annoy. This is nuts…”the higher the price of WTI, the bigger the discounts we get on the crude we buy” i.e. the sour crudes. They actually said there are sour crudes they are buying at over $20 discount to the prices you see quoted on Nymex.

    Storage at Cushing: Lots of Canadian crude sitting at Cushing.

  105. VLO – yeah, buying back stock – whatever they do don’t build a refinery! VLO is a totally superior company to TSO and their capacity to accept that very sour crude makes them a winner in any market.

    The market looks like one of those really pathetic guys who doesn’t know when he’s being rejected and it keeps going after these levels that are way out of its league. Very sad to watch…

  106. CDE – like I said!!! :) Breaking up really isn’t that hard to do if you go with those little cute ones North of the border!!!

  107. Some interesting comments from an Elliot’s expert I follow. He’s been bullish from 1,400. His target was 1,620 on this run (he’s been very good at fixing targets, this is what these guys do), but he just changed his mind this morning and went neutral:

    November 06
    tuesday morning
    SHORT TERM: market gaps up at the open, DOW +50
    Overnight the Asian markets were mixed, but Europe came in 0.55% higher. The stock index futures rallied on tech news before the opening, and the SPX has hit 1511 within the first few minutes. Bonds are down about 1/2 point, Crude is up $1.85, Gold is rallying again +$13.00, and the Euro is making new highs. Support for the SPX keeps vacillating between 1506 and 1484, with resistance at 1530. Short term momentum is rising with the positive RSI divergence yesterday. While the market has held the various important keys levels during this pullback, the internals and some of the minor indices have been deteriorating. Last week we reported that the TRANsports, SOX, and R2K were in downtrends. Now the broadest measure of the market, the Wilshire 5000 is also in a downtrend. Also, the DOW components continue to weaken as only 40% of the DOW stocks remain in uptrends. With the ongoing narrowing of leadership, it is no longer certain that the SPX can reach the targeted 1620 area during this uptrend. Therefore we are shifting to neutral medium term. Neutral implies that risk in the market is rising and a correction is likely to follow. Will be reviewing the SPX/DOW charts today to determine what are the possible alternative counts. For now, leaving the charts as they are. The NDX/NAZ still have a chance to make new highs to complete their uptrend, despite the weakening of the cyclicals. We have good gains in the high cap techs: AAPL/BIDU/GOOG/RIMM, will be taking some profits nevertheless. Best to your trading!
    MEDIUM TERM: neutral
    LONG TERM: bullish.

  108. JEC and UPL rocking

  109. What’s the difference between sour crude and nymex and brent crude?

  110. Retail – well unless teenagers stopped eating in order to buy clothes (and with girls that is possible) then the terrible restaurant sales should translate to terrible retail sales, especially as mall chains like CAKE took such a beating. I really just can’t see playing anything up until we break 13,600 at least – or am I setting my goals too high?

    CSCO at ATH!

    MA just broke $200!

    Sold BIDU $420 puts for $35, now $31 against my longs.

  111. Agreed, Phil. And C seems especially pathetic in this bar at closing time, struggling to hold onto that pretty girl at 34.90 – 35.00. Any thoughts on a trade for this poor sucker?

  112. O no here come the rally monkies – time to swing?

  113. CDE selling here – this can’t be real

  114. parchesia

    This is a pretty good link re: crudes. Also, if you are interested in more data on the energy markets you can go to:

  115. Elliot – that’s a pretty major change of sentiment!

    Sour crude is harder to process.

    C – unless you are betting on the collapse of this country, going long on C is a good play. You can buy the ’10 $35s for $8 and sell the Nov $35s for $1.20 and then sell the Dec $37.50s at $1.28 and it will only take you 6 months to own them for free. Who turns this down? The trick is to enter in stages, maybe 25% of your target per month so you can make adjustments if necessary but that ROI is amazing. XXX straight to the LTP.

  116. CSCO- Far from ATH Phil. LOL

  117. optrader, great elliot post

  118. loaded on goog 700 puts

  119. YHOO – Seemingly stepping up from its 30 base, MA, MACD, RSI all curving up with volume going up to confirm (15 min chart).

    Removed covers on this drop, will look to reestablish at least 1/2 before eod or if it fails to go through with uptrend.

  120. C – so he takes her home. Great ending to the story. I’ll give the trade a try! Always like a happy ending.

  121. See C fall.

  122. Refining capacity

    Here’s another absurdity. With oil prices so high there are refineries that no longer are economically feasible according to the oil guys. That’s why VLO announced they are considering selling their Aruba refinery. Of course, I think they are just trying to strong arm the government because their tax status is about to change. They paid no taxes in Aruba…imagine the nerve, they want VLO to start paying taxes.

  123. Thanks for the crude info! For a while there I thought it was Wednesday because everyone on CNBC and on here were all talking inventories.

  124. CSCO – OK, 52-week high then! At some point we need to stop counting that nonsense last decade…

    GS re-denying rumors of a write-down. That gave us a push yesterday, maybe they can deny it every day at lunch!

    C falling – that’s fine if you’re selling $35 calls! We can always roll down, I’ll be fine if I end up owning ’10 C $20s becasue if they aren’t worth $20 then it’s time to learn Chinese and move anyway.

  125. Phil, Nyeh Hao ma?
    (That’s how are you doing in Mandarin!)

    OK, maybe at $20, even I’ll start buying Citibank.

  126. I had to get into SLV in my LTP.

    With sensational articles talking about how silver should really be at 30-40 per ounce I guess I couldn’t avoid the hype.

    If it does I’ll take a double and get try to time somewhat closely the top of a bubble… maybe get a double out of this.

  127. Chinese couple making love…..

    Chinese man says: I want 69! I want 69!

    Chinese woman says: Why you want beef and broccoli now?

  128. FSLR – did you stop out puts? I got in @ 4.7 but looks like it doesn’t want to go down.

  129. mmm Beef with Broccoli,my fav dish!

  130. GOOG, why you do me like that? Come on now.

  131. SLWBF – there’s that lagging pop I was talking about – 11%+ this time!

  132. fredrang
    VLO- biggest employer in Aruba by far, No one wanted that thing when they bought it. Spent alot of $$ upgrading the thing. Story isn’t as one sided as you think. Spent a lot of time in Aruba dating a Latina so I have seen what this thing has done for the island. When tourism died down following the disapperance of that girl from BAMA this was the only thing keeping it alive. No VLO for me

  133. BIDU-That’s some bounce. Maybe they are not that tired after all.

  134. lol citigroup is awesome hahaahah

  135. NOV- target hit at $76 so took some off. Took a little longer then I thought

  136. Film-I hear you, this is why it is so dangerous to try and pick a top. Shorts are still so anxious that they cover as soon as there is an uptick and it creates this kind of squeeze. Same thing going on with BIDU.

  137. GOOG flying now.

    Sellers ran for the hills on GS announcement but I still want to see some breakups. HOV says he sees a bottom but I’m not sure people are buying it.

    Ni hui jiang yingyu ma? Wo shi mei guo ren – Wo fingbudong. Or something like that!

    FSLR – doesn’t look like it wants to go up either, we’ll see how this run goes but I really think they will curl over by the afternoon. I think the sellers took a lunch break, floated the GS denial to spark the markets (and yes, one of the sellers is GS) and are now waiting for all the retail buyers to go “bargain hunting” on their lunch breaks so they can rip it back down in the afternoon. (just a guess).

    CY going parabolic trying to keep up with SPWR.

  138. LOL

  139. PFE is doing nicely.

  140. If you don’t know what’s phil’s saying in madarin

    Check here

  141. Here’s a idea I speculated on several days ago. With all the housing numbers, I looked for a derivative play and decided to buy a few puts in WHR. Looks almost like a waterfall chart to me. So far, so good. Also bought a couple puts in MBI since they have much farther to fall than some of the others in their category. Doubled down today.
    Other put ideas I’ve taken on very recently: CBRL, RRGB, MTH, RYL. (Not big amounts.)

    Maybe I’m crazy, but a lesson I learned from King Lear is: Things can always get worse. Wish I’d remembered that when I panicked out of all my housing puts after making some money — but not much — many months ago. I could have bought a house (almost) on what I gave up. (Of course, then it would have lost 10% of its value in the meantime.) “But they have to come back,” I kept telling myself.

    My gold options sure look beautiful today. Take a look at CDE. Their earnings come out a few days ago. Total crap. What a surprise! So I bought some more calls, thinking, “Well, we’ll see if even a leaky boat can go up with the tide.” So today, it’s going crazy (though it’s retraced considerably). Why? Maybe because they produce a lot, though inefficiently, so they’re a buyout candidate? Got me.

    Then again, silver itself has had a major breakout today. Looks to be a multi-decade breakout or at least on the verge of one. All the silvers (SSRI, HL, PAAS, SIL) except CDE have done well lately.

    Finally, for a penny play, I bought into CGLD on Friday at .69. Under a dollar and they’re producing gold!?!? Looked good to me.

    Thanks for all the community’s advice/comments. Wish I could understand all that you do.

    Finally, should I be buying some protective puts in gold/silver. Longterm I love this sector, but there is bound to be a sharp pullback sometime. But when?

  142. Phil, How have you adjust YHOO for the 10KP and 25KP if at all?

  143. crnt taking a dive before its secondary offering tomorrow

  144. That’s sick Dan, you know your stuff.

    Wouldn’t short RRGB though. WHR was a beautiful play to 75. Congrats. You should write more often with plays.

  145. $10KP:

    LVS – Selling $110s for $4.60, rolling Jan $135s to $115s for $5.50.

    PFE – DD on $25 calls for .05 (new basis .12, sell all there).

    T – Rolling Apr $45s to Dec $40s for .50. Rolling Apr $45/Jan $42.50 spread down to Apr $42.50/Jan $40 for a small credit.

    HMY – shoving Dec $10s to Nov $10s cost .30, expecting a small sell-off on a dollar bounce off 76.

    TSO – praying it finishes right here!

    $25KP Same as above plus:

    MSFT – buying back Dec $37.50s, considering rolling to $35s if it goes lower but I think that’s it.

    SHLD – buying back $135 caller at $1.75. Rolling all Mar $140s to Mar $130s for $4 and selling $130s against all 4 positions for $3.20 but hoping for better before end of day.

    NFLX – fine with our DD position but make sure you do if you didn’t already (rolling both $25s to 2x $27.50s)

    GOOG – on the open GOOG puts, we need to cover them, even if it’s a bad deal by eod. Right now the spread between the Dec $690 puts and the Dec $710 puts is just $7, that’s too low. Perahps we can sell current $690s against, remind me later.

  146. GOOG – since we have the open put in the $25KP, lets grab the $740 calls for $14.80 with a stop at $14 as a mo play, looking for $16.25 XXX

  147. T in the 10k? I’ve been shorting T since 42.

  148. this is bad lol

  149. Oh sorry, forgot to mention. If you don’t want to day trade the $25KP (requires you to keep $25K in the account) don’t take the side bets on Frankengoogle as they are all mo plays!

  150. Frankengoogle – you need a picture for that, it’ll be jokes

  151. Capital One-COF sees$4.9B in charge-offs in 2008
    This includes an “extra” $175M in Q1 of 2008.

  152. How have you adjust for YHOO? Sitting on YHOO Jan 27.5 calls and have taken a hit but wonder if the position is salvageable or should I just cut my losses.

  153. Everyone’s on their lunch break eh? Well today’s the day to do it… Chow.

  154. Phil, what about the T Jan ’10 $40 vs Dec $40 pair for the LTP? Look ok as a new entry?

  155. T – we shorted it too (sold calls against)

    Nice stuff Daniel. As to protective puts, I usually prefer selling calls against longer positions but there’s an art to the timing of it. If you have a couple of heavy positions I’d be happy to take a look for you.

    YHOO is out of both the $10KP and $25KP, made too much to risk. What are you left with?

  156. “The market looks like one of those really pathetic guys who doesn’t know when he’s being rejected and it keeps going after these levels that are way out of its league. Very sad to watch…”

    Brilliant analogy!
    I’m going to steal that one for my friends!

  157. Yhoo – Long Jan 32.5s covered by half Nov 32.5s

  158. T – I would wait on the sell side or sell 1/2 at most. To me it’s one that should bounce if the markets can claw back. Notice my $10KP and $25KP plays were generally bullish, it seems to me that we’re holding our floor and I don’t think we’re going to get any downside shocks (what could be more shocking than C writing of mega-Billions?) but a slow steady bleed if we’re heading down. On the other hand, a word from Paulson or Bernanke or Greenspan (if he decides to turn the market) could send us flying up. Path of least resistance is up at the moment but, on the whole, I’m staying pretty neutral.

  159. Phil, I’ve got the YHOO Jan 32.50′s, basis 2.75. Got any advice on this one?

  160. CTSH – too soon. Lots of time to catch a turn but you want to wait for at least a 20% bounce ($34).

  161. YHOO – it costs .50 to roll to the Dec $30s, if Yahoo doesn’t pop before then it’s over anyway. You can fund that roll by selling 1/2 the Nov $30s for $1.25 with a $1 premium.

    Lunch is winding down and we’re touching our critical levels: 13,600, 1,510, 2,800, this should be fun!

  162. T – I agree, I was kind of hoping for 39. I’m taking half out… It looks like we’re nearing a bottom…

    look at IndyMac (IMB)…

    “IndyMac Bancorp swung to a larger-than-expected lost Tuesday, marking the first time the company has reported a loss in eight years. The lender lost $202.7 million ($-2.77/share) compared to a gain of $86.2 million ($1.19/share) last year. Analysts had been expecting a loss of $0.46/share, while IndyMac had forecasted $0.50/share.”

    IMB is up today, and still looks pretty undervalued…

  163. Phil:what about HXL of the languishing Happy 100 portfolio….specifically the Nov 22.50 call that we sold ..tks

  164. NOV, RIG DO, etc! Sweetness!

  165. On the portfolio page, the $25KP stops at RIMM, and have no information on SHLD. GOOG is also not on the $25KP because it’s a risky play?

    You can clearly tell I’m new here.


  166. BIDU-Here we go :)

  167. Phil,

    I sold the Dec 47.5 NEM’s for $3.5 against my March 50′s $3.3 basis. I was thinking of rolling this to 2X Dec 52.5′s and 2X March 55′s but is there a better roll to pick up more premium?


  168. YHOO / Alibaba

    As I mentioned earlier, Alibaba Group has other pieces but none of them is going to become the next in the next few quarters. The most exciting piece is Taobao (the leading auction site in China with dominant market share). BUT, it’s losing a tonne of money and will not become profitable any time soon. Why? Because their service is free! That’s one of the key reasons why they dethroned eBay. eBay (or its JV with Tom Online) is trying to put together a comeback. Tencent (whose market cap is around the same size as our beloved BIDU) also has a competing product. Not to mention BIDU is eyeing this market too. This means Taobao will stay free in the foreseeable future.

    Alibaba now trades at 165x 2008 earnings. I think we’ll see $30 before $50.

  169. DM, Thanks for the response. Today is crucial for RRGB. It’s “kissing” its 200 dma. If it breaks through, I’m outta there. If it bounces back down, could be trouble (for RRGB). I like their food (though my heart cries out, “Bottomless fries?? No, don’t do this to me!”) but I see a double, or even a triple, top in the last few months. Of course, it could be in a channel going right back to $44. That may be the way to play it if today/tomorrow is good for them.

  170. If we don’t pass 13,600 today, would it be ok to DD on some Nov 135 puts I entered yesterday and am now holding at a modest loss? (Once again, was pulled away from the desk- missed the opportunity to sell yesterday… Day-trading is not for day-job folks…)

  171. Am I wrong to think that we are all set for a test of 13,600 and that if it isn’t broken we are going to sell off to the close?

  172. Phil, Thoughts on EMC? I have some Jan9 20s that have pulled back enough from their highs that I need to consider stopping out.. Bought for 3.8, was as high as 7.5. Currently 6. -Peter

  173. OK, someone please explain why we are rallying here.

  174. Phil,
    Concerning YHOO, has any one thought of asking “Why wasn’t it public knowledge that they were going to be on Capital Hill being grilled TODAY? Just wondering.

  175. We’re going to sell off sometime soon. It wouldn’t be a bad idea to start into some puts…

  176. Daniel – lol yah for sure…. The volume isn’t there for me, so I don’t really know too much about the company.. But Burger king posted a good Q not too long ago, here’s a quote;

    “Revenue climbed 11% to $590 million as same store sales in the U.S. and Canada rose 4.8%. Consensus analyst estimates were looking for adjusted EPS of $0.27 on revenue of $580 million. For FY07, which ended with the recent quarter, Burger King’s revenue climbed 9% to $2.23 billion, above its initial estimate of 6-7% growth, which it announced it would likely top in April.”

    The really interesting thing is that they grew in the US faster than Canada. They’re not exactly international like MCD and Yum, so I think this a better fundamental indicator of Fast food in America.

  177. Optrader, that’s just it- wtf is this rally for? Did everything get fixed overnight?

  178. parchesia – I think it is a bad idea to enter into puts now… Be careful.

  179. TXN- does anyone know why TXN is moving so much today? i cant find any news

  180. Douleclick, I don’t know. I don’t think oil prices got fixed too much LOL. But apparently that’s a reason to run today. Other than oil companies being such a huge part of the market now, I don’t see it.
    We are sitting at 136 right now.

  181. Phil,
    Plays mentioned above for 10KP & 25KP:
    Ones that you roll – can I use them to start a position as I missed the original plays?

  182. parchesia – With that said, I’ve been wrong before.

  183. DM-We’re at the day highs and if we don’t take them out soon. We should fail them. I’m not in just yet but i’m watching like a hawk.

  184. I’m not liking the action one way or the other. For every seller I see, someone is stepping in to prop it up

  185. Phil – Btw, when are you going to drink that cup of gasoline?… Valero did beat their estimates ;) .

    EPS were $1.40. Consensus analyst estimates were for adjusted EPS of $1.36… Youtube that!

  186. bio, looks like we are 20 years overdue for a rally. But, we are also 20 years overdue for a huge earthquake.

    Up or down boys, just pick a direction and run with it.

  187. Looks like that was a top. Watch the retracement and lets run….

  188. Down. That’s what I was thinking, too.

  189. Well, I tried to put my money where my mouth was, but only got half filled! !@#$
    I deserve it for not learning… especially after having cried about this on this site just a couple weeks ago.

  190. lol or you could just stay out hahaha.. Wasn’t everyone confused 5 minutes ago?… It’s like running (while blind and deaf) in a tunnel, except in this case, you don’t know which way the train’s coming from.

  191. LOL-more like 30 seconds ago I was blind. I’ve got my puts on a tight stop, dead even with that little dip and if we take out the highs, i’m out looking for a new re-entry.

  192. There’s some decent money propping it up but it looks like dummy orders that they’re bumping.

  193. It feels like the only thing keeping this market up is muscle from the Fed.

  194. Busy busy day. How’s everyone doing?

    BBD & Mr. Sparkle – “Yes” or “No” on Trinity River Project? So damn confusing…

  195. HXL – I keep hoping for a bigger sell-off but I won’t pay him a .30 premium for no reason as I only have to bite the bullet and roll him up anyway.

    Portfolio page: That’s strange, I didn’t know there was a lower limit. You need to download it here:

    GOOG is new and will be on this week’s update.

    NEM – that’s the right roll but this time put a stop on 25% of his calls at $4 and another 25% at $4.50 (at which point you can take 25% of yours off the table).

    YouTube was free…

    Nov $135 puts – rather than DD it’s really time to roll to December. That reminds me, GENERAL NOTE: All November contracts that you hold should be out of your folder by tomorrow. That’s why these channels are nice for selling puts and calls. Your callers and putters can stay as long as you are confident that you will take them out and not let them expire in the money next friday but DO NOT leave yourself in November positions (except a mo play) unless you have an amazingly good reason to.

    Man this market is one persistant guy! I guess he never sat through one of those “No means no” seminars at work…

    EMC – Like I said earlier, it’s a good time to take profits. If we’re going to 14,000 you have at least 2 200-point up days to jump back in on.

    YHOO – I can’t believe nobody knew. So much data, who can keep track though…

    That’s a triple break up – BIDU’s going the wrong way as is BA, AXP, EBAY, IBM, LVS, MSFT, YHOO, SNDK, SHLD…. same as this mornign so let’s watch this group for signs of a real rally.

  196. The way COH keep dropping it wont be too long before I can roll from the May 35s to the May 32.50s and let my Dec 35 caller pay for it.

    COH joining other retailers in early discounting. Offering 25% off merchandise in full price stores only.

  197. New guy looking to enter the weird world of FrankenGoog.
    Looks like the spread on the calls (Buy 730- Sell 710) is up from the original 8.90 credit to 11.20
    But the put spread (Buy 690 – Sell 710) has compressed to 5.9 from 8.20

    Given that the overall spread is the same ~17.10
    Should new entries be looking to enter both legs today, or enter the call portion today and the put portion in the future?


  198. Man – I just LOVE it when my stop loss becomes the low of the day . . .

  199. Oh and for everyone who doesn’t know, i’m playing Q’s, which may not neccessarily match what the market does tick for tick.

  200. So, what do you do at this point, wait for him to sober up, or start trying to match him shot for shot because he is just so darn persistent you think he has to pull it off eventually.

  201. I sweet talk the hostess into giving him a few more on the house before my next shot!

  202. Roll plays – they are effectively new bets so I guess the answer is yes but we already have profits on some from a previous sale so it’s not quite a trade in a vacuum.

    Energy is 20% of S&P and is up 3% so that’s +.6% of all market movement attributable to energy. Market move is…. .2% on the Nas, .5% on the Dow and .5% on the S&P. Add to that the fact that the dollar is testing all-time low of 76 and I am still inclined to short until we get a definitive breakout.

    VLO beating estimates – it was TSO. I would never bet against VLO. Sorry DM, better luck next time.

    BIDU back at $400.

    COH discounting – that is a really bad sign.

    FrankenGOOG – absolutely take either leg if you can get + $10! Just wait on the put spread but the idea is to buy very lightly and we work into the next set after getting one good one. At $11 or better that’s an XXX on 2 more in the $25KP with the $690 put still uncovered. Our goal is to never do worse than a $17.10 total spread.

  203. Phil,

    SBUX – picking any here?

    Alibaba – With well-funded competitors staying free, Taobao will not make the move to charge users and risk losing market share. That’s why Alibaba Group wanted to raise cash from the IPO to fund all these money-losing businesses. I’m sure they will churn out another one day. But not in 2008.

  204. Wondering if the Alibaba IPO marks the short term peak of BIDU…

  205. AUY .. Passed through 52 week high, any play on earnings Wed?

  206. We did not take out the lows so i’m bailing with a dime profit because I have to leave early today.

  207. anybody like puts on ABK or MBI on this strength? Seems like these are the types of stocks you need to sell on pops. Also, anybody have any thoughts on FTO? Looking at some puts, hoping for some not so solid earnings tomorrow. charts kind of scaring me though as it looks like it broke through some resistance at 46.

  208. Phil,

    Thanks for the spreadsheet.

    I also bought a contract of the call leg of FrankenGoog to test the water, and wait on the other leg.


  209. GOOG seems schizo. Wants to stay up here, but wants to sell off. Think I am going to hold some puts over until tomorrow unless there is a big break before EOD.

    Makes me wonder why AAPL has been so quite for the last week. IV must be way down, and yep it is. Near the lows of the last 6 months. Must be an opportunity there. Thinking about those Jan 220′s. That is close to my target price for Jan, plus increasing IV around macworld. Sell first week in January.

  210. FILM- AAPL, you don’t need it to scream everyday to make $$. Been daytrading the last 3 or 4 days pretty easily.

  211. Putting that AAPL trade in, Buy limit at $4.00 GTC. Will buy it all the way down unless Steve Jobs is seen with a Zune.

  212. True dat, BBD. Got a couple of those. But, I would prefer it to make bigger downside moves so I can buy more. I have very little right now. It makes me sad. :(

  213. BIDU puts-Taking profit on 1/2, letting the rest run, probably overnight if we close like this.

  214. Buyers may be done here, watch GOOG closely.

  215. Thanks, without PSW, I am like a fish out of the water. I just realized that today. I am so happy to see it back up again. Thanks Phil and the team. :-)

  216. Phil, (or others)

    I’m still holding CAKE Jan $25.00 calls, which are now at $.40. (about 80% down.)

    I’m curious--would you just close the position, or would you hold it in hopes the stock rises by January, or should I sell some other derivative on it?

    Thanks for any advice--

  217. AAPL going nuts. That’s it. There are too many people on this blog. ;)

  218. BIDU-Just bought back the puts at $405 (sold at $398). This volatility is amazing.

  219. Selling GOOG to fly AAPL??? AAPL has a tendency to keep going when making a new high. $.40 away from ATH

  220. Phil, your thoughts on chk earnings today? Would they be pretty similiar to SWN? Have half covered, wondering whether i should take advantage of the juicy premiums and sell more but the SWN response to earnings was pretty bullish. thanks

  221. Seriously, open a realtime chart on AAPL. It is ticking like crazy. Hasn’t stopped.

  222. Apple-AAPL moves higher on chatter if an iPhone partnership in China-Rumor

  223. I love the idea of the FrankenGoog play and have an order in to take the call side for a $12 credit. Thinking I can trade through this one even as I let my locked-in Nov play expire, hopefully between 700 and 710.


    “It’s alive. It’s alive… It’s alive, it’s moving, it’s alive, it’s alive, it’s alive, it’s alive, IT’S ALIVE!”

    “You have created a monster, and it will destroy you!”

  224. Thanks Opt. Do they like the rumor enough to get over 190???

  225. Didn’t I tell everyone to just buy buy buy AAPL? You can’t stop this train. It’s coasting right now which is very scary. Just awaiting it’s next pop to $200 and beyond…maybe after thanks giving wkd in the states? Sell your kid to buy AAPL lol.

  226. Denis,

    Tomorrows oil inventory report should have a bigger effect on AUY then earnings. Delivery to Cushing will be lower then estimated (no one wants to inventory crude at these prices). The noteworthy exception is Bush and his friends who are gouging us taxpayers at maximum prices while filling the SPR! The last report showed a 500,000 bbl SPR increase at then record prices. Now that prices are higher I’ll bet that Bush is drawing Cushing storage down as fast as possible. Looks like another dark day for Americans tomorrow as oil hits $100.00…

  227. Opt- where is this rumour?

  228. I think what’s moving AAPL is the confirmation of the Tablet (Newton) or whatever you want to call it :)

  229. Tablet? Quoi???

  230. Then you get Mac share reports like this and it doesn’t move the stock at all

  231. Thanks gt..

    OCR dropping .. looks like a Medicare Practices investigation.. Those are never good.

  232. We got $2 to go on AAPL.

  233. Oops, Nasdaq perking up, been too tough to call all day.

    CAKE – I hope you sold something against them at some point! The Jan $25s look kind of hopeless but, if you have margin, you can sell $22.50s against them for .40 and, if the stock takes off, you spend .90 to roll yourself down to the Jan $22.50s and then your first caller paid half of it. Once you roll him, you should be in decent shape (or at least better than where you are now. You could also leave yours where they are, buy the Apr $22.50s for $2.22 and sell the Dec $22.50s for $1 and your remaining Jan calls act as an upside stop. By the time you roll those to Jan, you should have collected your $2 back.

    CHK – I took the money and ran. They’ve shaved production to keep prices up so who knows what earnings will look like. Also, I’m pretty sure they unhedged, which turns out to be a mistake with no hurricanes.

    AAPL is being goosed along with many big names but there are a hell of a lot of sellers at the resistance levels. I will be impressed if they hold $190.

    CROX way down.

  234. Made another 20% on GS today…yaaawwwn.
    This is my new OIH for the time being

  235. Film- AAPL- you ask for $190 you get $190. Re-entered as a MO play.

  236. yeah, I am Mo’ing this thing for today, but out if it drops back below 190 decisively.

  237. I am not buying the GOOG rally on AAPL’s rumor though.

  238. Phil-

    I waited on the FSLR 155 puts and got in at 4.50. Is the position worth holding overnight or just get out with a small loss? Thanks.

  239. Can someone tell me what the actual AAPL rumor is? I can not find anything to explain the huge spike in vol or price so fast.

  240. Might be time for a GOOG put for a 5 dollar pullback mo play

  241. Opt, I can’t get chased out by a low volume gap on NOK on no news. You hanging? I am buy another 50% of my Jan’s.

  242. scroll up Bigcat

  243. Solar

    I think we need Al Greenspan to dub this irrational exuberance.

  244. WFR decided it wanted to join the club (Schaeffer finally got one right).

  245. NOK-I sold most of them on pullback earlier. I just want to stay disciplined and take a small loss as it is above my stop. I will re-enter when I get a signal.
    AAPL-The rumour was on flyontheewall

  246. MrN – Schaeffer lol, even a blind horse finds water some days.

  247. SPWR

    Must have been one hell of an analyst day for these guys.

  248. got GOOG Nov. 740 puts for 15.8, dangerous mo play

  249. SPWR

    Yes the stock was as low as $92 on 10/22…topped $150 today. Is the sun hotter than it was last week? It must be that Al Gore is running for president.

  250. look at mbi the last 5 minutes

  251. XLE looks like a good place to buy some puts. Bears have to show something tomorrow to keep this from becoming a real rally.

    Taking a small portion of Nov 78 puts for overnight.

  252. TOS is down. Aaaaaarrrghhhh

  253. phil, what do you think of buying C (stock) here, with a jan 35 put and selling the jan 40 call?

  254. my tos platform is up

  255. What a nice little rumor to stop a slow drift down from becoming something.
    Now, any dip down and I’m Kramer at the horse-betting counter…

  256. correction – its down – just got an order rejected

  257. fredrang SPWR- I bought at $87 the day after earnings. Rolled twice already will do it again tomorrow.

  258. Oh – I forgot about CSCO tomorrow! This is some sort of expectation of a big tech rally.

    FSLR – SPWR makes me nervous on this play but I’m going to hold it because I’m light on the put side.

    Irrational – we can’t think like that, if the market breaks up tomorrow we have to say Yee-Haw and BUYBUYBUY until we get technical signals to cash out.

    BKX up 1.5%, that’s the first time in a long time. AIG rockin’

    CY is still nowhere near reflecting the run in SPWR, I think we have to buy more CY if SPWR breaks $150 and holds it.

    Oil at $95+ justifies 150% more solar projects than oil at $80, solar is a better play on high oil than oil is. Damn, someone just hit a buy program big time!

  259. I want to short something but I’m chicken.

  260. What are people doing about csco earnings?

  261. C – I would just buy the stock at this price. I don’t see it going lower and you can always sell the Jan $35 calls to cover yourself.

  262. Phil — after the close, would appreciate your current frankengoogle spread. would like to compare mine with yours. legged into the initial spread with 17.6 credit. by taking mo a couple of quick mo plays using only 2 contracts at a time, i’m up about 2k on the whole thing. where are you now on this?

  263. Just checking in… WOO FCX held 110, is now showing who’s the boss.

  264. FSLR
    Thanks Phil. They report tomorrow after the bell if you didn’t already know.

  265. OK, this is really frustrating, not being able to do anything about my puts because of TOS. I had to buy some calls on another account to lower my overnight risk, but I don’t even know exactly what I have on TOS. First time it happens.

  266. My TOS is down but my PaperMoney account is up. Their voice line appears to be busy?

  267. CSCO – we bought them on the 26th,Dec $32.50s for $1.40. I took out the $32.50 calls I sold for a small loss and I’m selling 2/3 the current $35s ahead of earnings (not that they’ll help much on a miss).

    Well we broke out on the techichals. Taking strangle of DIA $137 puts at $2.06 and 2x $137 calls at $1.28, should be fun.

  268. First time I expericend that TOS is down (have been using it for 6 months alread) …

  269. COH – thats really shitty that they’re offering discounts. Very unlike them, not too sure if that’s a bad thing or not for them. I’m sure retail will be fine, canadians and europeans will clean out the stores. If Urban Outfitters had a good Q, then COH would be A-OK.

  270. FrankenGoogle – I got killed waiting on the put side and I”m goign to spend $6 to roll the Dec $690 puts up to Dec $710 puts and wait until tomorrow to see what needs to be done about it but it was not a pretty entry today.

  271. MMM – Whole bag of glory with this one.
    IBM – Needs to break 115, before we’re gold on this one… Else LOWER.

  272. HL up 14%

  273. IBM didn’t break 115?… dammit, I just set too high of expectations for this one… :/.

  274. Hope you all got some of that AAPL lovin’.

  275. Gold at $28 year high, oil at 20-year high, Dow at 13,666… So hard to switch off my brain but we have to follow the herd for the duration.

    Well, time to dust off the old rally cap and hope we can follow through tomorrow.

    AAPL – what an amzing stock and company!

  276. CAT’S NO DOG! Excellent performance from this stock today.

  277. That was an ugly day for me. I am really mad at TOS as I could not get out of my trades when stops got hit.

  278. Phil- in general is it better to roll short options that are ITM back a month as the stock increases or should we wait for a pullback? I know in general that you should only roll as the premium becomes unattractive and the spread between the potential roll call and your current roll call begins to deteriorate. The reason I ask this question is to get some insight into how the spread between say MSFT Nov 35 and Dec 35 changes as the stock goes up and down.

  279. Phil,

    Is it your plan to start the $10KP fresh on 11/19? I read that from the newsletter but you were rolling a lot of positions instead of closing them today.


  280. Phil,
    After-hours long question for you…

    I’ve been studying/paper-trading more diagonal spreads lately, and after getting more comfortable with my ability to pick wisely based on daily/weekly charts, I’ve entered a couple.

    My question is this: I got into a calendar spread of LLL (Dec 110 @ 3.50/Nov 115 @ 0.45). At the moment, the spread is up ~1.65/contract – which is good! The stock has been on a steady march to 115 and I’m thinking there is a decent chance it might get really close by expiration. So now how to exit…

    1) Close it out for the ~1.65/contract profit.
    2) Wait for expiration and really grind out the time premium on the caller, hoping he expires worthless or just get called away.
    3) Roll the caller to Dec 115s for +$2/contract

    I’m thinking 1 or 2. Thanks for any advice!

  281. “Oil at $95+ justifies 150% more solar projects than oil at $80, solar is a better play on high oil than oil is.”

    Uranium is also in this category. It was a big up day for them and I’ve noticed that they go up and down roughly parallel to oil’s rises and drops.

  282. Go AAPL GO!!! $191 yeye

  283. Hello,

    I have just joined this site and am having a difficult time trying to figure out how to start modeling my portfolio. I do not have large funds, so I would prefer to follow the 10k, but the spreadsheet I viewed has tons of already open positions. I would prefer to start from fresh positions. Is there a page on this site that will alert me when I should open a new position? I appreciate any help.

  284. AAPL afterhours now to $192.10 and climbing.

  285. Hey Blake! Welcome! – you’ll either have to go through the intraday and wait till Phil XXX a new play that goes into the “10K” OR wait for the recaps and through them.

  286. Yep, sold my 3 Frankengoog 710/730 vertical calls while TOS was down, $12.10 credit. Now the waiting game begins. I’m sure in a couple days I’ll be ready to sell the 690/710 put leg…unless there is a better entry by then.


    OVEN up nicely after hours.

  287. ECOL – Anyone follow this one? I own a little myself and it seems like it’s also a good play on nuclear energy, and in particular the waste biproducts of it. No options available though.

    From the yahoo profile:
    “American Ecology Corporation, through its subsidiaries, provides radioactive, hazardous, and industrial waste management services in the United States. It accepts hazardous, polychlorinated biphenyls, low-activity radioactive materials, industrial and low-level radioactive waste, and naturally occurring and accelerator produced radioactive materials.”

  288. Thank Demetrius,

    Is XXX the signal that phil is starting a new position?

  289. seattle,

    I have a boatload of ECOL – had it since it was trading around 3. Its been holding up well after breaking above major resistence. Its a good company in a necesary sector and it pays a dividend; only negative thing is the stock isnt optionable.

  290. Hey Phil, I’m looking into STLD as a potential LEAP play perhaps with the jan 09 55s first naked for a while and then covering with the nov 55s on a decent run. I like the company from a fundamental and technical perspective although the slowdown in housing construction and automobile production seems to be a drag on the earnings this year for the company. From a technical perspective, it did break out of a cup and handle base with huge volume only 2 weeks ago and now just bounced off the 20day MA.

    I was wondering if you could just briefly walk through the thought process about why it is or is not a good trade from the option chain perspective. A couple of days ago, I know you mentioned the relationship between front month sales and being able to use the money from the sale to roll. At the moment, the .9 or so I could get from the Nov 55s covers only about 1/2 the roll down to 50 for my leaps in case of a move downward. Is this a problem? 55 does some like short term resistance so that if the stock were to go up a couple more dollars, I wouldn’t hesitate to cover with the Nov 55s. It seems though by looking at the Dec options that you can get around 1.8 premium/month which over around 6 sales would make up the cost of the leap. Am I thinking through the process correctly? Thanks.

  291. XXX is new / adding / adjusting… You’ll have to keep track of those with your current positions, but it’s safe to start a new position on his XXX play.

    You can tell when how bullish / bearish on a position by the way he writes.

    Hope that helps.

    You should also review the K1 project posts to get you up to speed as well, it’s a really big help.

  292. Blake, “XXX” means that Phil, has PLACED an order. It’s not always easy to follow, since his order may not fill.

  293. XXX is also when he’s closing a position, don’t start one when he’s closing a position. That would be bad lol.

  294. Nile afterhours is wicked.

  295. Guess raised retail outlook?? Nile beat estimates???? Urban outfitters Tops Sales Targets? Some guy is buying Citigroup? 65% of firms within the S&P 500 have released results.. and they’re still in double digit growth?!??!

    What does that mean?… Did I hear that correctly?… The consumer isn’t dead?… the rich are still spending?… What?! Retail is a buy?.. No it cannot be… but but but subprime.. and uhh… the lower income…. yah that’s it…. No I don’t care about higher employment… Or outside spending…. No I won’t listen nah nah nah.

    Go cry me a nile, cause THE CONSUMER IS HERE TO STAY. Get your black cards out, cause it’s buy time for America.

  296. MSFT – I wish there were a simple “one size fits all” answer for when to roll but it very much depends on how you feel about the move that put your caller in the money as well as how much profit you have and how much additional risk you are willing to take. From a rules perspective, your MSFT Nov $35 caller was killing you yesterday at $2.25 so, when they dipped down to $1.15 today, you should have recognized it as a $1.10 gain and stopped it out. That is, of course assuming you felt your long MSFT was something you wanted to hold naked or at least as a wait and see.

    One thing we should talk more about, as I see this mistake made a lot, is that Losing Less is the same as Making More. This is something I don’t think a lot of people get. When you have a loss and you get even – be happy, get out or lighten up as you were obviously wrong when you entered the trade so maybe you’re still wrong and just lucky at the moment. Always keep in mind that time works against you so, with a November contract – if you entered 2 weeks ago and were totally screwed last week and now (with 8 days left) you get even – why risk it? If it goes against you tomorrow you only have 7 trading days left to get lucky again and it took you two weeks to get lucky from last time.

    That is the general advice. Then you have to take into account your target and the market and what’s happened since then.

    $10KP – yes I’m starting it fresh but that doesn’t stop me from taking care of curent positions!

    LLL – You have $110s that are well in the money at $6. Your caller is $1.50 out of the money and costs $1 with 8 trading days remaing. There is no reason for you to give him $1. His total premium is $2.50 so any day the stock doesn’t go up .30 he is losing ground. You have a premium too and if it were my position I would take the profits off the table by rolling to the Jan $115s for $4.20 and let the caller ride with the intent of rolling him to the Dec $115s at, hopefully $3 so I’m all cashed out with a free spread.

    Hi Blake! A new $10KP will start next Friday. Meanwhile if I see a $10KP posiition I usually identify it as such but I like to be sure of market direction before making those picks and that simply hasn’t happened yet this week.

    GM taking a $39Bn Q3 charge (just to the books though). Something to do with the union settlement. Still, I doubt anyone wants to see the cold reality of that loss finally booked.

    ECOL – I like CCJ way too much to stray and no options is too dull for me.

    XXX is a position I generally recommend but if I recommend for the $10KP or $25KP I specify the portfolio and number of contracts. MOST XXX positions are not at all appropriate for a smaller portfolio.

    STLD – good company but I usaully want to initiate an LTP position when a company (like C) is beaten down, not up 80% on the year. If you take an ’09 $55 for $10.60 you can sell the Dec $55 for $2.83 and a roll down costs you $2 so that’s not bad from that perspective. Yes I would sell the November $55s before rolling to the Dec $55s but I would certainly not jump right into a full position here as it has a lot of room to drop. I may track 50 different companies and maybe twice a month I will decide I like the entry point for the LTP on one of them.

    XXX – sometimes I am just recommending something and don’t order it. I try to get to them all but if I already have 6 GOOG positions and I see one I think is worth buying, I’m not likely to make it positon number 7 for me. Also, often I already have something very similar and the reason I XXX the trade is because I see a set-up I like better than the one I’m stuck with!

  297. Consumerism: AXP, SHLD, COF, JWN (just got a downgrade), TGT, WMT, HD, LOW, ANF… so many nice, juicy beaten down companies!

  298. Jedda- you on this evening? I saw your comment about the math for when a caller goes ITM, and wanted to follow up if you were around.

  299. re COH discounts, snail mail invitation to “preferred customers”. The 25% discount is good from Nov 10-18, good for one transaction only and only on the Winter 2007 line. Looks like they need to bring in some traffic…

  300. Phil,
    Thanks so much for responding on my spread on LLL, I really appreciate it.

    Every time I think I’m getting better at this, I realize I need to think another step. Roll ‘em, roll ‘em, roll ‘em…

    On the plus side, at least I got the direction correct! I figure that’s 1/2 the battle.

    An aside, something like 65 people downloaded that DJIA worksheet I put up last week. I didn’t think that many people would use something like that. Also, I’ll put up another oil contract open-interest graph. I think we’ll see the open interest in January cross over the December contract early next week. (My guess is Tuesday.) Though with the price increase in the front-month, there was actually a mild uptick in open-interest in Decembers today. Go figure.

  301. Mr_Sparkle- you can add one more onto that download list. I haven’t got to it yet, but will soon. I’ve been interested in calculating the arbitrage spread between the Dow futures and the Dow internals for a while (it’s a McMillan thing).

  302. Apart from Oil today, it seems to me that very few stocks are propping up the entire market, notably FrankenGoogle (ridiculous !), RIMM (super ridiculous ) and to some degree, GS. And I guess now CSCO. Google is just nuts.

    Let me tell you, when GOOG finally drops, BIDU is going to totally crap out. They’ve programmed that junk to track GOOG, but even that failed today.

    The move in the market this afternoon was completely mystifying.

    And $100 oil coming tomorrow (maybe).

    Getting ready to short OIH and SU.

  303. FSLR

    From Andrew’s column: (FSLR) – Phoenix-based solar cell maker First Solar Inc rose 12.25% this morning to $166.24, an all-time-high for the stock, after securing contracts to supply solar modules for household electricity to Australia’s Babock and Brown and to Ecostream Switzerland GmbH. The deal has been valued at $1 billion over the next 5 years. First Solar’s share price has enjoyed an uninterrupted charmed run since its initial public offering in November 2006. Since starting trading at $27.54 at the start of this year, the share price has risen relentlessly, culminating in today’s unprecedented high of $165.49. A look at the option action, while showing an unsurprising proclivity to the call side activity, shows traders imposing a clear price ceiling on First Solar – perhaps mindful of the solar cell producer making like Daedalus and flying a bit too close to the sun. Buying pressure was seen in the November 160 calls, which are in-the-money but given today’s $12.60 require another 4% upside move just to break even. High premiums appear to have encouraged some traders to control trade costs through call spread buying in the November contract, buying the 170 call against the sale of the 175 call, establishing an anticipated price ceiling for November. Traders in the December contract shorted the December 180 call at 4 times the existing open interest. Yesterday this position could be had for $4.34 – today the price is $11.00, which goes some distance in explaining why a trader might seize the chance to sell these calls now on massively inflated premiums and buy them back as premiums erode closer to expiry, and as First Solar’s share price becalms.

  304. PHIL-good after hours thoughts/lessons etc!

  305. DM, everything I am hearing about retail (from companies, or people who talk to companies) is negative. FYI.

  306. chix0r – I remember they were talking about increasing foot traffic in their conference call… Maybe that’s it?… Mail outs seem smart for them. I like the idea.

    A lot of companies are juicy, but the steaks seem blue-rare… Just a couple more minutes on each side, and they’ll be perfect.

  307. Cap – Would you short retail?

  308. 9:49 PM

    Gold up apprx. $25 since midnight last night (+3%).
    Silver up apprx $1.15 since midnight last night(+7.8%).

    If we’re getting our 4th quarter rally, it’ll be tech, financials, and retail, if past performance means anything. I certainly would be leery of financials, but this is usually a good time of year for them. And it’s hard to keep Americans from spending at Christmas time. This coming from a holiday grouch so it must be true.

  309. Wow, look at the dollar go down tonite…

    That was a dramatic move

    very sad

  310. DM; I dunno, don’t follow most of those companies right now. But the stuff I am hearing, particularly on the apparel side and anything related to the home, isn’t good.

    Electronics might be safer haven. Might. I think this could also affect shipping and transports, even stuff like DRYS as there is a lot of merchandise that retailers don’t appear to want.

  311. Chinese advisor says they may diversify their (trillion+) Dollar holdings.
    I’m short the dollar so have made some good PIPS on this BUT – I don’t think the Chinese are so dumb as to hammer the price of their holdings like this. I think it’s just a threat to Ben that if he cuts again they’re going to be REALLY pissed off and may start selling their greenbacks. Chance of a rate cut in December should fall now tomorrow and with it, the equity markets. Could see some Dollar strength too, shocking as that may be!!

  312. Cap,

    I’m hearing the same thing anecdotally. My g/f is a buyer for a large retail apparel chain, and she is having a very tough time right now with her suppliers. She’s in Hong Kong right now, and I just talked with her. She said the suppliers are trying to be nice, but it’s a battle to find anything at a price she thinks will sell in her market over here. That market, BTW, is decidedly mid-scale, so it’s very price sensitive. She had the same to say about suppliers in Singapore, Taipei and Bangkok on this same trip.

    While she’s currently buying for spring and next fall, the prices will be shocking to the average consumer. So if retail isn’t done for today, just wait another few months. Right now, I have no faith in retail, other than the very highest end.

    Frankly, I doubt DRYS will be affected by this though. The dry bulk carriers don’t carry container cargo, and that’s how most consumer items are transported. Currently, DRYS, DSX and others are being affected by iron ore transport prices that are being renegotiated in China. There’s lot’s of bluffing and huffing and puffing going on, and that will continue until a final contract is negotiated probably sometime in February. So for the dry bulk sector, expect continued volatility at least through Feb.

    If you’re interested in shipping, you might look at the tankers. Typically they dip this time of year and move up through the spring. This has been going on for years. Since I just bought some FRO, I hope this cycle continues.

  313. Thanks Richard, good comments.

  314. Cap – Don’t you think everything you hear is after the fact?… After the stock goes down, a bunch of analysts jump on board saying it’s a bad sector to be in. After apple goes to 200, analysts start to love it…

    They look for reasons to confirm a trend, rather than reasons to go against it. It’s very academic.

    Basically, as long as the consumer has money to spend, then they’ll spend it. I’m not going to be a hero and call a bottom… I’ll wait for some price action. But for fun, lets look at COH fom Q4 2006 (Aug 1st).

    These are their earnings in order: 31(Q4),31(Q1),57(Q2),39,42,41(Q1)
    In this time COH went from : $30 to 55 to 30 again today.

    Right now the company is trading at a 10 cent eps discount… If xmas turns out to be their best season again, then we’re looking at a 20 cent eps discount if Q4/Q4 growth is flat, and 30 cent eps discount if they maintain their current growth.

    Turning the tables; Lets see what the analysts are seeing: Slowing consumer. Okay I got that release too.. But who’s slowing? Are we even actually slowing?

    Summer spending was fine.. But even if it wasn’t, COH doesn’t exactly deal with sub-prime customers. “Is that a platinum visa? Sorry Walmart is down the street”

    Betting against retail companies like these, is like betting on the rich dieing out on the biggest holiday of the year.

    SHLD’s decline was a bit more justified because they’re reliant on real-estate… But as soon as the housing thing corrects, then I’m sure they’ll start upticking again…

  315. Richard, Cap, DM- I totally dig the fact you guys are up late discussing the strengths and weaknesses of different market sectors. It’s like an intellectual smorgasbord, and I’m starvin’.

  316. Cap, one more thing.

    I think you’re dead on in your assessment that the falling dollar will affect the container shipping companies. We’re already seeing that to some extent for a few of the leaders in this sector, as most hit their highs in July and haven’t recovered. The sector is hyper-competitive and is filled with armadas of small players, so I am not nearly as bullish on this sector as I am on dry bulk or tankers.

  317. Richard – you make good comments, the weaker dollar hurts the buy-side of retail. Volume just has to outpace the tightening margins. The market already priced in that it can’t.

    Always good to hedge.

  318. lol K1, what do you think? long or short on retail?

  319. USD update – The Asians are killing the USD…

    USDCAD is 9102
    AUDUSD 9366
    USDJPY 114,20

    Not good, for the CAD and Aussie pairs, but yen might hit a floor at 114

  320. DM,

    I always think your analysis is dead on, and that is one of the reasons I went a little long on C today.

    However, I don’t think we can compare what might go on with COH with what might also go on with M or JCP, for example. High end will be fine, as it typically always is, even including SKS and JWN.

    My concern is for the Macy’s of the world. What about chains, or mall anchors, that thrive on the middle level of consumer? TGT and WMT should do OK, as they typically seem to, but my concern is for the middle guy, and I don’t think those retailers are OK right now.

    What do you think?

  321. K1,

    G/f in Hong Kong – otherwise this wouldn’t work at all, as you can imagine!

  322. LOL- you guys are killing me. But the wife is calling, time to get off the machine. Catch you cats on the flipside.

  323. Richard – Do not get me wrong, I’m completely with you on the middle-class retailer argument.

    If I was running any of these companies, I would definitely be hedging against the USD as soon as I heard they’re cutting rates. This thing is on the news, it should be automatic with these retailers, but we shouldn’t make bets on it.

    JCP got killed, and it’s feeling a bit over done… I don’t like the company, but it’s interesting to note that the entire sector got sold off with them…

    LULU is my favorite at these levels, but I’m waiting until it bottoms out. The lines literally go outside from the Canadian stores. High markups and it grabs attention, I couldn’t ask for anymore.

    With that said, most retailers on the CDN side are getting killed because they’re boarder jumping. That helps america, not much.

    But you can be assured that Americans are atleast shopping inside the economy… Going to Harrads is like asking to be bankrupt….

    At worst, I think the retailers have a couple good quarters left. Atleast before the purchasing prices get passed down to the consumer. So worst case, it’s a dead cat bounce from xmas spending. Best case, we nail the retail bottom.

  324. lol 12 hour delay, love the HK time… I’m off, need to rest my eyes.

    It’s been fun, Cheers.

  325. Very good discussion tonight!

    Retailers (big ones) do run currency arbitrage but I’m not sure how many of them got this right. Conventional wisdom says “everybody” is on the downside of the dollar but for every buyer, there IS a seller – it’s just a question of at what price. I know from my Vegas days that if you need to rustle up some suckers to bet on the underdog, you go to their home town – I imagine we’ll find that many less-than-savvy US currency traders have made very big and very wrong bets ON the dollar and, if someone was a good currency trader, they’d be working at Goldman’s, not Macy’s.

    So let’s look carefully at retail reports for “currency losses,” which could come in high this year.

  326. DNDN activism:,215105.shtml

    Also, I got this via Email, no source cited but I’ve heard these accusations of the FDA being tainted before:

    Prostate Cancer Group Urges Congress To Probe FDA Matter

    A prostate cancer advocacy group is using Metro buses in its latest
    effort to attract congressional interest in accusations of back-room
    deals that have kept a potentially life-saving drug off the market.
    Care to Live has been making noise on Capitol Hill over Provenge,
    an immunotherapy drug for late-stage prostate cancer meant to give men
    an alternative to chemotherapy.

    The group this week bought almost $12,000 worth of ads on 25 Metro
    buses around Capitol Hill and FDA’s headquarters in Rockville, Md.,
    which state in part: “Provenge Confidential: The darker side of the
    FDA’s war on cancer.”

    The group’s goal is to catch the eye of lawmakers driving home and
    pique their interest in the Provenge saga.

    An expert advisory panel overwhelmingly recommended FDA approve the
    biotechnology company Dendreon’s Provenge in March.

    A month later, two panel members wrote FDA over concerns they had
    with a Provenge clinical trial, including oncologist Howard Scher, who
    has been tasked with doing research for the competition. FDA granted
    Scher a waiver, but the group believes his conflict is deeper because he
    serves as a scientific adviser for ProQuest Investments.

    ProQuest is invested in Novacea, the company working on an
    end-stage prostate cancer treatment whose clinical trial was halted
    Monday after preliminary results showed an increasing death rate.

    The agency decided to delay approval of Provenge and requested
    additional clinical data. Karen Riley, a spokeswoman for FDA, said the
    agency had questions about the effectiveness of Provenge, but that did
    not signal the end of the line for the drug.

    “FDA is committed to working with Dendreon so that it can obtain
    and review new information as quickly as it becomes available,” Riley

    Care to Live, which is suing FDA over Provenge, wants Congress to
    investigate FDA’s move.

    “I can only speculate why [FDA delayed approval], but it’s pretty
    fishy at best,” said Wisconsin anesthesiologist Chuck Bennett, a Care to
    Live advocate.

    The group, which has members who are Dendreon investors, has held
    three rallies, including the most recent one in September outside FDA
    headquarters. It launched the month long ad campaign Monday.
    “We hope that Congress will see those ads and maybe hold a
    congressional hearing,” said Melody Davis, Bennett’s wife and Care to
    Live’s spokeswoman.

    The group has had a tough time convincing lawmakers who recently
    have come down hard on FDA for approving drugs that turn out to have
    deadly side effects.

    “There is political pressure on the FDA to slow down approving
    chronic medications for chronic conditions … but a lot more people are
    dying because they’re not approving a drug like Provenge,” Bennett said.

  327. Asia Markets : Tuesday, November 6, 2007

    (The following is from WSJ; please cross check with other sources to confirm.)



    Hong Kong*


    DJ Shanghai*






    Baltic Dry Index (BDI) +66 10605

    BDI Charts & Spot Rates –

    * at close
    Sources: Dow Jones, Reuters

  328. Asian Markets Are Mixed, Strong Yen Sinks Japan –
    Record-high oil prices continued to boost Asian resource stocks in the afternoon session Wednesday. But a weaker U.S. dollar pushed Japan into the red.

    The dollar fell to new lows after a senior Chinese political figure said China should balance its foreign exchange reserves so that strong currencies such as the euro offset weakening currencies such as the dollar.

    The Nikkei 225 Average hit a 7-week closing low for the third straight day after morning gains were undermined by a surging yen;South Korea’s KOSPI ended 0.5 percent lower after just missing a record high, as stocks sensitive to fuel costs such as Korean Air tumbled on record oil prices; Australian shares finished nearly 1 percent higher, gaining for a second straight day; In markets still trading, Singapore’s Straits Times Index was flat after spending the morning session in positive territory;Hong Kong stocks jumped over 2 percent as property shares rallied further on recent rate cuts
    and asset inflation expectations, while record crude prices pushed up PetroChina and other oil issues. traded heavily, dropping 10 percent, a day after shares in China’s top e-commerce firm about tripled in their spectacular debut;Most Chinese shares fell as supply and policy worries continued to weigh on the market, though the Shanghai Composite Index rose as some blue chips rebounded from Tuesday’s steep falls.

  329. European Shares Erase Gains on Strong Euro Fears –
    European equities hit session lows and wiped out early gains on Wednesday as the euro hit a fresh record high above $1.47, stoking worries over the impact on corporate earnings. By 0935 GMT, the pan-European FTSEurofirst 300 index was down 0.3 percent at 1,549.4, after earlier rising as much as 0.6 percent. Insurers Standard Life and BMW figured among the main losers, but the market was still supported by mining stocks which tracked gains in copper and gold prices. Oil shares were also higher

  330. Euro Hits Record High on China Reserve Comments –
    The euro hit a record high against the dollar on Wednesday after a senior Chinese political figure said China should balance its foreign exchange reserves so that strong currencies such as the euro offset weakening currencies such as the dollar. The euro was also supported by lingering market expectations for the U.S. Federal Reserve to cut interest rates in December, and for the European Central Bank to keep euro zone interest rates steady for a while.

    The euro rocketed higher after a senior Chinese political figure commented on diversification of China’s $1.43 trillion stockpile of foreign exchange reserves. “For instance, the euro is rising and the dollar is weakening, and we can achieve a better match of the two,” Cheng Siwei, vice chairman of the Chinese People’s Political and Consultative Conference, parliament’s top advisory body, told a financial forum in Beijing on Wednesday.

    After reaching a new high, the euro quickly extended its gains to rise to a record high of $1.4666 on electronic trading platform EBS. It later trimmed some of its gains to stand at $1.4613 for a gain of around 0.4 percent on the day.

    The dollar index, which measures the dollar’s value against a basket of major currencies touched a record low of 75.503. The dollar also fell agains the yen , down from around 114.70 yen in late U.S. trading on Tuesday.

    U.S. federal funds futures pricing on Tuesday implied a roughly 65 percent chance of a Fed rate cut in December.

  331. Oil Tops $98.50 on Weak Dollar, Winter Fears –
    Oil prices surged to more than $98 a barrel on Wednesday, ploughing deeper into record territory as the dollar plumbed new lows and traders worried about a winter fuel crunch due to thinning oil stockpiles and a North Sea storm. Investors bracing for more fallout from the U.S. subprime mortgage crisis and seeking shelter from the sliding U.S. dollar have driven oil nearly $30 higher since mid-August and lifted other commodities including gold, now at a 28-year high.

    U.S. light, sweet crude or December rose as much as $1.47
    to a new record of $98.17 a barrel.
    London Brent crude also hit a new peak of $94.74.

    Signs of thinning global oil stocks ahead of peak winter oil demand have added fuel to the rally, aiding a nearly 8 percent rise over the past two weeks alone, and prompting many analysts to say it’s only a short matter of time before oil hits $100. that, blaming the rally on speculators and politics. Analysts have also said that big options positions in the $90 to $100 range may also be forcing investors to cover short positions, contributing to the rise toward an all-time inflation-adjusted high of $101.70 during April 1980.

  332. Gold less than 10 usd off all time high as dollar sinks –
    Gold raced to a fresh 28-year high and is now less than 10 usd below its historic peak as the dollar sank against major currencies and as record oil prices stoked inflation jitters. The precious metal moves in the opposite direction to the dollar as gold is seen as an alternative asset and moves in line with high oil prices as investors hedge against energy-led inflation.

    The weak dollar, which hit yet another low against the euro, spurred buying as it made commodities denominated in the greenback cheaper for those trading in other currencies. At 9.24 am, spot gold was trading at 842.20 usd an ounce, against 809 usd in late New York trade on yesterday, having earlier hit 845.58 usd, its fresh peak in almost 30 years. Analysts are now calling for the metal to hit and even surpass 850 usd, the all time high set in January 1980.

  333. OOPs – I just forgot to change the date for Asia Markets info, the first of my posts this morning. Date should read : Asia Markets : Wednesday, November 7, 2007

  334. Alibaba down 17% to close at HK$32.60. Some of those speculators are back to their senses after a day of madness. But I guess some will argue that it’s healthy consolidation.