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Tuesday Morning

We're just waiting on the Fed.

I said to members yesterday that we should just sort of drift into tomorrow afternoon as we wait on the Fed, even though it is very doubtful they will do anything surprising, that's just the time the final cards are dealt and the big boys will start to push their chips around the table.  Until then it's a penny-ante game while we wait.

Another thing we wait for is oil to get real.  Just last night in chat, Xian pointed out yet another Bloomberg article pumping oil in what is becoming a concerning pattern for what used to be considered a reliably unbiased news service.  This latest load of BS is from Deutsche Bank's CHIEF energy economist Adam Sieminski (and I will now make sure we know who these people are and who they work for so you know where to move your money away from when they are spectacularly wrong) who wrote a report on the 25th that became news on the 28th because oil still needed a push.

Mr. Sieminski says "There is a huge risk that the oil price simply continues to escalate until it gets to some level ($200 a barrel?) when demand finally collapses because ordinary people can no longer afford to burn as much energy as they are burning now.''  Yes, that’s right, what happens in a demand curve is that people use the same amount at $80, $120, $140, $160 but at $200, THEN demand just suddenly collapses as people say "Hey, I can’t afford $200!"  I mean REALLY, that’s their CHIEF energy economist?  Oil prices are up 82% in 12 months, you don't think that is impacting demand already???

 

We talk about the PR activity of oil manipulators (hyenas) when they are trying to push prices over a critical level and let's take a look at these amazing coincidences in publishing that occurred last night:

Analysis: Sky is the limit for oil prices This is Money
No end in sight for costly oil bubble Times Online
Oil nears $120 a barrel, may reach $200—Deutsche Bank Manila Standard Today
Supply side to blame for high oil prices San Francisco Chronicle

It is almost as reliable as predicting a Nigerian Rebel attack when oil goes down to predict a slew of peak oil articles when they are trying to avoild putting in a double or triple top at a new breakout.  Kudos to the London Times, who hit the nail on the head with their headline: "Oil speculators push price to £5 gallon" in which Lehman Brothers joins me in estimating that fuel is 30% overpriced due entirely to an influx of speculators.  Lehman "believes that hot money accounts for between $20 to $30 of the recent increase in oil prices and that about $40 billion (£20 billion) has been invested in the sector so far this year — equal to all the money pumped into oil last year."

£5, by the way is about $10 per gallon – ready to change your behavior yet?  Europe has always paid more than us for fuel but imagine the change in your life if you had to fill up at $10 per gallon!  I defy you to find mention of Lehman's analysis in the US press though, the energy companies have already co-opted the US mainstream media.

In fact, the the on-line WSJ's top two headlines at 8:55 am is "Oil Prices Pump Up Shell, BP" and "Oil Nears $120 on Nigeria Unrest."  REALLY Rupert?  Still going with Nigeria 72 hours after the fact as your lead story?  This is obviously some version of "Fair and Balanced" in which balance is achieved by presenting just one side of a story until everyone starts believing your point of view – wouldn't it be terrible if the conservatives got a hold of a TV station and started doing this?  Perhaps Mr. Murdoch is simply running tomorrow's headline today since a pre-market drop in oil is sure to have some energy executive on the phone to Rent-A-Rebel this morning, ordering up some mayhem ahead of tomorrow's inventory report.

We are, of course, heavily short on oil as we called shenanigans early at $110 and pressed our bets on the way up but I've decided to point out how the news is being manipulated, hopefully to save some people from being victimized by the next bubble they try to stampede you into.  News just crossed the wire (9 am) that Bush is going to hold a news conference at 10:30, so I will issue both an oil reversal and market plunge alert ahead of his speech:

 

So nothing much matters until the Fed and I'll wrap this morning up quickly (make sure you check my massive earnings preview from last night) with a quick review (for me anyway) on the global markets:

Asia was mixed, India surprised us with a tightening of reserve requirements to reign in inflation so we need to watch our IBNs but I think they'll be OK.  Europe is dead flat and DB (the ones with the not too clever Chief Energy Economist) reported their first loss in 5 years including trading losses (probably in energy) of $3Bn and $5Bn in write-downs.  This was all in-line with very low expectations for DB.

In the US it's earnings, earnings, earnings but we also have data like Q1 foreclosure filings up 112% since last year while home prices are down 12.7% in the same period with 17 of 20 metro areas surveyed showing record declines.  MA and V had good earnings (and we have both!) but let's make sure we're covered as the Fed and other regulators are looking to pull the plug on this party.   MA is still in our safety zone and we're not going to adjust our butterfly there unless they break over $270, which I very much doubt.

Also, airline tickets are up 10.2% last month and the airlines are hoping to merge as quickly as possible so they can charge you MORE money.  The rush to merge is driven by the flight of the lame duck as it is very unlikely a Democratic President is going to greenlight the formation of an even bigger monopoly in yet another vital service industry.

Looks like an exciting day ahead!

 


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  1. OIL down 2.6$.


  2. MA monster beat on earnings. Phil where do you see MA going forward?


  3. Gas Demand
    Did you catch the commentary that demand was down 7% last month?  It was originally reported as down 2%.  Imagine where demand will be this month as prices have gone up .45 in the last two weeks.


  4. Phil – did we sell GRMN in the $25kp yesterday or was that only in the DTP?


  5. Beth – congrats on your big long in MA!  Hope that’s still going well for ya ;)


  6. POT - RBC Capital downgraded POT as they advise taking some profits… below 190 now pre market… let’s see how much it drops over the next few weeks (if it keeps going).  I’ll be watching for a push off the 50 dma since it should open below the 20 dma.


  7. 8:27 *IBM BOOSTS QUARTERLY DIVIDEND TO 50C-SHARE FROM 40C-SHARE


  8. DNA and BIIB – Gapped down on poor results on their Lupus drug


  9. I heard that demand story this morning on Gasoline, can anybody tell me WHERE it came from?


  10. MA – see above, regulatory issues will keep them from running away, they are very fairly priced at $260 and I think they’ll drift around $250.

    GRMN – we rolled to the $50s in the $25KP and we’re chancing it. 

    XOM with a big bounce off a low open, was hoping to cash out…  In DTP I want to get out of those $90 puts and also the SU $110 puts, now $2.75  so for sure by $2.50.  XOM puts have big earnings premium, not worth the risk, our other puts are covered and looking good.

    Gas demand, I head but could not find supporting link.

    Go Beth!


  11. Sox breakout .. uncover Semis INTC ???


  12. LOL – for some reason my OIH May $200 putter just shot up to $199,995, which gives me a loss of $1.599,964,010 on the 80 I sold.  Well, they’re coming to take me away now.. good knowing you guys…  8-)


  13. BNI – all out at $4.50 on the early spike.  Probably left some on the table for Buffet.


  14. MA
    Phil,
    If one did not enter either of the call or put spreads on MA yesterday, (at 2:52), any recommendations on an entry today at these levels?
    Thanks
    JB


  15. BNI – blew through R2, looks like I left A LOT on the table for Warren


  16. Phil – MA – be careful… I’d be surprised if we don’t see 265-270 today… all intraday ma’s point that way.Looks a lot like GOOG did on it’s earnings day.


  17. James – BNI!!!!!!!!!!  YOU DID VERY WELL MAN!  you holding or selling?  I have it "worth" $118


  18. CSX following suit.  YRCW still hanging…


  19. CVX going totally the other way, GS added them to buy list and they upgraded the whole integrated oil sector.  Interesting timing.

    XOM and CVX are a lot of the Dow so watch out if they reverse.  NYSE is down 27 so that’s about where the Dow should be without GS interfering.  

    BA still looking good.  YHOO still looking bad.


  20. Phil:
    what is your reasoning to have PUTS on XOM ?

    Hope the FED does not make another cut.
    Then oil will drop.
    The $ will improve,
    big money leave commodities and put it into stocks.


  21. James – BNI – I almost want to say sorry, but I can’t.  I love the transports sector (have been pounding the table on it for over a month now), but proper risk / portfolio management would have said to take some of that coin off the table.  You played it right, whether "right" was the most profitable.


  22. What’s up with the Agriculture selloff after ADM?
    MOS down almost $4 already.


  23. Gas Demand
    It was from the EIA…energy information administration…. http://www.eia.doe.gov


  24. the rebate checks must be working,  retail is up.


  25. EOG up. Phil my roll didn’t execute yesterday but that turned out to be good. Now my May 130 puts are 4.3 (yesterday 2.6). Should I get the hell out or still roll it to July puts?


  26. I mean EOG down – but puts up!!


  27. Uncover semis – no thanks.  Anything that happens ahead of the Fed is noise and now we have a fake rally by XOM (up 1%) and CVX (up 2%) punching up the Dow while the broader NYSE trades lower along with the RUT, this is nothing I want to uncover thanks. 

    What I’m watching carefully is if XOM starts catching up to CVX when they stop or if CVX stops and starts pulling back to XOM, very big difference…

    BIDU popping.  On the whole things do not look bad but I’m happy enough with our mix to mainly watch and wait.

    BNI – nice going James!

    MA/Mark – Other than selling the $270s for $6.15 (you can do it against the June $280s at $7.65) I would just stay away until the settle down.

    XOM/RMM – I had the puts because I firmly believe that earnings will show costs outstipping gains in revenues and paint a very obvious picture that this company can be cut in half with a 25% correction in oil. 

    Ag sell-off – This is what I keep telling all the POTheads, it’s a one-hit wonder and they can’t keep it up unless prices keep up which will collapse the global economy and screw them anyway.

    Thanks Fred!


  28. Ryan – I believe a lot of it has to do with what I posted earlier about RBC downgrading POT (which is just hanging out on it’s 20 dma like a champ!).  Need to see where that bad boy closes…


  29. 9:00 *U.S. APRIL CONSUMER CONFIDENCE FALLS TO 62.3 VS 65.9


  30. EOG – If you are even, best to get 1/2 out and keep a tight stop on the rest.  Bush speech in 40 mins is a real wild-card.

    Consumer confidence coming up.   Oops, here it is – 62.3, down from last month but BTE – so much for a real commodity sell-off.  March was 65.9 and we’re down 5% but somehow idiots are buying into this….  When things are good, numbers come in in the low 100s!


  31. Fred — Thanks, I walked in this morning and just heard it, but missed the source


  32. Europe paring losses too:    

    The Conference Board’s confidence index fell to 62.3, a
    smaller decline than forecast and the lowest since March 2003,
    from a revised 65.9 in March, the New York-based research group
    said today. A separate report showed property prices in February
    tumbled the most on record.


  33. I set a 10% trailing stop for AUO and got out out at .95 with a small loss. Anyone else still in?



  34. Phil:
    for USO: wait until Fed has shown their cards ?
    for my MAJune240: up 87 %,  after run up, sell may270/280 ???  what is settling down sign ?


  35. most sectors chilling but financials been selling off all morning practically… materials following suit


  36. SUN at 52-week lows so I’ll hang on to my XOM puts just a bit longer…

    They ran oil back up to $117 but hit a wall at $117.50 and now it’s pulling back a bit.  The low of the day was $116 and if we can get back into the $115s we may have something going.   If oil drops back to $110, XOM could have fantastic earnings and still take a hit but, earnings are Thursday so it would take one hell of an inventory build tomorrow.

    AUO – I’m still in, why get out?  GLW had great earnings and that’s our AUO premise (and they already posted great earnings last week so no danger ahead). 

    Wow, demand was off 7% in just one month?  That’s wild!


  37. energy just sold off big… there goes the market


  38. Phil:
    discipline for my MA:
    1) SELL 1/2
    2) trailing stop the others at  keeping 90 % of profits ?
    3) after settling down, sell may 270 for 6.6$

    Please comment


  39. Boeing
    Moving through the 100 DMA, see if they can hold and close here.


  40. Big Deal – Tax Rebates (sarcasm)
    Wow, what nice guys, Walmart is going to cash the government checks with zero risk for free.  These CNBC people are jerks.


  41. MA – I would sell the $230s, now $35 and buy more $260s to fill out the cover and wait fir a pullback to buy back the $240s if you can afford it.  Otherwise (and I eneded up witth 12 $230s, 10 $260s and sold 18 $240s) you want to roll all out to the July $260s, now $20 and just let the $240 caller cool down as you can always roll him to June.


  42. Mark – Don’t sweat the BNI stuff.  I still made >40% in less than a week and you and Phil are right about money management….and it looks like BNI is coming down so it was time to get out.  Now lets find something else to play!  In the transports and after the Fed does their thing.


  43. CRAP, once again forgot to get COF puts.  Perfect entry this morning at yesterday’s highs.


  44. AIG continues to drift down….at what price do people get interested in a new position?


  45. USO – let’s see what bush says.  Probably just going to crow about the stimulus checks and how it helped some old lady in Utah buy a tank of gas AND a pack of cigs.

    MA/RMM – not clear on what you have, please detail.

    I don’t know if I’d call government checks zero risk!  8-)

    AIG – I like them after a hurricane.


  46. Ryan, AUO – still in and looking to double down at .75.  SiO2 makes great things like GLW and WFR.  But then who can forget JDSU.


  47. gw coming up to kick the markets in gear !!!!


  48. PHIL:
    DISCIPLINE for RMM:
    have MAJune240, base 16.1, up over 80 %,
    1) SELL 1/2
    2) trailing stop the others at  keeping 90 % of profits ?
    3) after settling down, sell may 270 for 6.6$


  49. Hey Mark, where is the S&P going to bounce?


  50. Excellent post Phil


  51. cnbc saying gw is going to stay relevant in his talk. that would be a first for a long long time.


  52. XOM
    Rallies when Bush speaks.


  53. Anyone else having data issues today?  Tradestation won’t load some option graphs and they just posted a note saying data may be unavailable.  Just seeing if it was market wide.


  54. Was there any cover on AUO?


  55. Phil – Great comment on government checks!  LOL


  56. MA/RMM – Oh if you have just the $240s, get the hell out of them, they’ve done their job.  You want to roll to something much cheaper IF you want to stay in it, something just enought to let you sell max premiums like the Oct $250s at $37, which let you sell the $11.80 $260s ($6 in premium) which can be rolled to the June $260s or $270s for another $12 in premium, not bad for 2 of 5 months you have to sell.

    1M barrels a day adds 20% to the US’s 10Mbd production – That man is amazing!  This speech is all the same BS as that 2-year old link I put up in comments yesterday.  No mention at all of encouraging conservation – just use and spend, use and spend – it’s sick!


  57. G=Morning to all
    Film – Fidelity feeds are OK (so far)


  58. phil, what’s your take on adding NVDA for those who do not already have it


  59. AMR – sold 5 out of 20 Aug 7′s, sold 10 May 9′s to cover.


  60. FILM – sorry just got back on , got busy.  88 has been the spot teh past few days.  and there it goes… let’s see if that holds…


  61. FILM – I put a white horizontal line on 88 on this 5 day chart… you can see how the index has behaved around it the past 5 days.


  62. Film- OXPS working


  63. I wish one of these reporters would ask GW about continually filling the SPR.


  64. JOSB – Phil or anyone. Couldnt roll the May 25′s at the time where it was recommended. In at a cost of around $2, what’s the best way to salvage this position right now?


  65. SBUX sneaking up, maybe people can blow their rebate checks on a latte.

    CVX and XOM flying as Bush says NOTHING at all to ease oil prices.  265 Days, 13 hours 21 minutes still to go….

    AUO – no cover, will buy more lower.

    Massive flaw in Bush logic – Fill the 700M barrel SPR by buying oil from foreign governments but allow drilling in ANWAR, which is the last 5Bn gallons we haven’t sucked out of the ground in the US.  I’d be all for tapping it, setting up pipelines and NOT using it UNLESS there is an emergency but the last thing Bush wants is for a Democrat to take control of a 5Bn barrel SPR.


  66. Ok swing cover trading ..bought back May 22 sold @ 91 bought back @ 79 2/5 cover, and roll May 23 sold @ 41 to May 24 for .20 3/5 cover of few Jul 24 (bought 1/2 more @ .68, sold half yesterday @ 90) and the jan 08 22.5, hope to not regret ..


  67. NVDA – still cheap.

    JOSB/Dan – what do you have?


  68. Bush
    Sure, I’ll go buy tomatoes from the farm stand on the corner and that will solve world food prices….what a joker.


  69. just in case anyone cares .. I’m covered 1/ with May 24 .. always can cover yhe other half with May 23 if break down INTC


  70. Mark, the way I read your chart, odds are for failure.  You agree?  RSI falling, MACD new low.


  71. "corn fed ethanol"  LOL


  72. Maybe he’s been drinking today.


  73. Well, the market agreed with me.  I guess that is all that mattered.


  74. No mention at all of encouraging conservation – just use and spend, use and spend – it’s sick!
    Come on, Phil, this has been their position from the first days of their administration.  Cheney called conservation a personal moral decision, but not an element of national policy….you don’t think they’ll change now, do ya?

    -->


  75. MMM, MSFT   Anyone, Bueller?


  76. i just cant listen to Bush, he gives me a pit in my stomach, just wating for the next blunder.   my kids could do better.


  77. Speaking of Bush’s drinking, how can we put someone in the most powerful position in the world who cannot even control himself enough to toast with wine.  "If I toast with wine, I may become a raving alcoholic again."  I am all for AA, but not in a president.  What an ass.  Definitely Worst President Ever.


  78. yep. without peer…worst ever.


  79. MSFT down a bit.
    Phil how about picking some MSFT leap Jan 2010 $30 for 4 ($6 premium) for bread and butter sells against it?
    Sold 3 of my EOG puts for 5 (bought at 6.5). Holding 2 through earnings.


  80. FILM – sorry getting calls and crap.  yes agreed.  trend says down, so down is the momo.  88 is like a pivot point (in fact I need to look at the weeklys anyways).  It’s not support exactly, but it’s something it can trade around.  (look how price broke below and tested and back above on 04/25).  I’d be looking for an 80 test (low on 04/25) if it decides to see off that badly… but I feel like we’re close to "fading the gap" and maybe trying to get to 85 then seeing if we can settle down for a bit, come back a bit.  If that doesn’t make sense tell me, I’m not great at explaining this.


  81. lindsay
    That’s the encouraging message….anyone can be president.


  82. Al Queda blowing up your oil – This would be the "naked emotional appeals and more damned lies" part of the speech as outlined in the cartoon. 

    No, Eph, I don’t think they’ll change but I don’t know if I can take 265 more days of it!


  83. wow, W’s gettin testy when reporters are questioning his BS.    Way to finally show up to the game, guys!


  84. Bush looks like he’s gonna jump over his podium and tackle that reporter


  85. Seriously, he has no problem looking like a moron dancing with tribes, doing all manners of strange (to us) customs.  And when he goes to Paris, he toasts with wine.  Can’t stand that moron.


  86. ephmen, Are you also a member of CGI?


  87. serenity now


  88. I am with CGI…you wouldn’t be seabreeze would you?


  89. Mark, I think it is time you really look at where your loyalties lie.  Work or PSW.  PICK A SIDE!!!!

    Thanks, that all makes sense.


  90. Not seabreeze, I’m pmaggan on CGI.


  91. Film – this isn’t work?  Oh by work you mean you have to actually make money? :)


  92. fredrang -lol.  encouraging but not comforting.


  93. seabreeze gave a nice review of PSW over there and was one of the reasons I ponied up for a subscription …nice to see some cross-polination 
    (aside to Phil, ending the free stuff got me and probably others, you genius @#$&@*)


  94. Phil can take your money through the market or though marketing.  He is a true marketeer.


  95. Mark- anyone- Has anyone had experience using the "Renko" charts based on ATR now available on Stockcharts? Appears to show trend, support and resistance clearly. Anyone use them to trade?


  96. here we go


  97. seabreeze’s post was the reason I decided to take a look, but Film is the reason I stay around.  :)


  98. Ryan – to your ags selling off question earlier, here’s a better explaination then my lousy POT post…

    April 29 (Bloomberg) — Crude oil fell more than $2 a barrel
    after BP Plc restarted a North Sea oil pipeline and as the dollar
    strengthened, reducing the appeal of commodities to investors.


  99. he just said "make the tax cuts permanent" for the first time… that has to be a record of restraint for him


  100. Can you feel that?  Feels like the bottom wants to drop out.  Go ahead, I don’t mind.  A long we are in on Opt’s page is HANS.  It is working in this down market, about to break above resistance.  Playing it on a run to earnings which will be sometime next week (date not set).


  101. Prakash, I am blushing.  Unless that is the smiley we are using for the sarcasm font…


  102. Worst President Ever – I think you guys need to take a broader historical perspective as you may be selling Bush short.  History may well look back on him not as the worst President ever but possibly as the worst World leader ever.  Let’s not confine the measure of his ineptitude to just this country, where he clearly is without peer, I think Bush can take his place on the world stage as a person who has done more to set back his country than almost any person who has taken a seat of power in recorded history.  Only time will tell how long and deep the scars of this administration will run and when or IF we ever can recover our former glory so don’t be so quick to judge the man, as he likes to say, history will tell the tale…

    Oil back at $116.34.

    MSFT/Sumit – Only sell 1/2 covers until YHOO is resolved.  If they walk away they could get a nice pop.

    Gosh Bush is so jovial while the world is going to Hell in a handbasket!

    Bush "If there was a magic wand to wave Id be waving it."  After telling us that we MUST drill ANWR to get 1Mbd in 5 years (best case) why not release just 1Mb/week from the SPR (we have 700 week’s worth)?  Or AT LEAST stop buying 400Kb a week to fill it!

    LOL Eph – It’s still free if you wait 48 hours.  I just got sick of other writers stealing my stuff w’/no credit, that’s what tipped it for me.


  103. Film:

    any worry of the day ?

    have not seen a comment by you on APPL???

    what is your gold holding ? did you go in ? some weeks ago you were very worried.


  104. Phil,
     
    I also have a question about my JOSB position. I have
     
    - 7 JOSB May 22.5 @ 2.05
    10 JOSB June 22.5 @ 2.95
     
    Please let me know if I need to make any adjustments.


  105. A sarcasm icon…now there’s an idea.


  106. VLO
    1.  Stock buyback…still have $3.8 billion in repurchase authority, bought back $500 million in quarter.
    2.  Maya sour crude is a $23 discount to WTI.  Mars sour crude $10 discount to WTI.
    3.  April crack spread has doubled over March.
    4.  Diesel crack spread is $30/barrel vs $6/barrel for gas.
    5.  Divesting Aruba refinery in Q 2.  Selling two other refineries.


  107. JOSB/Phil – I have 10 JOSB May 25′s nekkid at a cost of $2.04.


  108. cbtc  where on stockcharts can i find the renko chart


  109. Phil:

    like you Bush evaluation:

    it is so true: that man has not only done great harm to the USA but to the whole world,

    Americans tend to only focus on the USA, that is wrong,
    too often I hear: we are the leader of the world, we are No.1, we are the best and on and on,
    NO: we are not the best in many important things and if we claim to be the leader of the world, we need to behave that way and its the President and governmant who needs to do it.

    Lets not forget: congress is almost as bad.


  110. ephman – where’s any of that been the last 7 years? I wanted just one damn reporter to stand up in 2002 and ask "Why are we REALLY going into Iraq?" Because, as a tax payer, I really did want to know.
    Apparently we cannot ask that question now because holding our civillian elected leaders responsible for anything is a pre-9/11 mentality.


  111. herb- Look under "chart attributes" then "type". Choose Renko. The default is ATR 14, but you can also choose points.


  112. FILM – some day ha!  Would love to kill you guys with my spam (means I’m able to make enough money in my own account vs working for the man).  I say that even though I pretty much have the most fun job I can think of, and love coming to work each morning. 

    CBTC – never used ATR (at least not to my knowledge, i.e. I might use something similar with my own eyesight or pivots).  If you end up using it for a few months religiously tell me how you like it.  Always willing to try out new things.


  113. Hmmm let me see,

    JOHNSON – biggest crook ever in the presidency
    CARTER – toatl moron decimated our military in shortest period ever, total embarrassment with 400 hostages for over a year in Iran
    Clinton – icant even begin with all the scandals mysterious deaths and 8 trillion of wealth disappearing, and the release of Osama

    These are the 3 top worst Presidents ever in the history of US

    WHEW hell yeh


  114. RMM, got into DZZ at 29, that is going well.  That is my main Fed play as they couldn’t really do anything to make gold fly but could bring it down fast.

    AAPL I am in almost fully in my LTP’s.  Waiting until post-Fed, hoping for a return to 165 or 155 if there is a trading god who likes me.  Then I will load up on May/Jun.


  115. cbtc thank you looks interesting will be playing with it


  116. You know what I want to see?  A free for all pundit smackdown:  Phil, Olberman, and Jon Steward vs  Bill O, Rush, and Sean Hannity.  Biting reality-based sarcasm from the left vs. blathering faux-patriotism from the right.  It would be glorious to behold.


  117. Phil,
    your idea to drill & cap for later use is great! we must find a way to get this up to the controlling dems in congress. espc the house.


  118. rebelatl, what 8 trillion are you talking about?  The only 8 trillion I am aware of is the 8 trillion in debt this country is in courtesy of GW.


  119. V – holy IV. Singapore Steve was right on about the Volatility factor & V earnings:
    Friday V @ 77, sell may70 puts @ 2
    Monday V @ 77, repo may 70 puts @ 1.45 – nice huh? But if I had waited until…
    Tuesday V @ 75, may 70 puts @ 0.80


  120. Lou Dobbs for President!!!


  121. ff,
    your negative aapl gods would be demons to many of other members aapl positions. lol. we will continue to petition the more favorable gods.


  122. VLO
    Contrast to Bush…Valero selling refineries and talking about finding ways to utilize spare capacity profitably.


  123. The 8 trillion that people lost in the stock market under Clinton during the internet bubble burst.


  124. aapl finally breaking r1


  125. btw aapl r2 is @  $176.33


  126. CTRP – FYI earnings May14. Another rice-rocket. Typically gives very low guidance.


  127. FRED- Thanks for the VLO update.  They have been talking getting rid of the Aruba for a while. 
    Tough game last  night.


  128. rebelatl – WTF?!  Are you serious?!  You BELIEVE that Clinton was the reason for the internet bubble?!?!?!  I’m sorry, I’m not one to get into political debates on this blog, but that seriously is the most ignorant thing I’ve ever read.  You can slam me all you want, I’m not going to say anything more about it. 

    FILM – looks like 88 held well… on the intraday now spx taking back 89 ema and already back above S2… faster ma’s already upward sloping, let’s see if we get a nice 200 ema test around 1391-92ish…


  129. Mark – thanks for the Ag research.

    Back into AUO at .9 for 10 contracts.


  130. once aapl hits 180 it should stay level for few days untill moving on upwards to 200 range if tea cup pattern holds and so far it has been pretty much on the mark !


  131. rebelatl, you crack me up.  

    Highlander, I don’t want it to stay down there, just hang out for about 3 minutes, then it can continue to climb.  You have got to have some cash lying around to buy more if it pulls back, right?


  132. Mark – what’s your thoughts on TRN?  These rails need cars don’t they?


  133. Getting a nice pullback on GRMN.

    BZH holding on well.  HOV good too. 

    JOSB/Emo – It will cost you nothing to roll your 10 June $22.50s to 14 $25s and roll your caller up to 14 $25s, putting him all in premium.  You’ll be all in premium too but you should hold 2/3 of yours ($1.80) as his expires leaving you with a clean $2,500 vs the $1,515 spread you currently have (assuming JOSB stays flattish but up, of couse, is good too).

    Not too bad, so far but Bush effect sometimes takes a while to kick in.

    VLO – right about what we expected.  I was hoping they’d go lower so I could buy them but I’m not happy about them selling refineries since they aren’t buildning any new ones.

    JOSB/Dan – Well there is still hope but you are only down .60 so you could roll back to the June $25s for + $1.20 and recover 1/2 of that by selling 1/2 the May $25s (you can sell another 1/2 if we don’t break $25 after the Fed).  That gets your lost .60 back and gives you more time to be right.

    Please save this fascinating conversation about Bush Carter and Clinton for after hours, thank you.  Make sure Rebel is back on his meds before you start though…

    Reb – Clinton took office in Jan 1993 and the Dow was at 3,310, up from 3,232 the January before.  When Clinton turned things over to Bush in Jan 2001, the Dow was at 10,850, up from 10,738 the year before.  Bush’s tax cuts, especially the dividend tax cut, encouraged people to take money out of the markets and by September 4th 2001, they were already down to 9,600.  By Jan 2002, we had recovered to 9,900 despite 9/11 so don’t blame the terrorists for the subsequent drop to 7,500 in Oct 2002.  So any $8Bn you may have lost can only be blamed on your pal Bush, not Clinton, who oversaw the largest expansion of personal wealth in the history of our country.  Wealth that was transferred in the Trillions to the top 1/10th of 1% of the people in this country over the next 7 years.


  134. V  – trying to make a run


  135. ff,
    oh ya! but it seems that some of us might have more unutilized aapl cash than others! you might consider averaging back in. it could always down spike but at this point it is probably more likely to hit $180 than $155. other than the crazy dip, aapl has had $155 in the rear view since the beginning of nov ’07.


  136. Phil:
    assuming V and MA will do well as within the next 6-12 months economy should stabilize and actually improve: so, I am bullish on these 2.
    Now: how to deal with my V situation, this will be another check to see whether I reason the correct way:
    have 100 shares V, base 44$,
    have V sep62.5 base 10.4, now 13.3, also 1/2 cover with may 72.5 base 2.05, now 4.6 this one is ITM with stock at 76+,
    my plan:
    roll up sep62.5 to sep67.5,
    short option: switch from may72.5 to may75 or even to jun75,
    makes sense ??


  137. I have the dollar down against the yen by about 75 basis points, and the commodities, interestingly enough, are still acting quite weak (over 2% down in Crude and Gold, 1% in copper, 3.5% in natty gas, 3% in silver).
    Should be a very interesting Fed meeting. Gold is threatening to confirm a head and shoulders if we fail here, and the DBA likewise is near an important support level.


  138. Phil,

    What about the Applefly? This is a highflyer, or do you think we see it flatening to 170? The caller gaining speed and the premium getting lower.

    Thanks


  139. Highlander, that is precisely why I am almost fully invested in my LTP.  I do think 180 will prove to be large resistance, and if commodities collapse, people will sell "what they can."  So, I am not aggressively buying any calls really.


  140. VLO- That Aruba place has been trouble since day one.


  141. Hi Phil,
    Have a quick question for you.  I have some
    2009 AAPL January 200′s with a basis around 14. 
    Currently,
    220′s are around 12,
    230′s are trading at around 10
    240′s at around 8. 
    Now I know you’re not a fan of verticals, but I will still ask :)   Is it worth selling 220/230/240 against my 200′s to pay off most of them, or should I just sell some front month calls for the next 6 months.

    Thanks


  142. Phil – I don’t understand why lowering the tax on dividends caused people to take money
    out of the markets.  Didn’t you mean lowering the cap gains rate?  Lower tax on dividends
    makes stocks more attractive vis-a-vis other investments increasing stock ownership.


  143. And I show 160 as the support level if we tank tomorrow.  I will be doing all my buying by the time we get there, at 155, I have to get the instant mortgage .


  144. Speaking of reasons to subscribe to PSW, I joined as an undercover narc.  I report the Bush bashers to a secret government agency that monitors seditious options traders and they are preparing a secret government holding facility under a manhole cover near where ever you live.  LOL
    BillBigD – you are safe, since you didn’t actually go to your friend’s Clinton fundraiser.  ;-)


  145. BBD,

    Do you follow NE (the drilling co.)? They report nearly $5 bn order backlog, nice contract deals with Petrobas, and beat estimates last week.
    I’m tempted to buy a little today on the pullback.


  146. ff,
    so you are really praying for a drop in commodities w/ a resultant market reaction to sell the most profitable positions (sic aapl) from portfolios? what other stocks would you place in aapl’s category?.


  147. Dividend tax cut was in 2003, so how could it have any effect on a 2002 market?


  148. Wow – V holding the upper BB and at R1


  149. Anyone,
    I missed the AUO trade.  Can someone update me?  I went to the protfolio tab and searched thru’ and I couldn’t find it.  I’d appreciate if anyone can update me on the AUO trade.
    Thanks.


  150. James – TRN – frankly don’t know anything about the company (story, contracts, etc).  The theme that they "need cars" makes sense to me, but I beleive cib69tc (the trucking company owner on here is that his moniker?) would have more of a clue than I. 

    Technically it’s "getting better".  I always start with a 2 year chart.  You can say it’s made an inverted H&S over the past 6 months on a weekly, and now testing its 200 dma today (right on it before earnings).  IF it does report well and great expectations for the future, it should see 40 again the next 2 months.  All that said I plugged it into my fundie spreadsheet and it said it’s "worth" $30 (i.e. fairly valued here).


  151. V – (SO FAR) is a great company like MA.  and big boys love big names.


  152. ff,
    BTW most buyers of aapl after Oct ’07 thru mid Jan ’08 are probably still in the red so they will not be selling in a commodities blow off.


  153. greg,
    speaking of gov’t agencies, who says ‘the company’ is even on gw’s side? lots of bad feelings there!!


  154. speaking of MA it kissed 269.93.  FYI, for anyone who might be interested, whenever you see this price structure you should know it’ll keep going up intraday. 

    The pattern is basically a huge gap up on volume in the morning, all intraday MA’s shooting up since the open (and needing to catch up to the price), AND price is WAY above / below the day’s calculated pivot points off of yesterday’s info.  SBUX was a great example of the inverse of V or GOOG post earnings. So almost ALWAYS you wait for the 8 min ema to catch the price then that’s your buy/sell point (depending on which way MA’s are going).  That’s why I cautined Phil earlier about MA getting to 265-270 pretty easily (and I wish I’d been around GOOG day was busy… could have had those long the 500′s stay on a bit to make some extra coin).  

    Anyways, very important day trading stuff… make sure to note.  MA’s eventually catch up around lunch time and that’s when you know you’re near a top (well, depending on the velocity of the ma’s and price at the time)…


  155. HL, AAPL and GOOG are the only things I want to own long-term, no matter what.  Everything else looks risky to me.  When you have a total market collapse and funds need to raise funds, they "sell what they can" as the old adage goes.  That is not my primary investing premise but for AAPL right now I see 180 to 160 as the "value" range.  I last bought at 166.  I will start buying at 166 and will probably do some ST put plays if we jump to 180.


  156. Hey – After yesterday’s 3% and 6% drop for CF and POT (respectively) and today’s 6.0 and 5.3% drops can I now say they are getting "killed" ?  :-)


  157. Phil:

    BIDU and GOOG:

    you have spoken about some "interaction" between these 2,

    what is it, how do they respond when one drops/rises etc??

    Please explain.


  158. Good commentary on the ANWR farce:  http://www.alternet.org/columnists/story/21455/  also, down memory lane, here was the ANWR discussion in 2002, when Bush still had the house and the senate:  http://alternet.org/columnists/story/12842/

    Let’s keep in mind that 16M new cars are sold each year in this country.  Raising the average US mileage requirement from 20 to 25 mpg on next year’s fleet with an average of 15,000 miles per year per car (national average) would be 240Bn miles or 12Bn gallons ( ) at 20mpg and 9.6Bn gallons at 25mpg.  So that’s 2.4Bn gallons of gas saved in the first year of raising mileage requirements at 42 gallons a barrel that’s 57M barrels or 1Mb/week in the first year of mileage improvement.  We continue to save that 1Mb/week and save an additional 1/Mb week each year for the 7 years it takes the fleet to roll over EVEN IF WE ONLY RAISE THE REQUIREMENT TO 25 mpg.

    So let’s not pretend this jackass has any interest whatsoever in doing anything constructive for this country.  They can’t make money by having you consume less, pure and simple so it’s not a solution that’s even on the table!  Europe has a 35 mpg fleet requirement and do you know who is Europe’s number 1 seller of cars?  GM!!!  That’s right, the same guys who can’t compete here are able to outsell rivals in Europe with a fleet of vehicles that averages 75% better milage than the cars they sell in the US.  Yeah, you get me on that talk show – I’ll murderize the bums!

    Oil down to $116 but that’s only 2%, gold is down 3% for the day!

    V/RMM – As long as you can afford to roll your caller into May premium, do so – the June premiums will always be there.

    Applefly – like everything else, we have to wait for the Fed.

    AAPL/Yev – You take the Jan $200s at $17 and roll them to the Jan $180s at $24 and sell the June $180s for $8 – THAT’S a spread.  A vertical of the $220s/$230s/$240s is like playing darts from the other side of the football field.

    Dividend Tax – Oh yes, I meant cap gains, lowering the dividend tax only allowed cash rich corporations who’s stock was concentrated into the hands of wealthy shareholders to declare .20 dividends that gave the average 100-share holder $2 but gave the 10M share-holder board member $2M of the money that all the widows and orphans had patiently watched the company stockpile over the years they held it, expecting many years of future growth but, hey, they got their $2!  Of course the wealthy shareholders were smart enough to dump their now cash-poor holdings while the widows and orphans were the ones holding the bag as the market gave up 30% of it’s value in an orgy of cash outs that tripled the nation’s number of $10M+ families between 2001 and 2003 while the market bottomed out.

    Bring it on Greg – I hear I will be greeted under that manhole as a liberator!  8-)

    Come on XOM, give it up, you know you want to…

    AUO – the June $20s, now .80 (was $1.20).  I’m tempted to DD here but not with the bad market.

    1 in 84 US households got a foreclosure notice last year?  That’s amazing!  And foreclosuers are up 112% over last April so we’ve gotta be getting near 1/50 at this point.  Another reason I’m not rushing to reposition my callers into more bullish positions…


  159. Bush not world’s worst leader:  there was another guy, I forget his name, who suspended the Geneva Conventions because he was fighting the Communists, and not an army.  So, you see, things like this have been done before.


  160. Highlander – I’m not talking about "The Company", most of those guys don’t even know the secret handshake.  Believe me, this goes much deeper then just the US Government, this is international and nonpartisan.  Think Skull & Bones Club, Bilderberg Group, Trilateral Commission.  Christ, think Free Masons & Knights Templar.
    By the way, Bill & Hill may be members as well, so watch out Obama, because it is all coming together.


  161. PS – I think Phil knows the secret handshake, and he is just bashing Bush as part of his deep cover.


  162. ISRG   I know you’ve been chillin’ and in no rush to sell a caller, but this is the first time I’ve legged into a spread and I want to be sure that I sell May premium.   The stock was 275 when I bought the Jan ’09 240.   It’s a week later and the stock has moved up 12 points.  The 310s are trading for $4 ($23 in premium) and seem reasonable.   Would you still wait, and if so, do you have any rule-of-thumb guidance of when to sell your caller in this type of trade.


  163. Goldman Sachs
    They said that the relationship between the dollar and commodities has changed so don’t expect a big drop in commodities when the dollar strengthens.  Can you believe that?  I guess that’s a sign they are on the wrong side of this trade.  That’s like saying the law of physics has changed…gravity no longer exists as declared by the almighty Goldman Sachs.


  164. FILM – SPX testing 200 min ema now at 1391… damn it feels good to be a gangsta…


  165. JOSB – Phil I have the same June / May 22.5 spread going on.  I had thought that was the 25K position, but somewhere you rolled to the Octobers.  Anyhow would you recommend the moving to 14/14 on the 25′s or would you just roll the june 22.5 to october to mirror the 25K position?
    Thanks!


  166. fredrang, that goes along with their decree that profit and lying recently decoupled.


  167. Phil, I think you missed what I was saying.  I was giving you current prices for 220/230/240.
    What I thought of doing was keeping the 200′s and selling either 220′s, 230′s, or 240′s against the 200′s.  So as an example 230′s are going for 10, so by selling those, I would pay for some of my 200′s, so my 200′s will cost me $4 instead of $14.  I don’t mind riding those, but can use the funds to get into a "real" spread.
    Thanks !


  168. Mark, you are one bad, MF.


  169. Phil:

    Well I must say that I often don’t have time to fully utilize this site for the option trading as much as I’d like as I’m often too busy watching other markets, but it’s well worth the subscription just to read your take on the Bush rhetoric and how he seems cause an immediate gag reflex when he opens his mouth.  It’s nice to know you can count on something during the trading day and a few laughs never lost anyone money, at least not yet.


  170. by the way is there a trade on BWLD earnings?


  171. FF – ha!  naw son, it just is what it is.  Like reading a book.  But yeah, I am.  8)


  172. fredrang – how could GS be on the wrong side of the trade when they have Paulson calling in the plays ahead of the Fed?  What did Hank forget to call this time?


  173. BIDU/GOOG – What’s to say, they provide similar services and move together.  GOOG leads BIDU as we rarely get news from BIDU so it simply follows GOOG around for the most part (once they settle in after earnings reports).

    What army is Bush fighting Occam?   Seems like just another thing ending in "ists," it’s the unseen enemy that is necessary to excuse all actions by waging and endless war and depriving people’s liberties "for their own good."  If you haven’t read 1984 at least rent the movie…

    Hey, this country was founded by people who knew the secret handshake.  We even have masonic symbols on our money, which was a way of letting club members in foreign countries know they could trust our paper.  Do you know what "Nuvus Ordo Seclorum" means under the pyramid on the dollar bill?  New World Order, that was the same message that was being sent by the 50 (out of 55) Freemasons at the Constitutional Convention of 1776.  So don’t dis the handshake – that’s what this country is based on!

    ISRG – I’m NOT selling Mays until next week.  I’m hoping to sell the $310s for $10+.  They are strong today and not alarming me.

    $115.16!

    GS – yeah, "This time it’s different."  Man, speaking of people who know the secret handshake!


  174. Sweet video Mark


  175. They are already planning on drilling ANWR via Pt. Thompson. Directional drilling makes getting the physical lease in ANWR nearly moot. Unless the Feds want Alaska to ‘drink their milkshake’ they had better open it up over the next 10 years.
    http://www.adn.com/money/story/389829.html
    http://www.dog.dnr.state.ak.us/oil/products/slideshows/stratigraphic/alaska_stratigraphic_test_well.pdf


  176. Why can’t XOM die?  Crude is down over three dollars. ARGH!


  177. All banks – waiting for fed tomorrow.  GS just hanging out below it’s 200 dma.  GS also tested it’s S2 and 5 DMA at the same time.  Very small volume buying it on it’s way up… along with every other security out there I suppose.


  178. Does anyone know if there is an inverse equivlient to ERO  or FXE. Looking for a way to short the EURO via an ETF if possible?


  179. and a ‘lion’s paw’ to all you secret handshake guys !


  180. Yev – it’s the same thing, why lock your position by selling calls in the same month and waiting until January to get paid when you can simply sell premium now.  June gives you $8 and it’s notr even an earnings month, another $8 and another $8 and another $8 against your current $17 position still leaves you 3 months of cushion.  This is my answer, NO, NO and NO, I do not like selling any January position against your January position that is worthless unless Apple gains over 20%.  I don’t like far out of the money calls and I don’t like verticals, that is my answer.

    JOSB/Bigs  - I think it’s worth the extra money to roll to October but at $25 I would fully cover with May, notice how the 3/4 cover at the lower strike saved the $25KP from disaster on that one but now that we are in the money our focus shifts to selling premium and more protection.

    Thanks Joe!  We try to keep the politics out of the workweek but that Bush keeps stirring things up by coming on TV!

    BWLD – All potential earnings plays are in last night’s post:  http://www.philstockworld.com/newsletters/members/2008/04/28/monday-mop-up-69/

    MA higher and higher!  X coming back.


  181. How about some DBA puts – Jul $35s at 1.90
    Theme: Dollar up, crude down, ags down, slight correction in large cap internationals padding earnings with inflated Euros = flight of speculative investment from crude and ag stocks as sector rotation into tech and financials?


  182. MA – like I showed earlier in intraday trading, will get highs at lunch, then needs "velocity" (see the volume increase). 

    Also note it tests fastest first (8) then 34, then 89… all SUPPORT it… very strong.  Volume gives it the umph it needs.

    yopauly – ha no doubt brutha.  Used to be all up in that back in the 90′s.  Ahh the pimply teenage years… how I don’t miss thee…


  183. Got it !!!


  184. boy,
    aapl hugging r1, just doesn’t want to break away!


  185. I’m short an MA 260/270 call vertical (there’s a bad place to be), should I make an adjustment here, or just sit tight and wait for things to settle down?


  186. I decided XOM will hit $91.50 by tomorrow so that’s my exit.

    YHOO coming back a bit, I still think a deal gets done so the June $27.50s at $1.92 could double up on a $31 sale and should hold a reasonable amount of value for a month (the May $27.50s are $1) so you are risking perhaps $1 if you give it a month.  XXX

    DBA puts – Where were you when I called those a month ago in the $40s?  I think my they are actaully front-running a drop in the CRB now but amost certainly will test $34 as long as the Fed doesn’t go over .25.

    MA – It’s analyst roulette after an earnings like that but I see serious issues with the rise in bankruptcies and regulation noises as well as the decline in oil, which is the thing that, along with food, is fueling record CC usage.  Of course, those are all forward looking and people may not see it that way in time for it to help.  Still let’s wait until after the Fed and then see where things stand.


  187. Hey Phil
    New member, been a little shy about posting but would like to know your thoughts on AMZN. Thinking its a good short candidate.


  188. Well now that we’ve done politics for the day, how about this to get the blood flowing again?

    Archer Daniels Midland stands by ethanol from Marketwatch


  189. Ryan / DBA: Be careful with DBA, it’s planting season now – so it moves more in response to the bean/corn/sugar/wheat prices and weather than the ag sector companies.  Off season, DBA tracks closer to POT/MOS/AGU/MON and the rest.  Not saying your premise is wrong just something else to consider.


  190. stevep6: You’d be standing by ethanol too if your profits were up as much as ADM’s as well as having the government subsidize a good portion of your business risk.


  191. DBA- Farmer Buddy in IOWA still has not been able to plant any corn due to weather. FYI


  192. DBA -
    OK, OK, i got it. I am late.
    Better me than my girlfriend ;-)


  193. PHIL – Do you think that the Ag selloff will continue regardless of the Fed’s announcement tomorrow?  I ask because I am considering getting out of my Ag May Put positions before EOD to protect gains so far.


  194. Sox green..


  195. BBD, how many Ag/Oil buddies do you have?  LOL…  Hopefully phx can pull out a miracle tonight, but i doubt it.  Duncan and Parker will score 70 together, unfortunately


  196. I’ll be off next month for my foodie tour of Europe.  Can’t wait.  I’ve retired my 30kp and have folded that into my LTP.
    Phil — I noticed the drubbing gold and silver stocks have taken.  I don’t have any precious metals in my LTP.  You think there’s a play in NEM, ABX, or SLW here?  Or you think they’ve got a ways to fall?  Sorry, I just can’t believe the dollar will strengthen much.


  197. orion: hey, it’s a great gig if you can get it!  :)

    Actually, it’s not really funny at all. It does seem to me that more people are becoming aware of the issue as I’m starting to see more anti-ethanol quotes and articles in the media.


  198. MA   Prior to PSW, I mainly sold naked puts and vertical calls.    I’m in the process of rationalizing things, but it’ll take some time.   My MA position currently has 2 short May260/270 Call as well as 5 short puts in Oct which are well OTM (2 120s, 2 135s, and 1 150).   How about this adjustment, I sell my May 270 Call that I’m long, and roll the short May 260 Call --> Oct 290.  Although I’m naked in the 2 290 calls, it’s offset by the 5 naked puts.   That trade will bring in about $3400 in cash and rather than selling $4 in premium because of the ITM 260s, I’m selling $37 in premium on the OTM 280s.


  199. Beth, did you think the dollar would fall this far 5 years ago?


  200. I mean OTM 290s


  201. AAPL breaking 175 on big volume, volume neeeds to keep.  R2 at 176.30ish, then 178 next big number


  202. Phil
    Got  4 AAPL Jan10 140′s covered by 2 May 155′s and 1 May 170.
    Stand pat for now and re-evaluate past Fed/economic indicators?


  203. HUGE order just crossed on the SPY’s.


  204. Film — I knew the Euro would overtake the USD, but not Canadian.


  205. Re SPYs, check Level 2, that size is still out there. Some FNG at Fidelity accidentally putting in market orders?


  206. jomama- Only one farmer buddy but really he is a really great investor.  Was Bill Oneils from IBD roommate at SMU and still lives in Dallas
     Oil friends- with pricing over $60 they  all came out of the closet.
    Hoops- goodluck, my Lakers closed it out and kobe was very hot in the 4th


  207. AAPL – no volume to keep it up.  let’s see if it can regain it’s mojo or if 174 is back in style.


  208. Beth – congrats on MA again.  You taking any profits up here?


  209. SPY size gone. looks to just have been a massive matched trade.


  210. WFR looking at a nice breakout if they can hit $69.

    TASR – I have Sept $7.50s naked so I’m layering a Dec/June $7.50 spread for $1 net around it.  That is effectively 1/2 covering my total postion.  XXX

    Welcome DrLuong!  AMZN – no shorts!  They are not even a retail company anymore, they are providing back-end warehousing for other businesses – huge deal.  Also their Kindle bookreader is going to go into mass production and has the potential to put up IPod-like numbers in V.2 and THEN I would short them ahead of Apples IBook announcement.

    Speaking of AAPL, I just picked up some July $175s in preparation for rolling my lower Apple callers up to 2x.  I think in the $10KP, $25KP and DTP, it is worth waiting for the Fed as we sold the $170s and they have plenty of premium but in Complex Spreads, I’m not looking to roll my 100 Jan $140s to 2x anything so I’m going to lighten up and roll them higher and take 50 July $175s in preparation for a 2x roll to steal the premium from my callers if we go up.  If we go down, I have $4 per contract of protection and I can always cover more.  XXX


  211. billbigd,

    Any opinion on NE? I’m tempted with the price pullback.


  212. Phil,
    I’m long BWLD, what would be the best play to protect my gains?
    Thanks
    Daya


  213. ERIC- Hoping RIG gets to $145 today or manana.  But nibbled on very few already


  214. Mark — Thx.  I went in with a 1/2 cover and bought him out and sold 1/2 my Octs this morning.  I’ll be out of the rest by the close.  Since I’m closing down my 30kp, I don’t see anything good to roll to to put it in my LTP.


  215. Looking to put a significant portion of short-term savings into "safe" stocks.  As Phil and others have stated it certainly doesn’t pay to let it sit in MMA with rates below 3% and rising inflation.  I’m looking for some input but I may buy some real estate in 5-6 months so I’m not looking to hit a home run just want to park it somewhere to collect some market returns.  I was looking at parking some in MSFT and PM?  Thoughts from the gallery?


  216. Forgot:

    what is 2x ? when Phil comments ?

    please remind me.

    Txs


  217. AUO June 20s are 0.75


  218. crisz…. I like timber at these prices for a safe stock.  PCL and RYN both yield over 4% and the great things about the industry is if pricing is weak they just let the trees grow.  When eventually harvested, larger trees command premium prices.  Also, both stocks have options, so you can sell covered calls to get a little more return.


  219. Ag sell-off – Yes, I wrote an article on $200 oil last month where I did the math and there simply isn’t enough money in the world for people to pay these commoditiy prices (and that was with oil at $100).  Commodities are up on some kind of fantasy that demand is inelastic and rising but the reality is demand is rapidly being destoyed (US gas consumption off 7% in 30 days) and money is tighening up so people can’t even borrow anymore to pay the prices they’ve been stretching to pay so far.  This is how deflation starts and we’re not there yet but if the economy is worse than a mild recession, we’ll get there soon.

    Metals/Beth – I’m waiting.  I like NEM but the market doesn’t so I’m just rolling my position down but that’s the only metal I have left (other than a short on X which is really just an income producer).  Have a great time in Europe!

    Oil holding right at the 2.5% rule at $115.80, if they finish below $116 its going to be bearish into tomorrow.  Gold getting weaker so the oil pump we’re in right now (up .60 since 1pm) is probably just BS but watch $116 ($93.50 on USO). 

    MA/Eph – Man that gives me a headache!  So let me get this straight:  You sold a May $260 ($19.60) and $270 ($12.75) and sold 5 Oct puts which are so far out of the mney I can’t imagine why you keep them open.  But then you talk about selling them so are you long or short or what?  Try retyping it like:
    -1 May $260
    -1 May $270
    +1 May $290…

    LOL – Guy on CNBC "Buying oil from abroad is like smoking dollar bills."  That is very true!


  220. Phil:

    with V and MA that high:
    I sold my V stock with 76 % profit,
    sold sep62.5call with 67% profit,

    and now, its going up more, so I plan to sell may80 for $1.60,
    later if/when V retreats, I buy sep67.5.
    I go for 1/2 cover


  221. RMM 2x rolling them to 2x the contracts not dollar amount. Hope I’m right. RMM you’re puzzling, how do you expect to be trading if this stuff isn’t second nature.


  222. Thanks BBD. I’m going to wait for now.


  223. Phil;

    MA,
    sold 1/2 of my jun240 calls for 137 % profit,
    it is still going higher,
    sit ready to sell may280 for 4.4$.


  224. Why was Bush so defensive all of a sudden? Up to now, it’s been "everything’s fine, no recession, mild slowdown", blah blah.

    Hypothesis: he was told something. Something bad. Like maybe a GDP number that’s NOT the +.3 or .4% for the quarter.


  225. BWLD last night I said:   "BWLD – I wish we had bought these guys at $20, now at $26 they seem expensive but they are a 20% grower with a forward p/e of 16, exactly the thing you do want to own in this environment.  Maybe if they miss, we could pick some up but the Sept $30s at $2 are a fun gamble with 29% of the float shorted in a thinly traded stock. "  So the best play to protect gains is to roll to those if you are bullish, taking most off the table, or Selling the May $25s at $1.75 to cover if you are worried about your longs (not for selling against the Septs except as a 2/3 sell if you really are comfortable rolling).

    LOL Crisz – there is no such thing a a safe short-term play.  We could have a 9/11 any day and where would you be?  I’d be happy to talk about it after hours but you need to diversify and selling covers would be much smarter than just going to bed every night and hoping nothing blows up.


  226. Eric – gawsh thanks for reminding me!  WEd is A HUGE day for eco.  Fed, GDP, inventories, farm prices, chicago pmi, ECI, and BOJ Meeting (last one is a "whatever").  But damn big day tomorrow… hence why volume’s non existant today…


  227. alf:

    txs for explanation, I thought that was the case,
    you hope you are right, so you are not as sure, very encouraging,
    you really give me confidence.


  228. YHOO – moving … the announcement from MSFT coming soon? Somebody knows something!


  229. Phil
    I cashed out all my naked 2010 $150 AAPL calls when apple reached 170 ( the calls were naked going throuh the earning ) thinking the 170 will stop the advance. When will be a good time to open new positions and what strikes would be best to generate income. Thanks.


  230. Sorry Phil…my MA debacle looks like this (just looking at the months of my idea, believe it or not I’ve got other crap as well)
    Current Position:

    1. -2 May 260 Call  
    2. +2 May 270 Call
    3. -2 Oct 120 Put
    4. -2 Oct 135 Put
    5. -1 Oct 150 Put

    Suggested Trade:

    1. Roll the May caller --> Oct 290 for 4.25 credit ($850 in cash)
    2. Sell my May calls for 13.40 credit ($2680 in cash)

    Rationale:

    1. I’d bank $3500 in cash
    2. The premium sold on my callers goes from $4 --> $47
    3. Although I’m naked on the 290 callers, the puts offset the risk a bit (it’s a wide strangle)
    • Leave the October caller naked, 5 puts offset partially

  231. Flim:

    looks to me that AAPL is going to 180, IF tomorrow the market does not react negatively to Bernanke.

    IMHO


  232. sorry that went so wide, I tried the list button and it added all that space


  233. Phil – What’s the ratio/formula you use to connect USO and Oil $/BBL?


  234. Phil,
    The Democratic led Congress hasn’t done much better…Correct me if I am wrong, but since that Congress took over the price of oil has gone up more than the previous 6 years under Bush. I am going from memory here, but the price of oil in 2000 was around 30 bucks a barrel, went to 60 in 2005, and since the Dem’s took over it’s gone from 60 to 120.
    I’m not particularly happy with Bush (very disappointed), but this entire country lacks leadership across the board.


  235. MA – anyone like may250 puts @1.60?

    Mark – love the info on the intraday 8 min ema! Awesome.


  236. FYI – tonight PNRA, ESRX, ACE, and FLEX.  Only major ones reporting tonight I think.  Tommorow brings IP, NOV, GRMN, TWX, CEG, IR, KFT, GM, PG, and FSLR before market (before GDP AND FED!).  Then IRBT, LVS (?), and a few others but nothing as big as that mornings eanings, eco, and fed at 2:15 ESt.


  237. WFR let’s look  for that Breakout got Jun 75 @ 2.75 the mays are for .90-.95 in case


  238. mck – nw!  just reading the market…


  239. mck, i prefer selling the 280 calls against the 300 calls or something like that to be positive theta and collect big premium with, in my opinion, relatively small downside, which can be adjusted if necessary before expiration if MA breaks higher yet again…the 260 puts are cool for a daytrade but just getting roasted with theta otherwise


  240. So pessimistic Phil.  tommorrow Fed does nothing (finally) market rallies 300+ points, flutes from heaven, Steve Jobs quest for world domination comes to fuition and the Twins win the World Series!  ohh and the Da Vikings finally the Super Bowl!


  241. MA/RMM – Very nice, good little option play on that one!

    2x – yes 2x the number of contracts (which is 2x the current price anyway).  The idea if you are buying is to reduce your basis and the idea when you are selling is to increase your caller’s premium.

    YHOO – told ya so!

    AAPL/Ash – $175 is just about a 2/3 bounce from the $200 high to the $120 low so I’m expecting it to top out here for the month.  The key to establishing a long position is to wipe out your premium as quickly as possible and, following Warren Buffett’s Rule #1:  Don’t lose money!  That means you need to be ready for at least a 50% retrace off the last consolidation, which was $150 so we need $12 of protection and a clear path to wipe out our premium.  Best right now is the Oct $165s at $26.60 which have $16 in premium and require $9 to roll down to the $150s.  We can get that by selling the $170s with $4 in premium and $9 in downside protection which we can then roll to the June $175s or $180s for another $8 in premium, covering of $12 of our $16 in premium by the 16th and maintaining enough protection for us to ride out a 10% pullback without losing our position.  XXX

    MA/Eph – LOL, that is a funny set.  I’d buy back the putters, what good are they doing you?  The $150 putter at .85 is tying up margin and will give you about .15 per month.  You can buy them all back for $190 and sell 1 $180 put for $2.28 if it makes you feel better but I wouldn’t tie up margin on them at all.  On the Mays, I’d roll the $260 caller to the $270s (-$6) and roll the $270s to the June $270s (+6) which is $12 out of your pocket but you are putting the caller into $6 more of premium and leveling your positions and, if it keeps going up, you can roll him up to the June $280s better than even, maybe even the $290s, nicely reversing your situation.  If you can afford it (and I take if from your use of margin that you can) then by all means go longer like the July $260s or the  Oct $250s, which have premiums that can be quickly wiped out, leaving you with real value and the ability to generate more money selling calls.

    If you want to sell naked calls, sell the $280s for $7 and roll them to the June $300s, which are now $7 and then the July $320s for $7.. and you’ll collect $42 PER CONTRACT between now and October and the stock could be at $400 before you have to pay out the caller (vs the $110 you’d owe the Oct $290 caller if MA goes up $20 per month).

    USO/Oil – No ratio, I just peg it at various points in the day.  It usually tracks almost penny for penny intraday but long-term it’s useless.

    Very nice, oil closed at $115.63, down 2.64%, a very, very bad 2.5% rule signal indicating much downside to go (almost certainly 1.25%).

    Congress/Oil – that is a really desperate stretch to blame this Congress for not being able to undo the wheels set in motion by 6 years of 3 branch rule.  In fact it’s totally ridiculous when the remaining Republicans fillibustered the Dems energy bill, struck down the mileage standards etc. etc.   You do bring up a good point though, it is probably not enough to take over the government by simple elections – we need to execute the old regime and really clean house in a good old-fashioned revolution, then we can get something done!  8-)

    See, I told you we would just revert to back to the norm on any pre-fed move!


  242. If anyone is holding C JAN09 22.5 you can roll out to the JAN10 25 for .05.   Not bad for an extra year to sell.


  243. OK now I have to take the CVX June $90 puts for $1.65.  XXX


  244. Phil,
    ALthough I don’t have a going problem, I do have a Boeing problem. I had may 80′s 1/2 covered witih Apr 75′s. I rolled the Mays to aug 80′s and the Apr’s to may 75′s. In an ideall world, I know, It should be reversed. My thought is to start to roll the 75′s to the June 80′s, then to the 85′s, and do an even roll of the Aug 80′s to the Jan 85′s. I probably don’t have enough margin to 2x the caller roll so I’d have to do it in stages and I’m not sure I want to be more than half covered. Any thoughts? Thanks.


  245. the best idea that Bush ever espoused was to build new refineries on closed military bases / unused government land in order to facilitate the construction process and eliminate most of the permitting processes.You still have to fault Congress for failing to approve drilling in Anwar.


  246. Oh no!  They’re bringing out TBoone at the close in CNBC – that’s when you know they’re sweating!

    It’s funny in the DTP that we now are ahead on our oil puts but now owe our putters money! 

    XOM is back to that $1.35 I told you it was greedy not to lighten up on yesterday!  Today we had to go .30 lower to get to it so I’m setting a tight stop here as this was a very good day for our XOM puts, hopefully we get $1.50+  XXX



  247. Mark,
    Are your  S and R points calculated by your program automatically, based on the previous day’s numbers,
    or some other parameters?
    Thanks,
    JB


  248. Phil – Re CVX. In DTP you had 80 Jun90P & 40May90P. It is my understanding that now you have 40 May-Jun90P spread, is this correct?

    -->


  249. Lol. On Tuesday, Europe’s biggest oil companies, Royal Dutch Shell and BP, reported first-quarter profits built on the back of record-high crude prices. Those profits were so astounding that not even the industry’s top equities analysts saw them coming, which itself is astonishing, given all the ruckus surrounding oil prices.


  250. Phil,
    TASR
    Your TASR position is less bullish now that you’ve layered the Jun/Dec spread over the naked $7.5s.  I gather that you’re no long expecting a bounce, or as much of a bounce, as you were earlier.  Can you explain what’s changed?  Many thanks.


  251. JB – yes.  Most systems have the option to include Pivot Points just like you can include MACD.  See if your system allows it.  It’s a standard pivot point calculation…


  252. MCD- anyone have ideas/expectations on if this thing is breaking out? it’s been mad strong lately- 60 is a huge level.


  253. Congress won’t even approve additional drilling offshore and in the GOM – while China is building rigs off Key West (Cuban territorial waters).
    This can be fixed tomorrow but that would mean Congress actually doing something vice pontificating on steroids in baseball etc.


  254. Where’s OPTrader been? Is he off on his own forum now or taking a break?


  255. Anyone having problems with TOS and their option chains.  Very slow response in pulling them up.


  256. USO/phil- what do u think about the MAY 85 puts as a cheap and very speculative play on a hawkish fed? i’m wondering about IV on these guys b/c the FOMC may b like an earnings report on commodities.


  257. xian – for whatever it’s worth, I covered MCD a few days ago with the 60s when it touched 60. It was in the 55 – 56 range just a few weeks ago, and I’m much more concerned about down than up in the next several days :)


  258. Phil – Is CALM still a buy?


  259. Phil
    How did you figure we needed $12 in protection?
    "[AAPL] $175 is just about a 2/3 bounce from the $200 high to the $120 low so I’m expecting it to top out here for the month. That means you need to be ready for at least a 50% retrace off the last consolidation, which was $150 so we need $12 of protection…"


  260. XOM – out at $1.40, not bad…

    BA/Hak – Hopefully you learned why it’s an awful idea to sell a caller below you unless you have a VERY good reason.  All you can do (that is sensible) is roll your Aug $80s back to 3x the Aug $85s at $4.90 (-$6.70)  and roll your callers to 3x the May $85s at $1.75 (-$5.45) which is really no better than just buying out your caller and going naked until you roll him to 3x the June $90s and pick up another $6, hopefully without paying him, which means you are back to near even with July still to sell.  It is only better than nothing because giving your caller an advantage on a stock with low average premiums into earnings hurt you a lot worse than it hurt him.
    ANWR – environmental issues aside I do not fault Congress for saying we don’t need to tap the last remaining reserve of oil in the United States.  I guess we could have a policy that chops down all these silly trees and we’ll burn them for firewood and when we run out of that we’ll take an axe to our homes….  The answer that needs to be addressed is not how to find a way for oil companies to sell us our own oil for $100,000,000 a day but how not to use 1/4 of the worlds oil every day.  We also don’t have a refinery issue, again this was a way to give our nations land to his buddies, having nothing to do with need.  Why not designate 100 sqare miles of South Dakota to be Refinery City and build a great big pipeline to supply the US?  Because it’s not prime real estate and the oil companies already have refineries they could be mainitaing and expanding capacity on but they don’t do it because we’re fully supplied at 83% cap utilization and that’s still too much for VLO who are selling 3 refineries off.  Just like rice, if you believe there’s a shortage, there’s a shortage, but there’s nothing real about this one.

    CVX – Yes 80/40 but I’m DD at $1.65 on the puts so now 160/40 in DTP.


  261. MCD/steve- thanks, i’m feeling the same way- basically, reversion to the mean logic and i have some 57.50 and 55.00 callers that r eating my lunch right now.


  262. Mark,
     Thanks, I have been using the online calculator and doing  a manual input. But Fidelity’s AT has pivots, but they are quite different than the online calculator and no one there, (at Fidelity) knows anything about them. An automatic system would be great. Always appreciate your notes on them.
    JB


  263. There is a V madness out there even with the missed earnings!!!


  264. phil,
    I’m trying to understand your analysis on AAPL to Ash.
    (1)  2/3 bounce of $200 high to $120 low  = (200 – 120) * 2/3 =  53.33.  Current price is 175.  I guess you added $53.33 to $120 and rounded to get to $175.
    (2) 1/2 retracement = $53.33/2 = $27.00.  The protection price looking for is $120+$27.5 = $147.5 rounded to the nearest consolidation which is 150.00.
    Did I read your analysis correctly?  I’d appreciate your clarification on this.
    Thanks.


  265. emotrader/V- totally. i guess everyone thinks this is MA all over again. i think they may b right as far business models go and the secular purchasing shifts…AND emerging markets growth…hold on, can i still buy this? LOL


  266. emotrader- is that a allusion toto the emo music genre?


  267. POT: lot of block selling means the big boys are moving their money out.  Don’t get greedy with your ag puts.


  268. Xian- Why didnt you remind me the soccer game is on.  ESPN2


  269. POT- there not blocks, they’re bricks and not worth it if that’s the way it’s handled..LOL


  270. bbd- AHHHHH!!!!- i forgot tooo!!!! i’ve been doing mad science today-  i wrapped up the final experiments for a paper…BOOYAH!!!


  271. xian – It’s possible that many callers could hurl their lunch tomorrow thought! We’ll see :)


  272. thought = though  above


  273. steve- i hope. i’m positioned for a hawkish FOMC by shorting the oil and covering all my names…even AAPL.


  274. Malai
    That’s how I figuered Phil’s numbers.


  275. Phil,
    What are ur thoughts on NEM puts?  If the dollar is firming up, won’t it be a good bet on NEM puts?
    Thanks.


  276. JB – no worries man.  yeah kinda sucks they don’t include it (thought it was rather standard?).  Only thing to do is calculate it out then add your own I guess…


  277. 15:07 Express Scripts-ESRX reports Q1 EPS 70c vs. consensus of 67c [MO
    15:05 *EXPRESS SCRIPTS 1Q REVENUE $4.60B                     :ESRX US
    15:04 *EXPRESS SCRIPTS BOOSTS FORECAST                        :ESRX US
    15:04 *EXPRESS SCRIPTS BOOSTS FORECAST                       :ESRX US
    15:04 *EXPRESS SCRIPTS 1Q EPS 70C                             :ESRX US
    15:04 *EXPRESS SCRIPTS 1Q EPS 70C                            :ESRX US
    15:04 *EXPRESS SCRIPTS A 35% BOOST IN 1Q E                    :ESRX US


  278. Express Scripts-ESRX expects FY08 EPS $2.95-$3.03 vs. consensus of $2.98

    down about a buck ah…


  279. xian – you’re a scientist?? what paper?


  280. kwan- yup- i’m looking at publishing this in the journal of biological chemistry or journal of bacteriology…hopefully JBC.


  281. Interactive Brokers showing GOOG down $522 and a last trade of $30.  Back up the truck………


  282. Mark – FSLR earnings …..  when do you see them available ?  I am showing 8:00 ET on briefings.com, but you seem to get the info ahead of their times.


  283. xian – that’s baddass.  I don’t have a clue what it could possibly be about, but the journal name alone sounds flippn’  sweet.


  284. Phil, it has always been a good idea to breakup the verical integration of big oil i.e.do not allow it to control exploration ,refining and then retail the product: thereby, creating a virtual stranglehold on petroleum products… that being said  it can’t be a  good idea to continue to have a significant portion of our domestic refining capacity  vulnerable to hurricanes . Since, drilling offshore is not allowed on the west coast and only in limited areas of the GOM and the enviromentalists will never permit large scale shale projects or coal to petroleum conversions  we have to have access to sources such as Anwar..


  285. Doug – I show 8 EST too on bloomie… but just to make sure here’s straight from the horses mouth.  http://investor.firstsolar.com/events.cfm?lang=eng


  286. Those VIP (V SEP 80C) actually ended up ITM!!!!!!!!!!!!!!!


  287. 15:25 *PICKENS SAYS OIL STOCKS REFLECT $70 A BARREL OIL
    15:24 *PICKENS SEES `EQUITY PLAY’ IN OIL STOCKS
    15:24 *BOONE PICKENS TELLS CNBC EQUITY PRICES DON’T REFLECT $100 OIL


  288. Malai,
    This is my interpretation:
    draw Fib. retrac. between 202 and 115.  2/3=66% from the top is about 175. A 50% retracment is about 159. If you draw a price channel from March of the highs and lows, you should get range bound around 159 and 175.


  289. forgot this was happening:

    15:26 *CITI SEES TIER 1 8.5% WITH $6B PFD STK OFFERING, $3B STK OFFER
    15:25 *CITI ‘PLEASED’ WITH ‘STRONG INTEREST’ ALREADY RECEIVED   :C US
    15:25 *CITI BEGINS OFFERING OF $3 BILLION IN SHARES              :C US
    15:25 *CITI SAYS TIER ONE CAPITAL RATIO WOULD HAVE BEEN 8.5%    :C US
    15:25 *CITI SEES OFFERING INCLUDE OVER-ALLOTMENT OPTION FOR ADDED SHRS
    15:25 *CITI SEES TIER 1 CAPITAL RATIO 8.5% PROFORMA             :C US
    15:25 *CITI REPORTS $3B STOCK OFFERING                           :C US
    15:25 *CITI REPORTS $3B STOCK OFFERING                           :C US
    15:25 *CITI ANNOUNCES $3 BILLION COMMON STOCK OFFERING          :C US
    15:25 Citi Announces $3 Billion Common Stock Offering


  290. Well did not get my pop on V that I was thinking of.  Instead it happened on MA.  That has happened before on them.  But I sold MAY 80 covers on V but accidently bought them instead  so I made 128% stupid luck profit on V today.


  291. Phil.

    What play do you like on the XLE.
    If we get an oil bubble pop. where do you see them going?
    Looks like $75 is a moving average zone that could be a fun gamble on the $75 put @ $0.40 in May. What’s your thought on this oil play… Thanks!


  292. Singapore Steve – I wouldn’t tell anyone


  293. Mark
    That is too bad for my C MAY 25 callers.  I may not have to roll them.  C is 25.7 in AH.
    Plus how do you copy an paste.  Was it through Paint an saving as a jpeg then post in tinypic?


  294. I’m having a little trouble trying to understand Phil write so if someone can clear this up for me that will be great.
    On Phil aapl play, he is calling for a pull back with 150 as the support
    He suggest getting the buying the Oct 165 for 26.60 paying 16 in premium
    Sell the may 170 for 8, if aapl pull back we are cover with the 8 in premium
    the last part i could not understand, he suggestion rolling to the 175 and 185. What does that mean and under what condition?
    if someone can explain it to me, that will be great.


  295. C – market doesn’t like that.


  296. TASR – My Sept $7.50s were down from $1.50 to $1.25 so my priority shifts to getting my money back and selling the June’s both protects my new Decembers and is very likely to give me the .25 in premium that I lost while still giving me a full 150 calls open to the upside so I make no less if it goes up and, if it doesn’t, I stop the bleeding.  It was 25% cheaper than a DD, which only would have increased my risk without improving my position by much.

    MCD – this is about the right price for them (low $60s).  They are a very solid long-term play.

    Congress – Again, Jeb Bush veto’d allowing drilling off the shore of Florida, not Congress and the fact of the matter is that oil companies simply don’t spend money to explore.  XOM spend $15Bn exploring and building new wells while they bought back $40Bn of their own stock and paid out $8Bn in dividends becasue oil is through the roof due to lack of production.  The problem is we need LAWS that do not make it more profitable for oil companies NOT to produce oil.  Why on earth would XOM want to produce twice as much oil for half the price?  The only way you can get them to do that is to hit them with an excess profit tax when oil is over $70 so they are incentified to pump more barrels at $70 rather than less at $120 but that too was fillibustered off the Senate floor.  Surely you people hear these things are happening and don’t actually believe this BS that "Congress" is stopping the poor oil companies from helping you.  You can’t let them shove their press releases down your throat and, even worse, you can’t let them turn you into a party-line parrot – what’s in it for you? 

    This is how Democracy is stolen from the people, speak a lie often enough and it becomes accepted as the truth until the people don’t even know what they are voting for…  I saw this great thing on TV where they interviewed people in a primary state and they actually asked people "Which party believes in God?" and the people who answered Republicans were given the follow-up question "So the Democrats don’t believe in God" which got a 60% yes response.  This is the bill of goods that has been sold to the American people and, since their primary news source is "Weekend Update" or, even worse, Fox news, it manages to stick…

    Optrader – busy with his own thing, he’s setting up a member site so lots of work…

    USO – with 13 days to go on the contracts I don’t like May anythings that are out of the money.  You’re making a pretty much all or nothing bet on the Fed and most likely there’s already a Fed premium built in.  That’s why I like the June CVX puts, not May and why I got out of XOM, we got a good day, if we get a bad open tomorrow and a bad day we may never recover so not worth the risk.  With USO I would go with the June $94 puts at $6.25 and sell the May $89 puts for $1.60 which puts me in for net $4.65 which means that by the time I owe my caller a penny at $89, I’m already 100% in the money at $5 with a 1 month advantage and I can then roll him to a June vertical or I can roll myself back to July for just $1.15 more.  If USO goes up, $1.60 will roll me up to the $97 puts and I can sell again or just get out. 

    CALM – I like them down here but no one else seems to.  I think they will do well when feedstock goes down but right now they are lumped in with Ag and trading down with the overpriced commodities.

    AAPL/Edro – Last leg up was from $150 to $175 = $25.  50% of $25 is $12(.50).  We’ll move on to division next semester…  ;)

    AAPL/Malai – Yes, it’s not an exact science so I don’t fixate on $53.33, we bottomed around $120 and topped at around $200 and had a plateau at about $150 and are now at $175 so I’m comfortable calling the $25s the 1/3rds and I venture to say that if you look back at our bottom you’ll probably get a mean that is more like $125 than $120 so the bad data point was the assumption of the bottom at $120, not the subsequent stages. 

    ANWR is a sham.  I just pointed out how a very small change in auto consumption could save us millions of gallons a day, shifting to EU-style 35mpg cars would about 1/3 of our fuel consumption – FOREVER.  That would be 7 fully capacity ANWRs and would cause a 10% glut of worldwide oil with the entire output of Iran, Venezuela and Nigeria going completely unused (not to mention the 3Mbd the Saudis already took off-line last year as we already have a global production glut).  As I said, all the world’s auto makers, including Ford and GM already produce fleets that get 35mpg – this is the only country on the planet that still allows a 20mpg fleet to be sold and, since it’s more profitable, that’s what we get! 

    This is the sham of saying the government shouldn’t legislate commerce – THAT’S WHAT GOVERNMENT IS SUPPOSED TO BE THERE FOR!  If you let business do whatever they want what they want to do is bleed the consumers dry by providing as little as possible for as much as possible and the market system certainly doesn’t reward the long-range planners. 

    Woo hoo, C took a big hit!  Nice way to shake off the callers!

    XLE – I have to run but same deal as OIH, let the May putter pay your premium but all you guys are very late on the bandwagon but nobobdy believed me – Oh nooooo!


  297. Singapore Steve,
    I bought V MAY 72.50 naked yesterday, It was down big in the morning and I made good on them today. Got lucky, just lucky.


  298. SS – my news like CITI stuff that’s just copy paste.  For the charts yes paste to paint, save jpg, load it up on tinypic, share with the PSW world.  I’m using work computers so don’t know how fast anyone’s connection is but mines "rather speedy".  ;)

    Have a good evening eveyrone!


  299. XLE – I believed you Phil. Been rolling and selling with you since April Fools. ; )


  300. Gas Demand Link – billbigd (should interest you)

    Very telling…I volunteer to update this info for the site periodically. 

    http://tonto.eia.doe.gov/dnav/pet/hist/c100000001m.htm


  301. MA – (Tesorohaters, Mark) - thanks for the MA advice. I ended up doing the 260 puts long as a daytrade (stock from 277->274) so I made a bit there, then sold May300 calls at EOD to use Mr. Theta.


  302. Fred,any current VLO positions?


  303. thanks, mark. it is very cool, but not very difficult when u r interested in it. it’s pretty damn awe-inspiring to c the depths of understanding we (as a species) have reached.

    it’s very sad that sciences arent pushed harder in schools- the value there is not about the facts, but the critical thinking and creativity it fosters. we r losing the global arms race in human capital.


  304. USO/phil- totally. i’m better off keeping that cash for rolling out if necessary and/or DDing. its my old profligate ways creeping back and tempting to ride that "front month horse" one more time. 

    i guess the question was more me gauging ur expectations for tomorrow- thanks a ton.


  305. Phil,
    Thanks for the suggestion re: BA. I think the least draconian way to go is to sell 6 contracts against my 5 callers for a $400+ loss with holding my 4 Aug 80′s going forward to either recoup, sell 85′s or 90′s against or to roll up and out to a further month. It became a little too big a position for me anyways. Who knows, tomorrow could see my caller drop a few bucks LOL.


  306. Rate Cut Would `Do More Damage Than Good,’ Gross Says (Update3)
    By Caroline Salas
    April 29 (Bloomberg) — The U.S. economy won’t benefit from additional interest rate cuts by the Federal Reserve and would be better served by a law to stem foreclosures, said Bill Gross, co- chief investment officer at Pacific Investment Management Co.
    “Lower Fed Funds? They would, in Pimco’s opinion, likely do more damage than good from this point forward,” Gross said in commentary on Pimco’s Web site. “Foreign and domestic investors are being fleeced with negative real interest rates, and the weak dollar, stratospheric commodity prices and steadily rising import inflation are the result.”


  307. xian- that’s hilarious. I guess that means PIMCO has finally taken their full position on mortgage bonds and short treasuries, and wants the Fed to start pursuing stronger monetary policy.


  308. web savy people- is there a way to copy the image in the background of this intro? it’s totally cool. 
    http://www2.pimco.com/pimcoad/pimcoad_normal.htm


  309. i dont know if wright has a history of speaking at the washington press club, but if not, then i’d say wright was invited (used) to speak there in order to given a large audience and stimulate him into making obama look bad…what a fool, he should have turned down the speaking engagement or cancelled (if he wanted obama to have a better chance at winning)

    Obama Calls Wright’s Remarks `Ridiculous,’ Offensive (Update1)
    By Kristin Jensen
    April 29 (Bloomberg) — Democratic presidential candidate Barack Obama denounced “ridiculous” statements made by the Reverend Jeremiah Wright, using his strongest language to date to distance himself from his former pastor.
    Obama cited Wright’s contentions, repeated yesterday, that the government may have had a role in spreading AIDS in the black community, that U.S. actions overseas were partly to blame for the Sept. 11 terrorist attacks, and about the importance of Nation of Islam leader Louis Farrakhan.
    Wright’s statements “offend me, they rightly offend all Americans and they should be denounced and that’s what I’m doing very clearly and unequivocally today,” Obama said in a news conference in Winston-Salem, North Carolina.


  310. Actually, I don’t think he’s so far off the mark. Reagan’s inaction and indifference certainly fostered the spread of Aids in the gay and subsequently black communities and our military bases in Saudi Arabia have been suggested as reasons for 911. As for Farrakhan, well 2 out of three ain’t bad.


  311. xian – awesome!  I think my next one is going to IEE nanotechnology


  312. AT&T to cut the price of Apple’s new iPhone
    http://www.tinyurl.com/6328tx


  313. Phil-
    I sent something for you to the admin@philstockworld.com email address.  It has to do with oil and I thought you might be interested.


  314. Re: Wright Speech at Press Club.
    There’s a lot of talk that the woman who was a key organizer for the breakfast, a professor at Howard University, is an "ardent Clinton supporter".  If so, all I can say to Rev. Wright is welcome to politics in America. 
    At the risk or offending some, I welcome his comments not because I agree with them but because they likely do represent a world view that I never have experienced and never will experience.   They do make me think about things and, at least for me, I think that that’s good thing.
    Having grown up on the south side of Chicago, I often heard Louis  Farrakhan’s animated vicious tirades and before that Elijah Muhammad’s calm, but equally vicious, preachings on the local radio stations.  These guys were absolutely off the charts flippin’ insane.  In today’s debate, Wright sounds like an off the wall looney but 20 years ago, compared to these guys, yesterday’s speech would have sounded like the voice of reason looking for a center. 
    I’m still torn between Obama and Clinton so I’m not trying to make an argument for either being right or wrong but 20 years ago, when Obama made his choice of pastors from the big churches on the South Side, Wright was a pretty sane choice given the other options that were floating around the neighborhood.


  315. this is the pinnacle of irony.

    Bush Blames Congress for Failing to Act on Energy

    April 29 (Bloomberg) — President George W. Bush blamed Congress for blocking his initiatives to mitigate rising energy costs by expanding domestic production and said lawmakers also are delaying action on other measures to address higher food costs and the mortgage crisis.

    “It’s a tough time for our economy,” Bush said at a news conference today at the White House. While the public is demanding action, “on many of these issues, all they are getting is delay.”

    The president dismissed calls to stop federal purchases of crude oil for the Strategic Petroleum Reserve and he declined to endorse proposals to suspend collection of federal gasoline and diesel taxes as ways to cut costs to consumers.

    Democratic leaders, who have majorities in the House and Senate, responded to Bush’s remarks by faulting administration policies and accusing the president of failing to act.

    Bush “has closed his eyes and put his hands over his ears as these crises have grown,” Senator Charles Schumer, a New York Democrat, said at a news conference after Bush spoke.


  316. ….sad, heart-breaking irony….


  317. kwan- from the little i know about nanotech, i think its a very exciting field. i try to keep up by reading nature biotechnology and am amazed by the commercial apps that r being pursued or already available.

    i think a very important tech breakthrough will b a computing or mechanical device that employs bio-like components. i work on an outer membrane transporter (basically, a selective tunnel through the membrane and into the cell) and have come to think of it as a nano-machine.


  318. Phil,
    I plan to wait until after the Fed tomorrow but assuming AAPL stays where it is and reading your posts today regarding rolling up AAPL what are your thoughts on my positions. I would like to take some money off the table if I can so I can use this to reposition later if AAPL drops but it may make sense to keep it all in play.
    12-AAPL Oct 140′s- Basis $22 now $43
    6 short May 155′s-Basis $13 now $21
    6 short May 160′s-Basis $10 now $16.5


  319. xain & Kwan:  here is a science project for you guys.  How about designing a flexible solar panel system to power a yacht that can be hoisted up a mast system like sails?  The price of fuel for big boats is getting really expensive, maybe the time is ripe for a combination sail and solar power system for boaters.  What do you think?


  320. Greg – the flexible substrates are already available and used in different applications (not cheap, but available), but I think the main problem would be getting solar cells that are considered to be ‘efficient’ onto these flexible substrates.  The good ones actually split the available light spectrum into visible and near-infared (for example).  I don’t think there are any technologies that you can grab off the shelf capable of producing this with just ‘some assembly required’ but it probably wouldn’t take much to make a working prototype.  The bigger problem I think is efficient storage the collected energy until its ready to be put to use.  The materials for energy storage are really lacking in comparison to the materials that generate the photocurrents themselves (i.e. the solar components).
    I’m pulling most of this info from talks that a lady from Oakridge that paid our campus a visit a few weeks ago and another guy that was here last week from Penn State in case anyone is wondering.  Very neat idea though, and doable if one can round up enough minions…
    xian – it’s interesting you think of your research as a nano-machine.  The biophysicists I share a space with think of their nano-machines as biological systems!  This stuff really all begins to look the same once you get small enough.


  321. xian – kudos to you completely sir!  I just logged on before I go to bed here, but had to comment.  Completely agree with your 6 PM post.  I’m no scientist, and will never be one, but just like science the arts are slowly losing ground in our schools.  I see kids today playing GH 3 for hours on end and not going out to play, to ride their bikes, to read a book, to burn ants with a magnifying glass… I have the horrible suspicion that in 20+ years the youth of today will hit the workforce with a whole bag of nothing (i.e. the movie Idiocracy which subsequently is not that great but we get the point).  I’m very happy to see free thinkers like you, xian and Kwan, who are constantly trying to add to the human collective knowledge instead of holding an ops / sales / tech position.  No offense to the latter (I’m one of course) but there in lies the fact that we all need to contribute one way or the other (thru action more than spoken / written word) that it’s important to always keep learning. 

    Anyways I’m rambling / tired and prob not making much sense.  Have a good night ya’ll.


  322. just caught up with my reading for today.  this group does not fail to impress me with excellent exchanges.

    and terrific post, as always phil.  thought of this quote when reading it:
    There are three kinds of lies: lies, damned lies, and statistics.
    http://en.wikipedia.org/wiki/Lies,_damned_lies,_and_statistics


  323. xian, I have an even better picture for you.  If you want the full-res version, which is 2048 x 1536, email me at filmflamtv@gmail.com

    http://i26.tinypic.com/e13kmd.jpg


  324. Sorry, forgot the details.  That was taken by a friend of mine who crews on yachts.  That was in the Bahamas.  Undoctored.  That is what it looks like.  She says that was exactly what it looked like.


  325. Phil
    I was wondering if you where going to do a review of the LTP portfolio in the coming days? Thanks


  326. Good morning everyone.

    UK opened flat, Japan held interest rates and is essentially flat, Shanghai had a good day up 3-4%.

    British Gas attempting to buy an Australian energy supplier for $12B. (Out of the blue that one.)

    Everything else looks flat ahead of your FED announcement.

    Sorry the early report is not up to Ramanas standard :-)


  327. Wendywheel
    Good link but it left off Pandering and Misspeaking… LOL


  328. Phil
    Right on the mark about government’s role in regulating business . It is just amazing how the NeoCons believe that some greater good comes out of unbridled Capitalism.


  329. I found my OIH puts had been changed from OIHQR and OIHQS to OKVQR and OKVQS.  They are showing up as "adjusted" and with less value than the original ones.  Did anyone else have this happen?  It looks like it took place over the weekend.  I’ll be calling my broker this AM


  330. FSLR – looks like they beat but I’ll bet it’s no where near the "whisper" number.


  331. xian – on Wright being used, I agree with you, he got lured into the den. His biggest beef seems to be with the press and they’re eating him alive. I watched a copule of his  talks on cspan, and his words are definitely getting spun. His biggest message seemed to be that the press didn’t understand his remarks, hadn’t done their homework, etc. – he said it repeatedly. They’re turning him into a thorn in Obama’s side.


  332. film/peoples- this is one of the trippiest photos i’ve ever seen- sunset at the north pole- res is not great, though.
    http://tinypic.com/view.php?pic=30j2xia&s=3

    mark- thanks. and i totally dig the need to let kids do art/music. this is a very cool TED talk on the subject of state education and the low value (even discouragement) placed on creativity in our education system. i guess people who have had their creativity and critical thinking passified r easier to fool as an electorate.
    http://www.ted.com/index.php/talks/view/id/66

    greg- i think that can b done (but wouldnt know how to do it). all we need is a manhattan-style project for solar or alternative energy in general. imagine if bush used all the war money (like $600B+) and his 8 yrs as president to get a project like that running. i know we’d have real breakthroughs by now.

    mck- if obama is dem nominee, then his best chance is that the repubs overplay the "wright card" enough so people realize it’s all shtick and soundbytes…i can only hope.

    anyway…ok 815am. only market stuff from me until the close.


  333. this made futures go flat:

    7:15 *ADP EMPLOYER SERVICES SAYS U.S. GAINED 10,000 JOBS IN APRIL

    How can people still think ADP is accurate?!?!  Oh well… 12 min and counting.


  334. so if GDP comes in declining AGAIN that’s 2 in a row and technically we’re considered in a recession… ooo the suspense builds!


  335. FSLR down 8 bucks post earnings

    *FIRST SOLAR FORECAST BY CHIEF FINANCIAL OFFICER MEYERHOFF
    *FIRST SOLAR SEES SHIPMENTS OF 420-480 MEGAWATTS THIS YEAR
    *FIRST SOLAR SHIPPED 79.4 MEGAWATTS IN FIRST QUARTER    :FSLR US
    *FIRST SOLAR’S AVERAGE COST PER WATT WAS $1.14, AHEARN SAYS
    *FIRST SOLAR CHIEF MICHAEL AHEARN COMMENTS ON EARNINGS CALL
    First Solar-FSLR reports Q1 EPS 57c vs. consensus of 47c [MORE]
    First Solar’s Profit Soars as Demand Rises for Thin-Film Panels
    *FIRST SOLAR, INC. 1Q EPS 57C                          :FSLR US
    *FIRST SOLAR 1Q REVENUE $196.9M                         :FSLR US
    *FIRST SOLAR 1Q EPS 57C                                 :FSLR US


  336. GM up 5% post earnings… so even though they suck they don’t suck as bad as traders think.

    ALU, CL down.  KFT & PG up.


  337. OOOOO I can just TASTE it… 1 min!


  338. 7:30 *ECONOMY IN U.S. EXPANDED 0.6% IN FIRST QUARTER, SAME AS IN Q4
    7:30 *U.S. FIRST-QUARTER EMPLOYMENT COST INDEX INCREASES 0.7%
    7:30 *U.S. FIRST-QUARTER EMPLOYMENT COST INDEX INCREASES 0.7%


  339. April 30 (Bloomberg) — The U.S. economy expanded at a 0.6
    percent annual pace last quarter, reflecting an increase in
    inventories as consumer spending slowed, investment dropped and
    the housing slump deepened.
    The gain in gross domestic product, the sum of all goods and
    services produced, was more than forecast and matched the pace of
    growth in the previous three months, the Commerce Department
    reported today in Washington. The last time the economy grew less
    was in the fourth quarter of 2002.
    Spending by households, the biggest part of the economy, grew
    last quarter at the slowest pace since 2001, when the U.S. was in
    a recession, as job losses mounted, food and fuel prices surged
    and property values tumbled. Federal Reserve policy makers are
    forecast to cut the benchmark interest rate today to limit the
    downturn.
    “The economy is struggling, it’s not going anywhere fast,”
    Mark Zandi, chief economist at Moody’s Economy.com in West
    Chester, Pennsylvania, said before the report. “The fundamental
    problem is the declines in home values and resulting impact on the
    financial system that’s weighing sharply on the consumer.”
    The economy would have contracted last quarter if not for an
    increase in inventories that was probably caused by the slowdown
    in sales.
    Economists forecast a 0.5 percent gain in first-quarter
    growth, according to the median of 80 estimates in a Bloomberg
    News survey. Projections ranged from a gain of 1.5 percent to a
    0.8 percent drop. The report is the first for the quarter and will
    be revised in May and June as more information becomes available.
    Price Increases
    The report’s price index increased at an annual rate of 2.6
    percent, lower than forecast, compared with a 2.4 percent gain in
    the prior quarter.
    The Fed’s preferred inflation gauge, which is tied to
    consumer spending and strips out food and energy costs, rose at a
    2.2 percent pace, down from 2.5 percent.
    Consumer spending, which accounts for about 70 percent of the
    economy, rose at a 1 percent annual pace, the smallest gain since
    the second quarter of 2001 and less than half the 2.3 percent
    increase in the previous quarter.
    Americans have retrenched as employers cut payrolls by almost
    a quarter million workers so far this year, gasoline prices
    approached $4 a gallon and home foreclosures surged.
    “We’re in what’s called a growth recession that is going to
    last for at least another year,” David Resler, chief economist at
    Nomura Securities International Inc. in New York, said before the
    report. “Consumers are up against a lot of headwinds. High energy
    costs and the credit crunch have virtually stalled growth.”
    Business Investment
    Companies also cut back. Business fixed investment, which
    includes spending on commercial construction and equipment and
    software, dropped at a 2.5 percent annual rate, the biggest
    decline since the first three months of 2004, after increasing 6
    percent the prior quarter. Spending on new equipment and software
    fell at a 0.7 percent rate.
    Investment in residential construction projects fell at an
    annual rate of 27 percent, the most since 1981. The drop took away
    1.23 percentage points from GDP, after a 1.25 percent drag in the
    prior quarter. Housing has subtracted from growth since the first
    three months of 2006.
    Companies added to stockpiles at a $1.8 billion annual rate,
    after an annualized decline of $18.3 billion in the final three
    months of 2007. The figures added 0.8 percentage point to growth.
    The buildup may give way to cutbacks in production in coming
    months as businesses try to clear unwanted stockpiles.
    “As inventories are worked off, economic activity may
    decline outright this quarter,” Peter Kretzmer, a senior
    economist at Bank of America Corp. in New York, said before the
    report.
    Auto Cutbacks
    Automakers already are pulling back. General Motors Corp.,
    the world’s largest automaker, this week said it is cutting
    production by 138,000 large pickup trucks and sport-utility
    vehicles this year at four plants in the U.S. and Canada.
    “A significant adjustment was needed to align our production
    with market realities,” Troy Clarke, Detroit-based GM’s North
    American president, said in a statement.
    An improvement in trade continued to contribute to economic
    growth. The trade deficit narrowed to an annual pace of $495.9
    billion last quarter from $503.2 billion. The smaller gap added
    0.2 percent to growth, after a 1 percent boost the prior quarter.
    The deterioration in housing, employment and consumer
    purchases prompted Fed Chairman Ben S. Bernanke this month to
    concede for the first time that a recession is possible.
    Investors are betting the Fed will take a breather from its
    series of rate cuts after today’s action, according to trading in
    futures markets, on concern inflation will accelerate.
    Policy makers may also want time to gauge how the economy
    reacts to the rate reductions that started in September and to the
    tax rebate checks that began going out this week as part of the
    Bush administration’s fiscal stimulus plan.


  340. FSLR COMPLETELY changing course on their conference call.  now up 3 bucks.


  341. one more thing…

    keyser- i missed ur comment and wanted to say i appreciate ur point of view and share ur interest in the interpretations of people w/ very different experiences than mine b/c it helps me understand my own misconceptions (as well as the misconceptions of others)

    OK, i just had to give feedback to keyser…lest he frame us all for his misdeeds.


  342. Mark,
    We didn’t have a quarter negative to begin with unless you want to adjust for CPI which isn’t their technical definition of a recession.  In any case, it’s pretty amazing that the number wasn’t negative given all of the MSM hype scaring the consumer.  Of course, if you read that Harper’s magazine piece you get pretty depressed about the games government has played with GNP/GDP, Employment, etc.


  343. DNA,
    Loaded the boat yesterday selling 65 Puts on the spike down.


  344. Fred – no doubt.  Just playing around really.  I guessed .6 in our "Trader’s Pool" here and hit it on the mark.  Just trying to liven up the place a bit LOL

    Here’s a fun piece for you:  7:51 *CITI INCREASES STOCK OFFERING TO $4.5 BILLION


  345. FSLR 300+ now!


  346. FSLR,
    Time to short on the run this morning.  Maybe when it gets to around $310.


  347. All solar is flying….should be some good Put daytrades.  Looking to SOLF, SPWR, JASO.


  348. Hello:
    Can someone please explain to me the 5% rule Phil so often mentions in his posts
    Thank you