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Friday Already?

Well this week went by quickly!

As I mentioned in last night's wrap-up, it's been a very low volume week and, on the whole, it's been nothing to get excited about.  We need to make some serious break-outs on our Big Chart levels and I don't think that's going to happen with oil getting it's usual boost into the weekend, especially with Rent-A-Rebel now pre-announcing their plans

The latest oil terrorist to run up the markets is CNBC's own beloved Jim Cramer, who took time out of his busy schedule last night to devote 15 minutes of his show to misinform his viewers about oil.  If you have any doubt as to how important this message is to Criminal Narrators Boosting Crude, just log onto www.cnbc.com and look at where this segment is featured.

Cramer interviewed the CEO of JOYG, who supplies mining equipment, and somehow Cramer managed to twist a legitimate, healthy demand for minerals, into proving his point about oil.  Cramer's premise, that demand automatically means short supply is flawed on many levels.  If I have a mining company and you are paying me $86 a ton, I may run my mine normally (as it's only $20 more than last year) but, if one month later, you offer to pay me $104 per ton, I may order a little more mining equipment to cash in while I can. 

Yes there is a lot of demand for minerals and there are spot shortages, but they are due to delivery inefficiencies, not lack of availability.  It is called a demand CYCLE for a reason and sometimes the demand outstrips the supply but, in a free market, higher prices put more supply on line until you get to a point of equilibrium.  Speculators ruin the curve by creating false demand for product they do not intend to purchase causing miners to overproduce and commit to contracts with equipment makers like JOYG (a big Cramer pick) which eventually leads to a massive oversupply and crashes the market.  Don't worry though, Cramer and his pals will be long gone by then – off to put you into the next thing they are looking to get out of.

Cramer says (at the 2:00 minute mark) "The gap in coal could be 60 to 100 million tons this year, that's massive, even the US… can't make up that amount."  While this may be partially true, the US does actually produce an average of 1,400M tons of coal per year and has certainly shown the ability to produce over 120M tons a month on a regular basis so it is no stretch to imagine that the US ALONE COULD make an extra 60 (4.2%) and perhaps 100M tons (7.1%) over the course of the year if the demand were truly there.  On a global scale of course, 60-100M tons is a rounding error.  Con men like to use big numbers to confuse people who don't take the time to do the math and Cramer is a confessed master manipulator but this is a new low, even for him!

There are 998Bn tons of coal in the world and even this extensive IEA report shows there is no danger whatsover of a shortage through 2030.  Of course there is more demand, because it's cheaper than oil, but how can this be Cramer's premise for oil going up?  Coal is a substitute for oil, every ton of oil shipped is another barrel of oil we don't need – I know this is complicated so I'll type it slowly for Mr. Cramer – They are both used for energy!

Cramer keeps using the term "endless demand," it is probably good to be suspicious of people who say things like that, it's a lot like the guy who calls you on the phone with a "can't miss" investment or the guy who wants you to give him money for the perpetual motion machine or products that grow hair.  It's very hard to imagine that Cramer is actually ignorant of the fact that thousands of years of economic history are firmly against him.  The only thing that IS different this time is the runaway speculation that has been made possible by a combination of Wall Street pushing all forms of commodity investing along with a relaxing of regulation that allows rampant speculation in everything from cooking oil to copper.

When there was a housing bubble, there were plenty of speculators and CAT was a booming business as were building supply companies, HD etc and Cramer was right there telling his sheep to BUYBUYBUY and all those stocks did rise to incredible highs in a speculative frenzy while Cramer's pals at Goldman Sachs quietly turned around and shorted the market, making $6.5Bn betting against them whole gracefully dumping their long positions on Cramer's legion of bag holders.  Now, 2 years later, Cramer is herding the sheep into Bubble 2.0 and it seems that sheep have very short memories but you would think they would at least notice all the for sale signs on the homes they drive past as they drive to their broker to blow some cash into the commodity bubble

Anyway, I just want to say my piece now so that maybe, when Cramer is herding people into Bubble 3.0, 24 months from now, I will be able to point back to this article as a warning and save people a few bucks.  Meanwhile the CTFC is breathing down the necks of Jim's speculating buddies, perhaps causing the urgency of his latest pump as US regulators "disclosed a broad nationwide probe into potential oil-market manipulation and said they are expanding surveillance of energy markets."

According to the WSJ:

  • The CFTC's announcement about its oil investigation suggested a single, broad probe that began in December 2007. But people familiar with its enforcement priorities say the agency is pursuing multiple oil investigations, and that many of them relate to one another. CFTC enforcement chief Gregory Mocek said the agency has about 60 manipulation investigations open in various commodity markets.
  • The CFTC has expanded an investigation, disclosed previously by The Wall Street Journal, into alleged short-term manipulation of crude-oil prices via a widely used price-reporting system run by Platts, a unit of McGraw-Hill Cos. One suspicion is that energy companies and traders have at times issued a flood of orders during a time window used by Platts to determine its reported prices for physical oil transactions, then used the potentially distorted prices to make profits in other markets.
  • Another area of concern for CFTC regulators is whether the owners of crude-oil storage tanks use their knowledge to make bets on oil-futures markets. In theory, the owner of a tank could issue misleading information about the tanks being full or empty, leaving the wrong impression about whether oil is in plentiful supply. Then they could make trades to profit on the misunderstanding.
  • Large speculators such as hedge funds often use unregulated over-the-counter platforms, whose prices may affect prices on regulated markets. Mr. Chilton, the CFTC commissioner, said regulators are looking at cases where traders have made simultaneous bets on unregulated and regulated markets, in particular in West Texas Intermediate crude-oil contracts.

These are very serious accusations and, more importantly, serious indications that the government is finally getting serious about reigning in the madness of the commodity markets.  If this happens quickly, many commodities, but especially oil, could collapse like a house of cards as investors who thought they would have many months to unwind their positions suddenly find themselves losing 5-10% a week.

Asian markets were good this morning with the Nikkei popping 214 points but, as we noted in the Big Chart, they had a lot of ground to make up and the finish at 14,338 is still well below the 20% mark (off the 2007 highs) at 14,640.  The Hang Seng picked up 0.6% but has also lost a lot of ground over the past two weeks so it remains to be seen whether Asia is truly recovering.  India's economy posted better than expected growth (8%) but that makes it MORE likely that the Central Bank will tighten monetary policy.  Japan's economy went the other way with continuing declines in housing and industrial production.  Consumer spending was also off sharply and April jobs numbers weakened.

Europe is up about half a point.  UBS is under investigaion for helping wealthy clients dodge taxes, this could widen to other financials as it seems like it was rampant over there.  UK's Silverjet airlines ceased operations in another round of long-term demand destruction as those planes will use zero fuel next year.  Beware of the moves in Europe and Asia as they were generally based on declining crude prices and we know not to buy into those until we see it stick for more than a few days!

We had great earnings from Dell last night and that should give us an early boost to the Nasdaq in the very least.  Solar stocks are rallying as Germany cuts subsidies less than expected, including our pals at FSLR and we couldn't be happier as our last move on them was to take out our callers and roll ourselves down to the $280 calls.  At this point, I don't think things could possibly go better on that play and we may have to shut it down!  CY will lag the solars and the $28s at .85 will make a nice momentum play if the market stays strong.

Consumer spending and income were up 0.2% but that is barely keeping pace with inflation so I don't think much of the pre-market rally caused by those numbers.  Any positive close would be great today, especially on the Transports (2,714 is our goal), The Nasdaq (2,513) and the Russell (745).  It is probably too much to hope for the S&P to take back 1,425 but 1,405 would make key long-term support levels so that will be something we need to keep an eye on all day.

We were short on GOOG yesterday, expecting a top at $588 followed by a pullback to $575 and we'll have to watch this carefully.  Most likely we'll roll up first and then put tight stops on the position, giving up if it breaks $590 but, otherwise, let's stick with the plan.  It is the last day of the month so all sorts of crazy things can happen.

Have a great weekend,

- Phil

 

 

 

 

 


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  1. David – to what I posted on yesterday’s board, sorry not trying to beat a dead horse but just want to make sure you understand why oil was going up this morning:

    David – that’s an extremely broad sweeping statement that takes away what is REALLY happening with oil price increasing at the time you posted:

    May 30 (Bloomberg) — Crude oil rose as the dollar pared
    earlier gains, reaffirming the appeal of commodities priced in
    the U.S. currency as an inflation hedge.
    Oil has gained 33 percent in this year as a 6 percent drop
    in the dollar versus the euro made crude better value for buyers
    in other currencies. Still, oil is headed for its biggest weekly
    decline in 10 after a U.S. report yesterday showed gasoline use
    declining from a year earlier.
    “Oil’s most likely rebounding as the euro-dollar flattens,
    recouping earlier losses from this morning,” said Andrey
    Kryuchenkov, an analyst at Sucden (U.K.) Ltd. in London. “The
    recent rally in oil and other commodities was helped by the
    broad weakness in the greenback, making these commodities
    relatively cheaper for foreign investors.”


  2. U.S. Energy Policy
    We should ask the Abu Dhabi Energy Company to devise an energy policy for the United States since our leaders seem unable to fight their way out of a paper bag.  Isn’t this the stuff Sam Bodman should be doing? 
     
    Applied Materials (AMAT) announced this morning the Abu Dhabi Future Energy Co. contracted with AMAT to purchase three SunFab Thin Film Lines for producing solar modules.

     

    With an optional tandem junction upgrade, these SunFab lines are expected to annually produce modules with a targeted capacity of up to 210 megawatts (MW), or enough energy to power approximately 70,000 homes.


  3. 8:02 *CALPINE CALLS NRG TAKEOVER BID ‘INADEQUATE’            :*CPN US


  4. Treasuries Rise for First Time in Four Days on Slower Spending


  5. CFTC Actions
    Repost since you are talking about oil.  Very smart of the CFTC trying to get out in front of any investigation. 
    Mr. Wolf:  Hey honey the farmer is coming to check on the chickens.
    Mr. Famer (Sam Bodman):  Hey Mrs. Wolf how are you?  What are those feathers in your mouth? 
    Mrs. Wolf:  I was just doing some spring cleaning and fluffing the pillows.
    Mr. Farmer (Sam Bodman):  Oh okay, I’m just checking in on the chickens.
    Mrs. Wolf:  Oh don’t worry, we check on them every day.
    Mr. Farmer (Sam Bodman):  Gee thanks, I’m going on vacation see you next month.
    http://money.ninemsn.com.au/article.aspx?id=571813


  6. FSLR up about $18 at $270 premarket


  7. blog bloated? FYI — the comment editor seems odd lately, my browser hangs up whenever I refresh. Sometimes "page can’t be loaded" http error appears in the comment box, maybe going after "/wp-content/plugins/fckeditor_for_wordpress/fckeditor/editor/fckeditor.html"


  8. FSLR up 22 in pre market


  9. Mark – thanks for your feedback on the MOC action last pm.


  10. DELL puts on the opening spike?  Looking for a  quick 10-15%..


  11. FSLR – they’ll go up and we can short them again – Somebody call Cramer!


  12. mck – nw! 

    BBD just im’d me about SWN being downgraded at FBR… but it’s being supported pre market b/c:

    5/27 *SOUTHWESTERN ENERGY TO REPLACE TRANE INC. IN S&P 500 INDEX


  13. MCK – I don’t know of anyone else having that problem but I’ll send a note to Greg.  Perhaps download a browser update?
    FSLR – If you rolled down your putter to the $280 puts and rolled your caller to the $280 calls and have no caller then I’d call this very lucky and sell our calls and take out the putter, leaving us with just the $260 puts, which we can let ride.  XXX


  14. Phil,recover the fslr fly callers w/ the 270′s


  15. man I’m dumb, how’s about I post what happened to a stock 4 days ago… gawd what a morning.  As XIAN would say, Derrrrrrrrrrrrrrr………


  16. orion – selling puts? Personally I wouldn’t be buying them with dell bouncing off 7-8 year low and with Michael Dell showing he hasn’t lost his touch.


  17. Fricken Rimm and Goog kicking my butt htus morning


  18. SNE – time to sell some calls?


  19. loll phil we missed out wfr yesterday. i think u told me to remind u a little later in the day and i forgat.


  20. Oh woops!  "Monday is the start of hurricane season and we could see sky-high prices then"  This CNBC girl needs to get a grip!  Does she think that on Monday a dozen hurricanes will hit the US?

    EDU $70 calls in DTP at $2.25, 20 XXX  10 in $10KP and $25KP.


  21. MON – per my chart yesterday getting to lower highs, higher lows… this is VERY premature still but it’s breaking out of that trend to the upside… to my first post this morning it looks like any weakness in the dollar will keep helping the commodity / oil patch as an inflation hedge going forward (until the other shoe drops). 

    Here’s an updated chart of MON 6 month


  22. Things look a bit soft this morning.


  23. Phil,
    Should we take the profit and run on VZ?
    Thanks.


  24. SNE – Phil, are we covering with June $50 callers heading into the weekend?


  25. Go SNE!


  26. RIMM/GOOG – waiting for sentiment report in 20 mins.

    SNE – Absolutely!  $50 is a good gain, we’re done here, full cover.  XXX


  27. Closed My C trade ..were June 22.5 calls nice 20% profit


  28. Phil – FYI, I’ve had similar problems (comment box, refreshes time out, etc.) since the new website went live awhile ago. Running Windows / Firefox, all the latest stuff. I think someone said it had to do with the column layout or something at the top of the page. It’s been annoying as I have to use the permalinks now where I used to be able to just refresh the page. Happens in Internet Explorer as well…v6 and v7.


  29. 8:45 *U.S. MAY CHICAGO PURCHASERS INDEX AT 49.1 AFTER 48.3


  30. happy with WFR .. had JUL 70 calls long and JUN 70 short 1/1 and yesterday bougth 2X1 JUN 75 calls..


  31. WFR/Shahir – Oh well, can’t catch them all! 

    RIMM failing!

    VZ – Not taking profit as I REALLY like them as long as they hold $38.  If we get to $38, let’s set a tight stop on the bounce and get out but, for now, $38 is nice consolidation off the run from $37 just 3 days ago.  This is a VERY slow moving stock, you can’t jump in and out like you do with our tech pals.

    CY taking off now.

    C – out if they don’t hold $22.


  32. XOM ready for calls then we can play with MM at the end of the OEX?


  33. Phil,

    Refiners SUN and VLO not very strong today with the oil.

    XLF and C also not at best, with what strike would you cover C LEAPs?

    Thanks


  34. sox going up .. good news from MRVL.. INTC thinking if it goed to the Party.. those dumb ass delay rumours hurting it think


  35. OK INTC deicded go to PARTY :-)


  36. So much for RIMM failing, they broke below my $139.50 mark and right back up.  If they pop $140 we’re better off giving up and saving our firepower for GOOG.


  37. 8:55 *U.S. MAY REUTERS/MICHIGAN CONSUMER SENTIMENT INDEX AT 59.8


  38. FSLR – 14% below it’s 52-week high and 320% above it’s 52-week low.
    Hmmm. Should I be buying 270 PUTS here?


  39. EDU – offering to roll to $65s for $2.20 XXX

    C Leaps – I’m waiting on covering those for a real move.

    Michigan came in a little better than expected at 59.8 but that’s down from 62.6 in May. 

    INTC – good call rank. 

    GOOG went red.


  40. JBX is stock I get in and out of as well.  It has bounced b/w 23.5 and 28 over the past year.  Lightly traded though.


  41. G-Day.
    Phil – Ref C. Are taking out C from the LTP?


  42. EDU – Phil does the roll apply to the 10KP and do we have the margin for that?


  43. OK, my official position in FSLR fly is JUST the $260 puts, which I am rolling up to the $270 puts for $4 and I’ll hold that naked until FSRL drops $20 (maybe this afternoon!).


  44. EDU – Phil does the roll apply to the 10KP?



  45. Phil – Ref C. Thx for answer. My post was late.


  46. BA – what went wrong?


  47. HK- exploded all out.
    Hurricanes- already have one in the gulf.  LOL


  48. phil are u still in the xom u DD on yesterday at .55?


  49. BA
    There is a lot of concern every time an airline shuts down.  Also, comments from NOC CEO that they expect to retain the Tanker Deal.  June 19th is the GAO ruling day.
    I think all of this is BS.


  50. I think we can see the market manipulators progression.  For the last several years its been rent-a-rebel.  Now we are entering the rent a meteorologist, by winter it will be rent-a-astrologist.


  51. The Travel Industry Association, which commissioned the survey released Thursday, estimated that the 41 million forgone trips cost the travel industry $18.1 billion — including $9.4 billion to airlines and $5.6 billion to hotels. Plus, it cost federal, state and local authorities $4.2 billion in taxes in the past 12 months.www.cnn.com/2008/TRAVEL/05/30/airtravel.decline.ap/index.html


  52. EDU – Phil, what’s the skinny on that one? Lots of down pressure first 40 mins. What’s to keep them from testing 62 area again?


  53. BA – it plunged to $81 within seconds just now.  Yeah, might have been the NOC comments.  Well it’s back above $82 now.  Weird.


  54. Phil, thanks on WB. I am holding back from adding more banking stocks.
    S&P up a whopping 1 point and the VIX down 1? Don’t think I have ever seen this.


  55. GOOG/RIMM – those charts don’t look convincing out of the gate. RIMM already had some MA crossing. I’m hanging on those puts.


  56. DSL, a California S&L, continues to slide into the abyss….


  57. fabregas – looking at a 1 min tick, BA looks to have had someone put a market sweep sell out there… huge volume sold the price off… the only news is below, just someone wanting to get out and not caring about price (or not knowing how that would affect the market to be honest). 

    9:13 Deseret News: Bomber takes WWII vet down memory lane
    9:12 *AEROFLOT FLEET PLANNING HEAD SENATOROV COMMENTS ON DREAMLINERS
    9:12 *AEROFLOT SAYS DREAMLINERS TO COME MORE THAN 2 YEARS LATE
    9:12 *AEROFLOT SAYS BOEING TO DELAY DREAMLINER DELIVERIES    :AFLT RX
    9:02 *BOEING MAY DELAY DREAMLINER DELIVERIES TO AEROFLOT, IFX SAYS
    9:01 + CAE wins contracts for five full-flight simulators valued at


  58. Fab_gas Ref BA. I also don’t see on any “critical” feeds. I am provided with 45 feeds - no Blumberg though. Bollinger call this a “ head-fake”. It should be bullish. Hopefully some stop losses were triggered.

  59. MJ – VIX / SPX correlation… maybe b/c it isn’t a truly good correlation!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!


  60. EDU
    Earthquake impact larger than expected@SBSH – Citigroup believes the Sichan earthquake has had a greater impact on the company’s student enrollment growth than initially expected following recent channel checks. However, they expect a minimal impact on the current quarter and maintain a Buy rating.
    Piper Jaffray trimmed estimates too.
    I may buy some Jul’s instead.


  61. Drilling our way out of rising oil prices. Oil executives and some lawmakers believe it’s one of the only ways to help calm skyrocketing prices, but others say it takes us further away from a long term solution.


  62. I know Windy has the "gone fishing" sign up, but she must be mumbling something about GOOG right now.


  63. JOYG is going to make a nice short when it comes down.  Just a new version of FWLT for Cramer.

    SHLD – took out callers and rolling down.  July $85s make nice calls at $4.75.  XXX

    Funny how no one even comments on Apple’s daily $2 gain!

    JBX – I like them.

    EDU/Bigs – roll does not require margin.  Just cash and I love that play if we can get $2.25 (not so far).

    BA News:
    MOSCOW, May 30 (Reuters) – Russia’s largest airline Aeroflot (AFLT.MM: Quote, Profile, Research) expects U.S. Boeing (BA.N: Quote, Profile, Research) to delay delivery of 22 787 Dreamliners by over two years from the initially planned 2014, Aeroflot general director Valery Okulov said on Friday.

    "We have received official notification, the delay is 28 month," Okulov told reporters.

    That’s a tough one as it’s Reuters but the quote is Russian and I just said yesterday those guys will say almost anything you want them to but maybe not the CEO of Aeroflot.  The timing is very suspicious and it will be hard to get a denial from BA over the weekend as they would have to check with dozens of people internationally to see if anyone actually wrote a letter like that and, if so, why.  I sold 1/2 $80 callers so I  don’t really care but I think I’ll go to 3/4!  XXX


  64. I see Oil coming down a bit that will led into a nice rally


  65. Bronek – theflyonthewall has some story on BA at 10:02 , but I’m not a subscriber and don’t have access.


  66. 87,961 shares of GOOG @ $587.87 = $51.7M in one tick at 10:20ET.
    Now up to 588.92


  67. Sectors: Energy coming down, Materials "hanging"………. financials / tech / industrials taking off….


  68. Nibbling on SLB


  69. XOM – No, I got out at .70, just under even but I did just buy more at .45.

    BA – actually the timing of the release (10:17 am) is even more suspicious because it’s kind of late in Russia and it seems unlikely the CEO of Aeroflot is hanging out late on a Friday night in order to notify people of BA’s production delays and 28 months seems ridiculous so I’m sticking with the 1/2 covers.  XXX



  70. Mark are you on AIM or yahoo messenger


  71. dday – I’ll email ya


  72. goog/rimm – looks like I jinxed it at exactly 10:18.. Both charts popped the second I posted. So, Let’s try this: "oh look, they’re going up – I’m realliy going to sell my puts".


  73. if OIH can drop below 208, then it will break the march trendline. Or may be it is a buying opp at that price.


  74. GOOG – Well I got out yesteday in the belief that,  on the last Friday of the month and after its great run, people would take profits. Which is of course a sure sign that it will continue up all day :-)


  75. I’m buying GOOG 580 PUTS, Who’s with me? High FIve!…..Anyone?!


  76. Alf,I wonder why  those views are mutually exclusive..can’t the US drill for more oil while at the same time pursue alternative energy..supposedly the US has 15 years of proven petroleum  reserves..it doesn’t make any sense not to utitilize a portion of that while  researching solutions.


  77. Well, Peter, I am holding Jun 640′s and July 700′s, so I would have to say that I am not…


  78. Peter – dude, GOOG.  Do you really want to short that?  Not saying you should / shouldn’t… just asking why you think now’s a good time to short.  If you say b/c it’s up almost 10% since $540… is that a good reason (case in point, AAPL at $143 after hitting $130, $158 after hitting $143… etc).  Two completely different stocks and situations of course… but saying why is "something’s up X amount" a reason?)

    Hold, I think I just read your facetiousness… I’m retarded.  Happy trading :)


  79. Film- Looks like you might have to consider,  (gasp!),  looking at some cover. (Phil paid me to tell you that)


  80. On PCUs charts, would that not be a bullish engulfing trend for the last few days?   The Jun 110s might be a good play.


  81. EDU – I see nothing particular to them, they seem to be selling off with the sector, which is insane because their clients are 12,000 miles away from this economy.    EDU is a fantastic company that gets little coverage and I think the sell-off of the past two days is a huge opportunity to get in.  I already had the Jan $60s and took out 2 sets of callers already and, when it hit $66 I couldn’t bring myself to sell another caller so I decided it must be a buy instead.

    GOOG – followed through with plan to roll up at $5.50 per $10, now in $600 puts but that’s it.  If they break up I may sell $590s and roll back a month rather than quit but we’re still not making any impressive moves and the volume SUCKS so I’m not really into taking any losses based on these moves.

    VIX and Dow in "normal" 1:100 opposite ratio so I’d say this move is "good" so far but the data was not good and I can’t see people just holding this into the weekend but it’s the last day of the month so much of this may be window dressing as it’s been a tough year for the funds so they need things like AAPL and GOOG to make them look smart this month.  The Dow was down in Jan, down in Feb, up in March on the last day of trading from flat. up in April and as of yesterday, May was going to close right back at April’s open/March’s close and down about 250 for the month.

    C/EDU – Those guys are turning into the goon squad!  EDU said on Wednesday that the quake "would have no major financial impact on business."  Only the school right in Chendu was closed, it’s a huge company with 35 full schools and 135 learning centers around China.  Either they C analyst is an idiot or a hyena…  I would really like to get this guy under oath and find out what his "channel checks" in China constitute.

    MA looking liike a fun short up here.


  82. Phil:

    AAPL:
    I have calls
    oct155,
    oct 160
    oct 170,
    jan160,
    all covered with june 180,
    what is your thinking here ?
    aapl’s ATR is 5.6$, my positions are 18 to 33 ITM,
    would you roll to ??? get some $ back and buy more calls ?


  83. Film – Oh! forgot to tell you that I also have some longs SEP 590′s and 600′s

    and Yes. Mark. thank you for enjoying the humor. It makes my day when I can give someone a chuckle.


  84. Peter – GOOG – great short call!  ROFL.


  85. Phil:
    I asked  about FINANCIALS:
    XLF, AXP, C
    what is your projection ?
    looks I should at least go for 1/2 cover for these.


  86. ICE   anyone playing ICE?
    It has hit a 1 hour trendline along with resistance on the daily around the 140 area.   Any comments.


  87. BA – if you remember, i mentioned the 2 year delay couple of weeks ago. I got that info from a friend who works at a aerospace supplier, so i’m fairly sure its correct. They may not have announced it officially yet..


  88. Dillon shamelessly says oil acting well, acting well for who, speculators? what an asshole.


  89. Sinapore Steve-
    I have puts in ICE.  Actually, I have been playing them all week and reentered this morning.


  90. DB – Well you were still smarter than us as we went short based on the same logic!

    Drilling for more oil.  You guys do realize that "drilling for more oil" is just oil companies saying "Hey the government should sign over more land to us at ridiculously low prices so we can sit on it for 30 years while we whine that we would drill if only they would give us more tax breaks and we’ll spend Billions fighting any sort of legislation that says we should pay them more than a token cut of the revenues."  It’s a total crock – all part of the elaborate land grab engineered since the oil companies got together and made record contributions to Bush/Cheney in 2000 and then convened a "secret" meeting with Cheney right away, the records of which they refuse to disclose but were supposed to be about setting our nation’s energy policy.  Yeah, they set it all right!

    RMM – the June $180 callers are fine for now but I’d roll the Octobers up to the Jan $180s and take a little off the table (which you can use later to roll your caller up).  That gives you a better buffer if they sell off and, if Apple heads higher, then you gain value and have 3 more months to sell.   This is because I think a pullback is more likey than a breakout and you are deep in the money and pretty close in time.

    For the day today I think oil goes up and we finish flat at best but if oil breaks $130 we go down hard.  I don’t like the S&P back at 1,400, as I said yesterday that’s the big one to watch.  The NYSE blew 9,400 and the Dow is barely holding 12,650, let alone 12,700.  The financials are not participating at alland the SOX are up just 2% depite MRVL being up 22% – this is not a gung-ho bullish set of signals!  XXX

    XLF/BAC/C – I am holding all naked and waiting for a proper rally.

    ICE may go down hard on legislation.  The whole point to ICE is the lack of oversight, the whole exchange was started to avoid regulations, if they start regulating the ICE, there’s really no point to it.


  91. AAPL  My 5 Jun callers (185,195) are not keeping up with my 3 Oct calls (170).  Ah, time decay, you’re a beautiful thing!


  92. EDU – it has 38 schools, 181 learning centers.  Their website is not very well organized, but I think Chengdu has 5 (schools and/or learning centers).  I haven’t decided to buy Jun or Jul though…


  93. Phil – do you think AAPL would still pullback ahead of the Iphone 2.0 launch on June 9th? What could they base that on? Delays or you just thinking of a wider market pullback?


  94. BA
    The delays are old news and have already been announced.  It’s the same news being repeated over and over.  The initial deliveries are delayed to Air Nippon so what do you think happens to slot #2, tada…it’s also delayed.  When you are talking about Aeroflot deliveries that were in 2014 anyway it’s not news.  All this….I’ve got a friend talk is simply nonsense.


  95. phil,
    why don’t we have a cnbc sub-contest where the board members of your blog compete for the cnbc 1,000,000 portfolio contest?


  96. Global Insight Woman
    What a jerk….nothing fundamental to support oil at this level but oil is a strong buy.   These people don’t mind looking like complete idiots.


  97. BIDU  What about a 320/340/350/370 Iron Condor here?  14.50 credit/5.50 risk.  Break-even points 325.50 & 364.50?


  98. Phil:
    thanks for AAPL comment,
    rolling to Jan I like, But I am surprised about strike 180 ?


  99. Drilling for oil- All companies aren’t the same Phil.  There are many companies that are spending money looking for oil.


  100. wow – CROX going down sharply …. i had some september 10s – fully covered with Jun 10s. (Its just amazing how Phil has just taught us this AMAZING approach – Thanks Phil!)
    Anyone else in CROX – does it make sense to buy back covers or just let them decay for longer?


  101. RIMM – Phil did you close out the RIMM Puts?


  102. Phil, do we take out the CROX 11 caller here?


  103. Great commentary from Mauldin’s "Outside the Box" blog. Discusses implications of $130 oil and high food prices. Summary: Good for Russia, Great for Middle East (minus Iran), neutral for US (oil bad, food good), and really bad for China. Interesting views.


  104. Phil,
    You called GOOG resistance at 588 right on the nose yesterday…


  105. goog – c’mon stork, he was off by 0.2%.


  106. bbd
    Congrats on Lakers…nice comeback from first half.


  107. Katrina
    What they don’t tell you is there was really no supply disruption even with a 1 in 100 year hurricane.  Prices went up but there was no major shortage of gasoline, natural gas or heating oil. 
    This guy is talking Apocalypse….well that was Katrina and no major impact.


  108. im bored lol


  109. Morning Boys! Well I can’t stay, as I’m still working on my financial model.. But I did want to give my two cents.

    Re: Yesterday

    Film – That’s an interesting Theory. I’m just really surprised how we spun 9/11… The government chose people to be scared like it actually did something significant for the economy. It sucks for the people that died, but I don’t understand why America showed so much weakness from a building being blown up…. That building was also jinxed to begin with… The fires, the bombings, etc…

    http://en.wikipedia.org/wiki/World_Trade_Center
    http://en.wikipedia.org/wiki/Silverstein_Properties

    I don’t know why this wasn’t significant to anyone:

    In January 2001, Silverstein made a $3.2 billion bid for the lease to the World Trade Center

    Following the September 11, 2001 attacks, Silverstein sought to collect double the face amount of that coverage (~$7.1 billion) because, he contended, the two separate airplane strikes constituted two occurrences within the meaning of the policies

    Now this isn’t a conspiracy or anything, but the building just never made money. And Silverstein did clean a little.

    C’est La Vie.

    Stu (Re: JTF2) – You would think America would know who their teacher was. It would’ve been Delta Farce without us.

    JB – Aluminum U as in Aluminum University. I guess the nick should be called Carbon U, since we’re making a lot of planes out of fiber these days. Even though Flyboys don’t get much respect from the grunts… if I were to join the military, that would be it… I would love to fly an F22 (Or even the Russian Variant) or even an F15…

    I love the monster you’re building though. Turbo Props have a special place in my heart.


  110. GOOG intraday – sorry, don’t mean to be a party popper but $590 is resistance… R1 happened to be 588.1867 today but volume blasted right thru it.  Now it’s in an interesting position… momentum back to zero / slowing, bounced perfectly off the 200 ema… so 200 ema support until broken, R1 resistance again unti broken… let’s watch. 

    Only saying this to show how to read a chart………………… not trying to be an ass.  :)


  111. Interesting Obama info:
    Volcker is one of his earliest backers and advisors.


  112. Gotta head out for a meeting.
    Gotta see a guy about arranging some Hurricane Rebels for Monday!
    Nothing much moving right now so I’ll be back for the $20 drop on FSLR that Phil promised!
    Til then, please keep Bush from making any announcements.
    One last thing….
    Did you know when George W Bush was at Yale, he was asked what he thought about Roe versus Wade.
    He responded with " I dunno. Both are good ways to get across the lake!"


  113. Visa Intraday … Here’s what my Model Spit out if anyone’s interested…. It’s still a work in progress, but it’ll be fun to see how it plays out… And since everyone’s bullish on Visa, it’ll be nice to see if it works against the grain… If it doesn’t, then whatever.


  114. Phil- I have V Sep 70, sold Jun 75 against. My timing is off a bit with V, I’m good about being aggressive to roll my position down but haven’t been quite patient enough about waiting for bounces for my caller, so the position is holding steady at just below breakeven. Looking back I can see how a little more patience prior to each of my moves would have benefitted me, so my plan as of now is to touch this position less.

    That said, I was noticing that I can roll my Sep 70 to Dec 75 for a small credit, giving up 5 in position but buying myself 3 more months of premiums. It seems like a good idea, but need advice as I’m unsure whether it’s a good idea to act now, or wait another month or two.


  115. Mark, What does the FSLR chart look like to you for a short term trader? Tks


  116. damn, sorry about that extraneous stuff.


  117. Mark,
    Appreciate the "in-the-moment" chart reading seminars.  Really interesting to watch the movement.


  118. Mark/GOOG – awesome chart, thanks. I was on the fence until 40 mins after open when the buyers came in.


  119. CY worked out very well, done of course…

    I like Bloomberg, really sharp guy and totally on top of things in a crisis.  No BS, he just gives you an assessment as if he’s talking to an equal, unlike most politicians.

    AAPL pullback/Nav – Ah who can guess the form of a hyena attack?  Steve Jobs may visit a doctor for a check-up and they could say he had a heart attack or they can leak manufacturing delays from the 3G component provider or they can claim there are network incompatabilities or that they use a system that is banned in Europe…

    CNBC – I was going to do it but I forgot.  I think I lost intererst when someone said you couldn’t just bet it all on DUG.  I think it’s a fun idea to do a sub contest, maybe we should all register as PSW+Member name so we can all track each other on the board.

    The reason the analysts don’t mind looking like idiots is because no one remembers what they said last time.  Look at Cramer, he can have 3 different directions on the same stock in the same week and on Friday he’ll tell you how it was his pick of the week and people call in to tell him how great his pick was.  If that’s the kind of feedback system we have we shouldn’t be surprised at how bad the analysts are…

    I think there is this accepted fallacy that no one can predict the market which excuses the crap that passes for recommendations across the market.  The fact is that good analysis should get you to anwhere from 65 to 75% accuracy and people should be graded on performance and performance alone.  I think if you are giving advice you should have to register with some central database and have a number appear after your name so people know were you rank.  This whole industry needs the same radical overhaul it did when Blodget ran the .com scam but the difference is at least HE was held accountable – the only lesson learned from that was by the investment houses who now downplay their analysts names so they don’t lose one of their valuable tools when it hits the fan on them.

    BIDU condor – It’s a good play but too wild for the small portfolios.  I’m going to look for something we can set and forget to close the month.

    AAPL/RMM – The $180s are per the logic we discussed yesterday with picking GOOG strikes except, with the leap, you need to take into account the fact that you don’t want margin on your caller.  You are taking $8 off the table which you can use to roll down to the $160s if you get 4 chances to roll for $2.25 each on down moves or you can spend $2 to push your caller way up to the July $195s if things go well.

    BBD – I agree, there are some excellent E&P companies, many of them in China, Russia and Brazil though…

    CROX – Cool Nav!  Now if only I had followed my own advice as I left 1/2 uncovered!  Yes to taking out the CROX $11 callers, they are not doing us any good now.  No to taking out the $10 callers, .62 is still a good premium but maybe stop them out at $10.25.

    RIMM puts – not yet as the market looks weak but they are not making me happy.

    This is key for GOOG, double test at $588-$590, maybe 40 mins to play out. 

    LOL Mark – you don’t have to try to be an ass!  8-)

    Peter - I don’t think you should attribute Bush with false statements to make him look stupid… There are so many real ones that do the job just as well!


  120. ICE has heavy support around 138.  Agreed if it breaks that, adios.  I was hoping for a bounce to 145 to enter puts, doubt it will happen.

    WTC Insurance:  Well, we are fighting a "war" on terror, but 9/11 wasn’t an act of war as declared by Bush because then all the insurance coverages would have been voided.

    GOOG, I think it is consolidating nicely under a VERY important resistance level.  Same with AAPL. Both just ending a nice up week with a solid consolidation day.  Both ranges way under the ATR.  Hopefully no afternoon reversal….


  121. Almost every day I read a post here where I think the writer would benefit from reading "The Black Swan: The Impact of the Highly Improbable" by Nicholas Taleb. I have read just about every trading book that exists, I believe, and this is one that may change the way you think about trading, trading systems, financial models, other people, and life in general. This guy has a colossal ego, but if you can get past that he is a unique thinker and was a former ‘big’ trader, so many of his points are market-related.  In my opinion, there are very few unique thinkers in the world at any one time. Speaking of unique, you know how you catch a unique rabbit? Unique up on it!


  122. A possible reason for SUN weakness today.
    *DJ Sunoco Cut To Hold From Buy By Citigroup

    -MORE TO FOLLOW- Dow Jones Newswires
    05-30-08 0003ET
    Copyright -c- 2008 Dow Jones & Company, Inc.


  123. BBD – ANR (you’re gonna love this) is "worth" $400 ROFL.  Just an FYI.

    Jamie – FSLR – nice support at the 89… volume of course week now going into lunch time… that one can go either way when volume comes back.

    KeyserSoze / mck – man just saying :)   Anything could happen (example of course like when the volume bought the hell out of it at 10:15 EST).  But unti that happens it’s gonna follow it’s trend and regular S/R’s…  IMHO.


  124. FIG getting a pop!!


  125. lol yogi, I’ll give it ago. Thanks


  126. DM, that post was not directed at you, but with your analytical mind, I think you would really enjoy the book.


  127. SUN & Refiners
    The crack spreads have more than doubled in the past couple weeks and these are all near 52 week lows.  Keep in mind the cracks were still about 50% higher during this period last year but if you look at earnings projections for next quarter they are all well below last year.  Citigroup doesn’t have a clue about the refining sector.


  128. Phil – ROFL.  Touche.


  129. GE jan 25′s  very little premium


  130. V/K1 – yes, now you are all intrinsic.  Like I said to RMM about Apple, it’s only cash that you can lose on the downturn, it’s not doing you any particular good as being in the Sept $70 doesn’t help you collect any more premium than the Dec $75s does.  Also, think of it this way, you could do a roll to the Jan $75s (because they are more liquid) for a .60 credit and you can roll you $75 caller to the Sept $80s even which would put you back to the same spread (you are $5 lower than your caller) but with an extra month between you.  So you are taking the first leg of a move that, at worst, gives you an additional month for free.  Of course you don’t want to roll him now but seeing it’s there let’s you know it’s a good swap.

    With a caller that deep in the money, you may want to consider first rolling yourself to 2x the Sept $85s even and rolling the caller to 2x the July $85s, a little better than even or to the current $85s if you can bite the bullet on $3.50 as you are taking $11.60 of intrinsic value you do owe him and moving him into $3 of intrinsic value for $3.50.  It’s almost irrelevant what your calls are as you will simply reposition them again once you get his premium but it’s a nice out and the Sept $85s were $6+ at $81 so you are well covered for a dip.

    XOM getting hammered.

    GE – I love them down here.


  131. yogi – No worries I understand, thanks (really) though, the book looks extremely interesting.


  132. This is what I am looking at:

    AAPL’s Hourly Trendlines: http://i28.tinypic.com/w6wd1f.jpg 

    GOOG’s Daily Trendlines: http://i26.tinypic.com/iync7o.jpg


  133. APPL/GRMN Oh wow, someone should now officially be worried…  Original article here.  Gizmodo article here.
    The US Patent and Trademark Office has published today a 372-page document detailing every known and unknown aspect of the iPhone. As you can imagine, the most interesting bits of patent 20080122796 are the features never detailed before—like video conference, GPS, widget creator, and video recording. Apple secrecy often pushes USPTO patent publication to just mere days before the release of the actual product, to avoid the disclosure of new products or features. 
    • Communication Module
    Contact/Motion Module
    • Graphics Module
    • Text Input Module
    GPS Module
    Applications
    • Contacts Module
    • Telephone Module
    Video conference Module
    • E-mail Client Module
    • Instant messaging Module
    Blogging Module
    • Camera Module
    • Image Management Module
    • Video Player Module
    • Music Player Module
    • Browsing Module
    Widgets
    Weather
    Stocks
    Calculator
    Alarm Clock
    Dictionary
    User-created widget
    Widget Creator Module (Web clip?)
    Search Module


  134. VLO zooming and SUN just laying around..  TSO up and WNR down.

    FDG making new highs, mineral stocks on fire – that Cramer is one effective mofo!

    UNP and BNI making new highs so this is another big commodity rally with tech participation. 

    Good video may actually be a major catalyst for the IPhone.  T has a lot of dead bandwidth from a 10-year old project with Lucent where they thought they were going to have the next great video phone and that died a horrible death but they certainly have the backbone to support a massive roll-out there.


  135. Interesting, the gizmodo article was yanked just that quickly…


  136. Personally, I want to see the phone record all my phone calls.  That would be sweet.


  137. I was suppose to leave ages ago, but I do have to clear one thing up:
    Yogi – that last comment may have come off wrong… I’m not egocentric enough to assume things are always ref’d about me… I was laughing because of the rabbit joke, nothing else.
    I’m reading the summary: http://en.wikipedia.org/wiki/The_Black_Swan_(book)
    And it seems nick’s a very deep character.  Good find.


  138. FF – whatever the new one does you can almost be certain I’ll be in line to grab one – now where is my copy and paste??


  139. I will never understood all those stupid patents things the way you manage in USA … following the article KWan posted.. seems Apple "innvent" all the things it’s exposed..
    BTW as repost about android platform link .. fisr images at Google IO conf
    nice feature maps views turn with you in sync
    http://androidcommunity.com/first-live-images-of-fullscreen-android-demo-20080528


  140. I will go get a new one if we touch 210 next week.  Otherwise, I may wait a few weeks.  I prefer to pay for my AAPL toys with trading profits and right now I am trying to get my account back to its highs.  But, copy and paste better be in there.  Probably easy with more "gesture" commands now.


  141. UNP- Was at ATH yesterday when commodies were gettin hurt .
    IPI- Monday morning for those that want a little fun


  142. CFTC
    "We have confirmed we are extracting the most $s we can from the American people".  Now that we think we may have broken the economy with $130 we’ll announce an investigation.  Give me a break….been looking at this for 6 months.


  143. We can’t get into the details because we have none because we started our investigation yesterday.  LOL


  144. Well, actually, DM, most of the posts here ARE about you. In fact, we have installed a special filter on your computers to filter out most of our comments about you. What you see is only a tiny bit of the actual fascinating discussion.  This movie was modeled after you: http://en.wikipedia.org/wiki/The_Truman_Show


  145. AXP for LTP…I’m leaning towards the Jan 10 40 for my calls….waddayathink?


  146. Phil – Ref SIGM. I forgot that I had Jun22.5/Oct22.5 Call calendar. I have closed callers, Now I think to roll Oct 22.5 to Jul17.5 and sell Jun17.5 callers. Can you provide any better advice? Thx.


  147. GOOG / chart reading update.  As I said, no volume / news so just following trend (ma’s) and sticking to it’s pivots until volume / news come back. 

    GOOG 1 min

    GOOG 5 min


  148. Anyone,
    What is keeping FSLR up?  Is it time to short (again)?
    Thanks.


  149. EDU  Just opened an LTP position:  -Jun 70/+Jan 10 60s  net: $22.40.    howdido?


  150. howannoyingisittowritewithoutspaces?  :-)


  151. Hello Phil,
    I have a deteriorating spread in EDU.  I have Oct 55 basis $16 with Jun 75 from 3.  Big volume last 2 days down past trendline and support is scary.  Roll Jun 75 to 70 and leave the Oct 55?


  152. GOOG – volume, right after 1 EST again (new bracket, big boys coming back to play)… it ain’t easy being sleazy.  8)


  153. That 250 gallons of oil sitting in my garage is up over 100% since I bought it. It’s a tough way to invest in commodities, but it is one way to do it!

    [for those on this board that know me, it's the glycerin by-product of the transesterification process I am after and not the methyl alkyl ester (biodiesel), which is worth $20-40 PER POUND in my calculations.....]


  154. Malai, Re FSLR as per Mark, the stock is hugging the 89 at the moment, volume looks like it is just coming in again, with a slight negative bias, so I reinstated my puts a little while back. JMHO Good Luck


  155. Phil:

    sold my AAPL calls 155, 160, 170,  and have buy order for call Jan180, the roll is on.
    of course I have the june callers at 180..

    Buying more at this price is not attractive, will only do so after a drop.


  156. Mark/Goog – thanks for the updates chief. Do you ever watch macd 3,10,1 on 5min chart? Divergence from price movement often means price will switch. Works pretty well on indexes.


  157. well if CNBC is interviewing CFTC chairman, then it is easy to guess that he will say ‘there is absolutely no speculation in crude it is all about the growing demand from China and India’. These bastards are not tired of repeating the same non-sense every hour. Today I guess it is the hurricanes, glad they did not mention the University of Colarado’s predictions. Don’t if it is out already this year. May be they will be predict we will have 1 hurricane per day this season :-)


  158. Hey Mark, what kind of money flow indicators do you have on GOOG?

    I know all my posts are about DM…

    AXP/Eph – I like them down here.

    SIGM/Bro – It’s a good set if you keep stops on the Junes but I don’t think these guys are bouncing back very quickly.

    FSLR – it’s always time to short them.  We’re already naked short but the $260s could be fun.

    EDU – I’m not seling against them obviously.  Be careful with callers.


  159. I just assumed half the people on this board were DM aliases.  Sometimes DM doesn’t post for 5 minutes, but 10 other people post.  Coincidence?


  160. Looks like R2′s are on order for GOOG/AAPL.


  161. Andrew- always like your buddy Phil, very clearcut and on point.


  162. DM- I miss the days when he had over 200 posts.  NOT LOL


  163. CNBC Idiots now out saying that high oil/gas/diesel prices are GOOD for the US and the economy. Spluh.


  164. Phil – that’s an excellent question and the best answer I have is my eyes unfortunately.  Also the knowledge of when big boys come back to play (30 min time brackets for floor pit traders).  So 1 EST almost on the dot you can see charts that look like GOOG every day having money come back to play (since money played big that morning).  More just "feel" unfortunately… can’t explain that.  When volume’s gone the Pivots / MA’s tell me where it’s headed… b/c trader mentality is not to break the trend ever… so when volume comes back it puts a "kink" in the line and can change everyone’s attitude. 

    FSLR volume still "small" but getting bigger… let’s see where it wants price.  AAPL been bending it’s 89 the last 3 hours…


  165. BBD – CLF – PE*EPS = "$278"


  166. That is an interesting observation, Mark.  I guess that makes sense.  "When volume’s gone the Pivots / MA’s tell me where it’s headed…"


  167. arite guys im heading out for prayers. i think i might just pray for volume


  168. BBD – I’ll call you later tonight.  On my spreadsheet I’m simply taking public info (Price / Earnings * Avg Estimated Earnings / Share to = Price / Share for the future).

    FILM – thanks man.  I guess it’s like you’re on a ship, and the waters are all calm.  Then a HUGE wave comes in and you have to compensate and follow the wave… but then it turns into a whirlpool!  Then you need to break out the ores and paddle your way back to the calm waters… until the next wave or whilpool… or until the NEWS that a hurricane is coming then you need to quickly get in / out of the waters (depending on where you are).  Sort of how I see it… everyone likes calm waters if you’re long only… it’s the waves and whirlpools that get people moving to stay afloat…


  169. MJ
    University of Colorado hurricane study was discussed earlier today.


  170. There was no logic to that XOM sell-off. 

    EDU/Jugo – I would just take out the caller and wait.  You know theyr’e worth more than this so give people a few days to figure it out.

    That’s great BDC.  I can’t wait for April Fool’s day when I can tip the police off to your meth lab!  8-)

    CTFC – It doesn’t matter what this group says, now that the laws are changing an appointment here and a directive there and by the time Obam has his first 100 days oil will be back at $70.


  171. Meth cooks are getting the propane tanks from the exchanges at Wal-Mart, Kroger, Lowes, etc. and emptying them of the propane.  Then they are filling them with anhydrous ammonia (which they now have a recipe for by the way).  After they are finished with the cylinders, they return them to the store.  They are then refilled with propane and sent back for you and me to buy.  Anhydrous ammonia is very corrosive and weakens the structure of the tank.  It can be very dangerous when mixed with propane and hooked up to our grills, etc.
    According to the National Propane Gas Association, you should inspect the propane tank for any blue or greenish residue around the valve areas.  If it is present, refuse to purchase that one.
    Check the following website for more details and pictures.
    http://www.npga.org/i4a/pages/index.cfm?pageid=529


  172. Mark – Ref VZ. You are the guru of the trading by the minute. If you would decide to get out from Verizon’s calls today, what price level would you set as a target? Calls follows this underlying very closely. Thx.


  173. Anyone notice a HUGE spike in calls bought?  The ISEE Index shows 1 million calls purchased between 12:50 and 1:10 taking the days total to 1.2 million from .2 million.


  174. Mark, I will field that one.  "Dude, I can’t answer that."


  175. Bronek – sorry, can’t give advice like that (in fact I prob need to be more careful about giving my "things are "worth"" comments).  I can show you charts though and you can make your own conclusions!  :)   See any resistance any time today?……….

    VZ 1 min

    VZ 5 min


  176. mck – btw, I don’t have a 3/10/1 on a 5 min, but a 4/15/11.  I’ll try out the 3/10/1 and see what happens thanks!


  177. Hmmm  last trading day of the month, and it is a Friday too.  Any predictions into the close?


  178. Mark – Thx. I try to phrase “what would you do?”, but I appreciate and I am thankful for your comments.


  179. LOL Mike, you know way too much about that stuff!

    Well, we made it through lunch and now we just have to make it past the NYMEX close (oil at $128) without hitting $130.  I see HES and CVX picking up, waiting for XOM to do the same but their chart doesn’t look too healthy for today. 

    GOOG is holding $588 amazingly well but finally breaking down a bit, can’t afford to be greedy in DTP, we should be happy to get even at this point.  Same with RIMM as cash is good for the weekend.  XXX


  180. FILM – LOL.  I need to have one of those disclaimers like the bottom of my emails:  "…It is not intended as an offer or solicitation for the purchase or sale of any financial instrument…"


  181. Out of DELL puts, nice little DT gain. (bought on the opening spike). 
    Now if only my RIMM puts behaved..


  182. Film – Wow, an ISEE of 688 @ 13:10. Never seen that before.


  183. Phil:
    I have rolled my calls oct to jan180, all done,

    except:

    my LEAP AAPL jan 160: is this also good for a roll?


  184. Film – which option?


  185. Ok, I gotta run, try to keep the markets up while I am out, okay.  Thanks.


  186. BDC, it is "all" equity options.  I don’t know if it is truly all, but it is a large swath of the market.  Got to http://www.ise.com and click on ISEE Index on the left had side.  The volume wasn’t in ETF’s and Indexes, so it had to land somewhere.


  187. dang it got busy but GOOG doing something it hasn’t done all day… failing it’s ma’s……. let’s see where the action goes and if support can be found……


  188. MikeE – are you in law enforcement?


  189. Greg – you still long SIMG?


  190. orion/dell – nice job, I didn’t think that would work out today, cool.


  191. Phil
    Full covers for the weekend?


  192. mark/goog – was drifting, now the seabreeze is kicking in. It poked 200 once earlier but not for more than a minute or two. Sticking under 200 for now.


  193. Mark – Still long SIMG, have DEC $7.50s, up 40% currently.  Looking strong while every thing else took a dip the last two weeks. 
    I am also long a few USU 2010 $5s, 7.5s & 10s, with a chart pattern that is starting to look similar to SIMG.  What is your take on the USU chart?
    PS I bought Mind over Markets and got as far a page 16 so far, it is not an easy read for me, but I have the brainpower of your average NASCAR fan.


  194. greg – I’ve been waiting 2+ weeks for amazon to get that book back in stock so they can send it over already.  I’m this close to buying it used.



  195. Kwan – Amazon should send Mark a commission check, and so should the author.


  196. I don’t know if this was posted before, but I can’t stop laughing…
    Stimulus Package (youtube)


  197. Kwan,
    I got mine at http://www.traderspress.com Arrived in about 3 days. I’ve been through it once and starting a second time. I must have that NASCAR thing going on also.


  198. MOM – ha!  Man Greg like I’ve stated multiple times, it’s not easy to read.  In fact it’s exhaustingly dry / dull in some parts… but it hammers home how the market is structured / looked at by those who control it (the trading of it I should say).  Dull… but important.  Accounting’s dull too… but important.  :(

    USU?  Def a similar chart but it looks like it’s 8 or so months lagging SIMG.  Don’t know a thing about the company, so that last statement means almost nothing really (just similar charts, but don’t know if there’s any true lagging correlation to their price action).  At this moment it’s above it’s 50 dma and headed to it’s 200 dma.  Decent volume supported it back on it’s Low made in March and decent volume gave it some needed umph in April… 200 dma is next big test and 50 dma is support until broken.


  199. Bert Pretty funny stimulus package. Your right, could not stop laughing. Thanks.


  200. EDU – Phil, did you get a roll to 65 or would you roll to 60 now, price is 65.70 now, off 5.5%


  201. RMM/AAPL – As it’s looking very strong and you are very well protected, there is no need to roll those.  They do give you better leverage if it breaks up.  I’d wait until you find it necessary to roll up the caller, then they will be a good source of cash.

    NYMEX can’t even make $128 at the close so far.

    Weekend – Yes full covers but for me that includes some open calls against my DIA puts, but they are naked. 

    I’m trying to think of why GOOG will break $600 and I’m not sure I see it happening.  It may be a huge risk but I’m not selling my puts unless I can get out even today (which would be my preference).

    RIMM I am more confident will turn down.  Aside from the low volume, this whole rally doesn’t feel right so I’m going with the window dressing theory into the weekend.

    Oil looks like it’s closing under $127.50, up a bit for the day but nicely down off the highs and down $5 for the week.

    SUN is finally perking up about it!


  202. what’s up with WFR any news .. ???


  203. mck – 2:14… yeah man agreed… just hanging for now, like someone mentioned earlier on a Friday (that’s month end and the same day the MSCI is re-balanced FYI). 

    I wonder if traders will unravel / hedge their bets going into the weekend in the last 30 min of the day…..??????


  204. Phil,  do you think we should DD on EDU?


  205. PHIL-BA – I have the Jul 85′s  -   Given that I am OTM, I am not sure how to cover it for a 1/2 or 3/4 cover.  How should I think about covers when I hold OTM calls 1 or more months out ?


  206. Phil:

    I had asked about financilas: they are at a bottom, would you still cover these ?


  207. Phil,

    Full cover also on C XLF LEAPs?

    The SUN calls in the 10K we aren´t full-covering.

    I have the VLO Sep50 calls at 4.25$ now at 4.95$. Would you take the gain or full cover with the Jun50? Do you see any resistance points?

    Thanks


  208. RMM – See Phil’s post @ 9:58am on C


  209. Oil- who cares  CLR and HK  are the ticket


  210. Instrument Engineer with URS Corp Process & Energy Group in New Orleans.  I received the propane cylinder story from our safety warden this morning.  When Phil wrote about Meth Labs, I posted it here.  When he wrote back that I knew too much, I thought "Water off a duck’s back".


  211. designcurve:
    txs,

    what about AXP and XLF ??


  212. I was suppose to place a LOL at  the end Sorry


  213. Phil,roll the RIMM Jun135 puts to 140 or write it off?


  214. EDU – yes I got the roll, there is no news supporting this. I’m very surprised by this move and I really don’t think it’s deserved.   They ran up from $50 in Jan to $80 and now a 50% retrace so it’s a glass half full/half empty kind of thing.  I’m choosing to see them as half full!

    WFR – looks like we’ll get our chance again.  Stocks are trading all over the place, I can’t see assigning much meaning to it. 

    EDU – no DD, it’s just a spike down, we need to see what’s happening after the weekend.

    BA/Doug – As you’re in July a cover there is too dangerous.  I think they are going to break up but you could roll back to the Aug $85s for $1 and sell the June $85s for $1, that’s a good combo.

    Someone is determined to close the markets green today.  It does leave the door open for a major last minute sell-off if someone else wants to take advantage…

    Financials/RMM/Alex – No I haven’t changed my mind in the last 2 hours but ask me again in two more hours.   8-)

    SUN $10KP – no cover!  On VLO I would leave it too, they are closing at the 5% rule and gas prices are going up and oil prices are going down.  I may not be too good at math but that sounds like it might be good for someone in the refining business…

    RIMM puts.  I’m standing pat by now.  I’m in enough pain from GOOG that I don’t want to make it a two-fer.


  215. mark/goog – still drifting. this may mark a break in increasing volume on this run up, we’re only about half yesterday’s now (2.3 now versus 4.8 last session). Think it’s quite possible traders would take $ off the table after that pop. Will be an interesting last hour.


  216. MA coming down nicely, V following too.


  217. phil — what do you think of the financials here?
    also, i’m thinking of having a dos equis with my bacon double cheeseburger, but there’s a special on corona and heineken.  what should i buy?


  218. Thanks Stevey!  Nice site…I’ll probably cancel my amazon order if it arrived to you that quickly.


  219. INTC quite dogy today .. absolutelly underperforming $SOX


  220. Phil,

    Thanks for your knowledge, I´m now getting a little behind of a little market physics.

    Like you said on tuesday take covers off on VLO(How do you decided it??? on What indicator??? Thanks), I didn´t know why so I left it because my VLO Sep50/Jun50 were good on my Track, but then Thursday I realized that my covers are gaining and I took it off with still a little gain(But not that nice gain like you had on tuesday).
    Then I would DD on VLO but I believed not much enough for it so I left it at 5 contracts.

    If I ever get behind all the market things who you know, I´m very pleasured.
    I have only 5 Years of work to get behind it and I think I can do it.

    Thanks much for now


  221. phil/AAPL- keeping the 180s short? im interested in knowing ur thinking/expectations on the iphone revamp and how u plan to position/trade the price action (flying up, dropping down or staying flat)

    thanks


  222. 6fingerman- i had a "el pacifico" the other day at a mexican place- pretty good.


  223. man RL so strong!!  amazing with JCG,  JCP, CROX doing terribly….


  224. AAPL- I have a rookie friend that has 5 June 150′s calls.  I don’t even know what to roll them up to.  Phil can you help out


  225. XIAN – bought a 6 pack of pacifico last night, had a couple… my favorite Mexican beer.  very tastey.


  226. Concern re VLO & SUN
    Remember Demand Destruction?  Remember Refinery Utilization?  Consumers are forcing the price of gasoline to narrow crack spreads.  CFTC is investigating Crude Price Fixing but,they are Bush appointees aren’t they?  Hurricane season = 1Jun -> 30Nov – drive crude oil price up?  Remember Colo St Univ William Gray report?


  227. Goog/Phil – I figured 600 was max for this runnup (hi from 2-3 wks prior) and then it was headed back to bottom of the channel. I think your 588 plan was the best, maybe just pulled the trigger a bit early. Regarding the weekend, while I might not necessarily be buying those puts now, I could be talked into it after todays lack of conviction, so I’ll probably hold out for even or better. I think Mark’s suggestion about last 30 mins will come into play.


  228. Phil:
    I see your comment to Doug on BA: you think they are going to drop ? why ?
    I have 1/2 cover at jun80, base 3.2$,
    I plan to sell the other 1/2 cover today  at jun85 for 1$, you approve ?

    ENERGY: what do you see for energy next week ?
    I need to consider covers for my energy positions such as HK,, EOG, FTO, HAL, SLB,PBR,VLO,
    if bearish/oil going up : COVER,


  229. GOOG / AAPL = volume "whirlpool"… COVER!!!   ROFL.


  230. Bill…if that’s all he’s got, there’s nothing wrong with cashing them


  231. Looks like some sell program kicked on at 20 minutes after the hour.


  232. On the June AAPL’s, i’d cash 2 or 3 and hold the remaining till June 9th. Then sell into excitement..


  233. mark- sweet. i hadnt tried them until wed night and i was happily surprised w/ them b/c they $1.75/bottle and poured into a frosty mug- great deal.

    we were eating, but whatever. still good stuff. cheers!


  234. Bear close ..


  235. AAPL- disreqard the question Phil it was a typo by her.    Rimm not liking it is Friday LOL


  236. Mark,
    Looking at the ESM8 5 min chart. At about 11:30 the volume dropped off a cliff. Is this when the floor trades packed it up for the weekend, leaving the retail folks to play the remainder of the day?


  237. EDU/Phil – thanks for the followup info on EDU, interesting for sure.


  238. Have VLO Sept 45 fully covered with June.  Should I roll up or take out some of my callers. 
    Thanks


  239. That should be floor traders.


  240. 6finger, lol. Corona of course.


  241. Hey Stevey – no the floor’s still there until the market closes… the big boys give their orders the first 1.5 hours of the day and the floor executes.  Then they move to bonds during lunch as a hedge (and the doctors / lawyers play with the junior traders for a couple hours).  Then the volume picks up the last 1-2 hours of the day and that’s the big boys coming back to finish their hedges.  Remember, the way Phil uses DIA options to hedge his individual stock option positions, so does the big boys of the world use the futures market to hedge their longs (or shorts).  Make sense?


  242. I am out of BA & VZ calls, so be aware that now they may gap-up in moment.


  243. PHIL BA – That was a nice adjustment you gave me thanks.   I am not sure I fully understand why you called covering the July’s as dangerous.  Could you elaborate a little on this ….  or is this in the K1-Documentation somewhere …..  thanks


  244. Thanks


  245. BTW. Thx Phil. BA +20%; VZ >+45%. (I had ½ pos in both, but S/T gain is better than L/T loss).


  246. ah, yogi.  can always count on you for sage advice.


  247. Speaking of floor traders, in that book "Black Swan", the author says the floor traders refer to the Durable Goods number as the "Doable Girls" number. I thought that was funny, but my wife gave me "the look" when I told her.


  248. HK- stop going up.  LOL


  249. billbigd:

    do you think I should  cover 1/2 of my HK ????


  250. Stevey – you’ll have to pardon me, I’m sure quite a few left their clerks (juniors… whatever) there on a Friday to end the day knowing where their levels are.  That’s why volume was so much greater this morning vs right now… those boys are in the Hamptons fo shiz right now ;)

    I guess a 1400 close into the weekend / end of month?!  hmmm….


  251. Note for next week –  CREE is at 25 now, and the weekly chart looks like it is going back up —it makes trips between 25 and 35 
    -- someday I assume it will break out of 35


  252. FSLR – good dog!

    6finger – Yeah I have just one finger for you…

    Alex – as I keep saying, you need to go into a trade with goals and when you get near your goals (caller down 45%) you need to not be greedy and take what you can.  Like CY this morning, I might have gotten out a little early but I made my money and I moved on.  Yesterday we made a nice gain on the FSLR $280 callers we sold so we bought them out….  There’s nothing ingenious about it, just having a target and sticking to it rather than constantly changing my mind and trying to squeeze more out of every trade.  In short trades I’ll press a loss and try to turn it to at least even but that means I’d damn well better be taking winners off the table to fund it.

    IPhone/Xian – I’m pretty sure I just went through a whole Apple trading strategy with RMM.  What do you think is going to happen?  Are people going to go "Wow, an IPhone, now I have a reason to buy Apple!"?  I look at it as 25% chance of upside surprise, 25% chance of disappointment and 50% chance of nothing.  Since my $180 callers have $4 in premium, that 75% down or flat works just fine with me.

    AAPL/BBD – I’d go 10 July $190s at $11 and sell 5 June $190s for $6.70.  That takes $31 of $39 off the table with maybe $5 less upside than he has now.  If he went 20/10 he’d have more upside taking $24 of $39 off the table.

    Hurrricane season has more effect on gasoline than oil as most oil comes from overseas and our US production is fairly dispersed but most refiners are in the gulf.  Demand destruction not as big a deal for refiners who were losing money selling 10M barrels at $3.85 but will make money selling 9Mb at $4.25.

    BA/RMM – I didn’t say they would drop did I?  I hope not, I’m only 1/2 covered.  We were worried about that story this morning but I decided it was BS.   Energy – I see things happening, then some stuff and then a move that will surprise people.

    VLO/Mike – I’d go at least 1/3 naked.

    BA/Doug – If you take a less than 3 month calendar spread your caller can gain faster than you do, then you buy them out and it drops and you are screwed.  Always give yourself room to roll.


  253. yogi – heh, I got "the look" today when viewing the stimulus package video shared earlier today.


  254. I can’t wait to watch scotty on the daily show monday
    for reference here’s his Jan 2007 appearance.


  255. A lot of the Doable Girls are Durable and Good


  256. MikeE – LOL! :)


  257. I’m back!
    What did I miss?………..HOLY CRAP! Should have taken those GOOG puts this morning!
    FSLR – happily accomodating us with a $10 drop so far. Thank you.
    DB- re: your 10:38 post. You were right about GOOG. You were just a little early, that’s all.
    MARK – Any recommendations?!!!!! (insert smiley face here)


  258. speaking of doable, if tradinggoddess looks anything like the pics she posts….


  259. If you look back on Google’s last 4 or 5 Friday closes and Monday opens, the odds favor holdiing puts over the weekend but I won’t sleep well on it.


  260. Anyone playing the Rails, meeting with CFO on BNI.  Any questions for me to ask


  261. Phil
    Your not alone!!


  262. goog/rimm – both may finish flat, no conviction. those goog puts will only drop about 1.50 over the weekend (I think) so I’m not going to sweat holding them. Same with rimm. cross my fingers for an opportunity to kill them monday.


  263. GOOG – crazy looking chart to end the week… spikes all over.  let’s see if they bring it back to $588 or back to $584 volume gap this morning.

    FSLR – not wanting to break it’s R2 to the downside… fun week.


  264. Phil -
    Sorry for the redundant comment on FSLR – My refresh finger was on loan to 6fingerman!


  265. Phil:

    on BA you said: I think they are going to break up,
    I interpreted this: drop,

    I am also 1/2 covered.

    Txs

    Have nice weekend.


  266. phil,
    i’m assuming the finger you mean is your thumb pointing up, like the fonz in happy days
    don’t get your point about GOOG.  4 of the last 5 mondays (or tuesday for this week) were green.  unless you’re going contrarian.


  267. Well it appears I will finish with another winning week.  My new mantra, "Make more money and be less stupid", is working!

    Taking a longer perspective, doing longer term adjustments and cutting out the daytrading is also helping.


  268. Phil:

    do you ever put a stop on a caller or putter ?
    or just watch and then decide ?


  269. GOOG – they decided to leave it in the middle LOL.  What a day.  FSLR opens above all R’s and stays above until a close "right at" it’s R2 for the day.  AAPL strends up all day until R2 and never says high again.  AAPL and GOOG volume both anemic today compared to 6 month daily chart. 

    Alright I’m out have a great weekend everyone.  Very fun. 

    Phil, as always, thanks for providing such a great place to hang out.  It’s like my favorite bar… sans alcohol of course (well on teh weekends that’s a different story LOL). 

    Peas.


  270. Oh, and my SPX close of 1400 was a little off… ;)


  271. Thanks for you help/advise. Have a good weekend. Interesting week and should be exciting next. Great job as always.


  272. Yes Phil, a plan is good, but if we have a play like VLO this week what indicates that we are willing to take the caller of the table? We don´t know that tomorrow VLO takes off, or do we? The only plan is to take the callers off with a gain of 50%. but what is when the Stock goes down further? Or is it rarely that our stocks we believe in tumbling down the next days 10%?

    Do you look at the world markets to decide: take the caller off or not?
    I also don´t know why you took the FSLR caller off yesterday? Was it only because you believed in that FSLR bounces at 250$?

    When I did knew that it were much easier to decide.

    Thanks and have a nice Weekend all.

    Was this just profittaking before the weekend?


  273. Market close – You nailed it, Phil. Just wish it had happened a little earlier. Was able to exit some DIA puts at even to get back to 100% cash, but in the frenzy I was a wee bit off the best price.


  274. Have a great weekend everyone! (That means you, DM)


  275. Peter – funny, was that a play on the DM alias comment earlier? I’ll be pissed if it turns out I’m in here with one other guy and a pile of aliases. :)


  276. Have a great weekend all!!  And good luck DM!!


  277. CFO/BNI – Yeah, ask them what they’re going to post for Q2 earnings!  I guess my main interest from those guys is how are the margins holding up and what’s the increase in volume capacity, if we can get those two pieces we can figure out the earnings.

    GOOG/Mondays – not where they finish the Monday but where they close vs. the opening hours on Monday, usually they sell daow.  This Tuesday was their best one but that was the start of the $40 rally we’re looking for the retrace on.  I’m just looking for $575 but I’ll be happy to take $580 at this point.  Notice GOOG is up about $25 for the month after that $40 run – I’m thinking it’s forced and $588 is strong 5% rule resistance so we should get at least a pullback to $580 (20% of recent run) and I’m more concerned about a big down move than an up move so I’m also protecting my long calls.

    Good going Grant!  It was a tough week too…

    Stops – I have mental stops but I don’t often use hard stops.

    Alex – You are cutting into my cocktail hour, happy to discuss later on the weekend but the general answer is – it depends on each situation.

    Have a good weekend DM, er I mean everybody!


  278. This is why EDU down $10 in two days?  Back to price before earnings.
    http://biz.yahoo.com/ap/080530/asia_adrs_in_focus.html?.v=1
    NEW YORK (AP) — A number of analysts said Friday they expect the Beijing Olympics to disrupt operations for New Oriental Education & Technology Group, a Beijing-based provider of private educational services in China.
    Meanwhile, Citi Investment Research analyst Catherine Leung expects the Sichuan earthquake to have a greater-than-expected impact, along with the Olympics, specifically because of class schedules in Beijing, school openings and dorm facilities.
    "Student enrollments across the country have softened noticeably since the quakes, especially during the mourning period, as many students and the broader community have focused their time and resources on quake relief efforts," Leung wrote in a client note.
    Leung said the earthquakes haven’t significantly affected profit and sales in the fiscal fourth quarter, which ends in May, but expects the effect to show up in first-quarter revenue, as some students deferred enrollment.


  279. boo hahahaha.  Got an email from my buddy who sent me this link.  this is VERY INAPPROPRIATE… so don’t open at work (and sorry if it offends anyone).  But his quote in the email says it all:

    "I’m seriously laughing out loud at this crap. I love the idea that someone’s spending all this time in MS Paint."


  280. EDU
    NEW YORK, May 21 (Reuters) – New Oriental Education and Technology Group Inc (EDU.N: Quote, Profile, Research) said on Wednesday that the May 12 earthquake in Sichuan province has not had any "major" financial impact on the education company’s business.

    The company, which specializes in English-language instruction and exam preparation in China, said its school in provincial capital Chengdu has been temporarily closed until power and transportation services have been restored, company spokeswoman Ceren Wende said.

    The Chengdu operations account for 1.5 percent of the company’s revenue, Wende said. (Reporting by Helen Chernikoff; Editing by Brian Moss)

    So maybe a .5% hit in their revenue which will be less in earnings.  This analyst really like to spin it.  They must have shorted before they announced.


  281. Mark, Aren’t you meant to be bending an elbow at that Dallas Pub???


  282. Jamie,
    At the risk of sounding inappropriate, myself. ….. I think the expression "bending an elbow" to a man who just viewed Mark’s link may be misconscrewed…I mean…misconstrued!!!!
    Mark – LOL.  I love this stuff. Gonna have to keep it away from the kiddies and the MRS.
    On second thought, I think the MRS would get a kick out of this, too!!!
    DM- Anybody we know in the pictures?


  283. Peter- nobody personally, but the chick being saved by Superman looks an awful lot like Kari Byron of Mythbusters fame.


  284. Jamie / Peter – ha LOL!  No last night went to dinner with the Mrs.  Her B-day’s today (she’s one week younger than I)… so we did bend some elbows on a whole bottle of Byron Neilson Pinot Noir :)   Luckily we’re small people and have leftovers…. steak and eggs will be breakfasst this morning… mmmmm…..

    Yep, I hesitated to post that link b/c it is racy…  but the humor and time that went into it is something I just couldn’t pass up sharing.  It’s like a 4 year old decided to take disgusting pictures and draw on them to give ‘em a much more Saturday morning cartoon PG rating.  Funny… and disturbing fo understanding what’s being hidden.  :D

    K1 – uncanny ain’t it?  Agreed….


  285.  Vladimir Putin: "Expanding NATO is building new Berlin Walls"

    Your dinner with Nicolas Sarkozy on Thursday night, reveals an ambiguity: who is leading Russian foreign policy? Vous, ou Dmitri Medvedev ? You or Dmitri Medvedev?
    There is no ambiguity. We became acquainted with Mr. Sarkozy, when I was still president. Some friendships were forged. The humble servant that I will above all deal with economic and social issues. As a member of the Security Council of Russia, I am also concerned with other matters dealt with the french president. As for the distribution of powers in Russia, the President has without a doubt the last word. Et le président, aujourd’hui, c’est M. And the president today is Mr. Medvedev.


  286. Do you think that Iran is trying to acquire nuclear bomb?

    I think not. Nothing indicates. The Iranians are a proud people. They want to enjoy their independence and use their legitimate right to civilian nuclear energy. I am formal on a legal level, Iran has not breached at this time. He even the right to enrich [uranium].  The documents say.  It accuses Iran does not have revealed all its programmes to the IAEA [International Atomic Energy Agency]. This issue remains unresolved. (…)  I have always said openly to our Iranian partners that their country was not in a sanitized area, but in a volatile region.  We ask them to take them into account, not to irritate their neighbours or the international community, to prove that they have no ulterior motives. (…)


  287. Hey Peter, The Mark we know would only bend an elbow at a pub with a good ALE. Give the poor guy a break!!!
    By the way, weekends with no business news are a bummer.


  288. v putin

    I will make another remark: Democracy is power of the people. In Ukraine, nearly 80% of the population is opposed to joining NATO. Our partners say, however, that enter the country. It is therefore decides in advance, instead of Ukraine. The public opinion is no longer person? That’s democracy?


  289. RIMM
    Is RIMM looking like it is setting up a head and shoulder pattern?  if it fails to make a higher high it could be a better short.
    Also if anyone is interested I am searching through cal call spreads with for Jun and Sept/Oct long positions with and without earnings in June and also stocks trending above their 20 MA.    And ones that your caller will pay about 25 to 30% in the first month.


  290. Phil
    Was looking back at the GOOG example you gave the other day on using OTM front calls for day trading.   I was back testing some of this and notice a few common themes.  On a stock that is $150 dollars you almost always triple your gains on strikes that are 3-4 OTM vs double when it is ATM and only and less 80% when DITM.  ie if the stock moves $10.  Plus the downside risk is is just the opposite effect.   So is there some point in time to expiration that one would not want to day trade front month calls?  For swing trading for 2-6 days maybe the second month out might be safer but I observed that instead of a 3x gain you only get about a 2x gain on strikes 3-4 OTM on a 10 dollar move but your downside risk is only 50%.  So for the second month out your gains are not as great but your losses are less.   Overall from your experience do you find this to be true?    Most the stuff that I have read or have been tuaght would tell me to buy ATM or ITM options but the facts seem to say the opposite.   If you could comment further your wisdom would be appreciated.


  291. Phil
    On EDU, we are holding the JUN 65 in DTP currently $3.30.  The stock is 65.75.  If we do not get a pop in the next 2-3 days do we bail on the position or go  to the JUL 70 at $3.50.  Maybe about an even roll but a $5 pop in the next 20 days could give us about a 50% return.    No matter how good we think they are the analysts will spin the opposite.


  292. EDU – I’m loving them as a long play but  very concerned about the June calls, if they don’t come back by Wednesday we have to get out or, as Steve suggest, take a roll.  We are in the $65s for net $4.25 and we can roll to the July $65s for $2.05 and sell the $70s for $1.65 or the $65s we currently have for $3.50, which is trickier to manage but we need to do something before our premium clock starts ticking faster.

    RIMM got a nice bump in market share in Q1 but very likely only because people are waiting for IPhone 2.0:  http://biz.yahoo.com/ap/080530/tec_iphone_market_share.html?.v=2

    Steve – Acually if you look at the GOOG calls as they finished yesterday vs.  where they were when we were discussing them you’ll notice they actually finished LOWER even though GOOG finished $2.80 higher.  That’s because the day’s move was less volatile and lowered the implied volatility for those options but if you look at the intraday highs, you’ll see what I was talking about (also a good example of why you should ALWAYS sell into the initial excitement).

    Pretty much what happens as we get closer is the further out calls get stupider and stupider to play and you’ll notice I begin to favor in the money calls with little or no premium as the front-month play.   You are right, for normal swing trading, you really want to move to the next month once we are 10 days from expiration as it’s just too dangerous.


  293. Hi all,
    Greetings to everone.  Long time listener, first time Caller.  Phil, thanks for the education. 
    Currently live in San Francisco, but considering moving to Frankfurt.  Any suggestions for trading in the Euro Markets.


  294. Mark, The link you provided http://www.tradingmarkets.com/.site/Daytrading/commentary/lftw/09302005-46122.cfm covering market manipulation thru EPREM and minis was real interesting, particularly historical data on up days and down days. We might need to look into incorporating it as another signal. To quote Phil, I don’t mind the market being manipulated, we just want to know when and how etc. (Not a verbatim quote) It is worth chatting some more about. I don’t have access to quotes or charts on this to get a feeling for it.


  295. Phil – portfolio tracking – do you keep all yours in same format posted here? Do you have a package that updates or is it all manual? (like the days to expiration, tickers, etc). I have similar spreadsheets but they’re mostly manual. And, I move closed positions to a separate tab to unclutter my opens, but then it’s not so easy to see overall g/l on trades that span multiple transactions (i.e. multiple rolls, etc). Anyone have a good approach they’d suggest?


  296. EDU – nasty fall on friday, but 80% of the fall was in the first half hour. Monday will be interesting if not decisive IMHO.


  297. EDU – I ended up picking up some Jul’s instead.  Will roll down or DD if it goes lower next week.


  298. mck, my spreadsheets are too ‘busy’ and I have not come up with a good way to track rolling calls and callers that is easy and accurate.  Any ideas out there?


  299. BROADBANDBREW
    Market Update – 6/1/08 
    http://www.broadbandbrew.com
    Sell Your Oil in May and Go Away
    Last week we commented that oil needs to come down for the stock market to have a chance to make any reasonable advances this year. Well, the trading gods were listening. Oil came down about 4% most of which happened on Thursday. Oil prices need to come down a lot more. Stocks are clinging to any positive developments and have recently been very much in tune with the daily fluctuation in oil and other commodity prices. That’s a good sign and maybe just maybe we’ve seen the blow off top in oil. It’s hard to tell just yet, but when every analyst on Wall Street is calling for oil to go much higher, you know that it’s probably close to a long term top.The present commodity and oil boom shows all the classic symptoms of a financial bubble. A quick scan of the top holdings in some of the most popular mutual funds and institutional portfolios shows large positions in oil and commodities. What’s more interesting is that these portfolio managers are starting to take profits and reduce their exposure in these areas. If the big boys are selling then who’s buying? You guessed it. The individual investors are most likely buying as they usually do (at or near the top).

    For the month of May the Nasdaq was up 4.6% while the Dow lost 1.4%. Next week the market will be waiting for the jobs number and looking at oil prices for direction. On a technical note, the market is actually looking pretty good with a bunch of double tops setting up for possible breakouts. Semiconductors and technology are starting to lead again and that’s a healthy sign signaling another sector rotation. We’ll be paying close attention to the charts over the next few weeks for clues while the markets sort out all the inflation and economic concerns.

    Have a great week!
    -Anatole Raif, BroadbandBrew.com


  300. LOL, Welcome Eugene!  I don’t trade EU markets myself but it’s much easier there to find a global trader that lets you trade Asia and the US as well as the EU and that, to me, allows for all sorts of fun possibilities.  One really easy pattern to trade is that the Hang Seng and Nikkei will follow the EU and US up about 80% of the time and the US will follow the Hang Seng and Nikkei down when it’s confirmed by the EU about 70% of the time so just learn your index trades well and watch the markets.  I’ve thought of living in Europe as it can do you the world of good to immerse yourself watching the Asian and EU action ahead of the US open but I seriously would never sleep so it’s a bad idea…

    Portfolio Tracking – What I use is a combination of PowerOptions ($69/month I think) and my own Excel sheets.  Power options updates the positions in real-time so I like that as I’m not very good with Excel macros, but there are plenty of those to feed live data. 

    EDU – Asia did well this morning, if EDU doesn’t get back over $67 I’ll be worried.

    Rolling calls, callers – In my own sheets (and on our bigger portfolios) I don’t log the sale of a call when I’m rolling, I just transfer the basis to the new call.  To me, this is the best way to keep track of a position as it’s always tracking the total investment.  Likewise, when I buy back or cancel a caller, I will credit some of the gain to my call, rather than cash, in order to lower my basis.  As time goes on, you’ll find this gives you a much better view of how your leaps are performing.