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

Click here to see some testimonials from our members!

Thursday – It’s the End of the Quarter as We Know It

It's the end of the Quarter as we know it and we feel fine.  

We feel fine because we cashed out on the long side (shorter-term, unhedged positions) and we really don't care what the market does today or tomorrow but we are betting this rally reverses and we will be taking some (more) short hedges today – hopefully selling into the last legs of this fairly fake-looking rally.  

In yesterday's Morning Alert to Members we grabbed a short-term TZA hedge and I reminded Members in this morning's Alert about our Jan TZA hedge from the 20th that is, so far, down .50 and we'll be putting on a new Jan hedge on TZA (now $35.50) and probably EDZ ($17.90) as our primary hedges against a global melt-down over the weekend.  

Of course, if we were SURE we were going to collapse next week, we'd go with the July spreads but we're only hedging for disaster, not betting on it – at least not until after we fail all our Must Hold levels!

The Nasdaq will be a key good/bad indicator this morning as they ran EXACTLY to our Must Hold line yesterday in a mighty 3-day, 3% move.  Our bullish indicator would be the NYSE breaking over 8,280 – that will keep us a little bullish until our lines begin to break again.  

We'd better be making market progress as the Dollar is down at 74.86 again, back at the early June lows.  I didn't think they could take the Dollar below 75 but they hit 74.54 last night and it remains to be seen if they can hold it down in real trading, especially with the Pound weakness (see this morning's Alert) and the Yen's unwanted strength.  Something's gotta give and we're betting it's this fake, Fake, FAKE rally….

First we'll have to see how far down they can push the Dollar this morning and then we'll see what kind of bump they can give the indexes, which need a whopping 2% to flatten out to last Quarters 5% up finish for the year.  I'm sure that's what the Banksters WANT to see for today's close (just over our 1.25% lines) but that would be one crazy move on the day and it would have to be accompanied by a run-up in oil and gasoline that would sow the seeds for our economic destruction in Q3.

Already oil is back over $95 but we already made a nice bullish play in Tuesday's post on CLR as well as oil futures (/CL) off that $90 line (took the money and ran on oil longs yesterday) as well as Natural Gas (/NG) at $4.20 (which ran up to $4.37 at $100 per penny per contract) and, of course, our huge winner of the week/month was gasoline futures (/RB), which we nailed on Monday where we caught it at $2.7714 in Member Chat at 1pm and I reiterated that trade at 10 pm that night, saying to Members:

Dollar down to $75.66 now that Japan is open. Nikkei (/NKD) up to 9,690. Oil $91.22, gasoline rolled over but July contract (/RBN1) is still $2.829 while the new contract (/RB(Q1)) is $2.764 and that seems cheap going into the holiday…

I reiterated the position in Tuesday's post, saying:

Gasoline futures should be the most exciting play of the day as the new August contracts became the front-month this morning (/RBQ1) and I simply don’t see gasoline staying down at $2.764 so we were loving that for an upside play since last night’s Member Chat. Our expectations are simple – the Dollar topped out at 75.90 in overnight trading and we don’t expect it to get back over there (other than a brief spike) and, probably shortly before we open for trading – we expect some kind of announcement that will take the Dollar down and goose the markets – JUST LIKE LAST WEEK! Why change the play when it worked so well before?

Now I don't often post futures trades on the main page but this one seemed pretty damned obvious to me coming into the holiday weekend.  Yesterday we hit our goal of $2.92 and gasoline flew up all the way to $2.954 before pulling back and is now trading at $2.9373, which is up 17.33 cents and gasoline (/RB) contracts pay $4.20 per 0.0001 PER CONTRACT so that's a profit of 1,730 x $4.20 or $7,266 PER CONTRACT in 3 days – not bad, right?  

As I said, I don't make picks like that very often but banging into low support off a pumped-up Dollar run 4 days ahead of the biggest driving weekend of the Summer just seemed like a really logical bet – these are the kinds of trades we wait for and practice for the rest of the year so we are ready, willing AND able to commit when then time is right.  Congratulations to all who played and let's not short-change those Nikkei futures (/NKD), which topped out at 9,895 last night, up 205 point from Monday's pick at a profit of $5 per point ($1,025) per contract.  

We booked a little cash yesterday calling the NYMEX traders' bluff at $95 and shorting oil but we got out quickly into the close and we'll let them PUMP IT UP again today before we pile on again as we expect the holiday driving numbers to disappoint and, in case anyone forgot, 30M barrels coming out of our SPR will begin flooding the markets next week and I doubt that they can get imports much lower than they are now at 8.9Mbd, which is still down 400,000 barrels a day from last week leading to 2.8Mb of draw in yesterday's inventory report but was an excuse for yesterdays fake, Fake, FAKE run back to $95.  

Compared to last year, imports are down a whopping 1.2 MILLION barrels per day.  That's 8.4 MILLION barrels PER WEEK LESS oil being shipped to America yet our oil inventories are down just 3.5M barrels from last year.  Think about that, the crooked, evil, scheming, manipulative bastards at the NYMEX and the Bankster crooks that fund them are shorting us at a rate of 436.8 MILLION barrels of oil per year yet the draw-down in US inventories over the past year is just 3.5 Million barrels.  What does that tell you about the real demand for oil – not the BS you hear on CNBC who would NEVER show you these number – even though they are published weekly and are the most important thing there is if you are going to have an intelligent discussion about the oil market.  

Is CNBC just completely inept at reporting the news and covering the energy markets or are they LYING to your face and involved in a conspiracy to create a false impression of the energy markets including completely misleading representations of supply and demand issues in order to extort (along with their co-conspirators) Billions of dollars in excess profits (ie. price gouging) from US consumers while, at the same time, committing investor fraud?  We report, you decide – maybe they are just unbelievably stupid

Oh well, I'm not going to demand an investigation or ask you to write to your Congresspeople because you never do.  We'll just keep playing the ridiculous manipulation and making our money off it while the rest of America gets screwed and it does make me fell a little bit better about it to point out what a horrible scam the whole thing is because, MAYBE, one day, enough people will wake up to put a stop to this nonsense.  

I hope so, because it's the kind of nonsense that is destroying our country – these people are TRAITORS – they are selling our Nation down the river in order to line their pockets.  They lie, they abuse the power given to them by the FCC to broadcast and do nothing more than run a 24-hour infomercial for whatever manipulator pays their fees and they create an environment of fear and panic to generate ratings and, of course, to churn those accounts and generate fees for their sponsors.  

Stick with that Cramer, you sell-out POS!  


Tags: , , , , , , ,

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

Comments (reverse order)

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

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

    Click here to see some testimonials from our members!

  1.  Phil
    Maybe there are VIX calls worth buying, given that VIX has dropped and POMO support is ending.

  2. Phil—please let trading futures be one of your topics at the meeting in Vegas

  3. The car from Atlas shrugged motors.

  4. Phil, would you suggest cashing out anything in long term portfolios like 401k ahead of your predicted downturn this holiday? It’s fairly easy to cash out in my particular plan but of course w mutual funds you can only do this every 90 or 180 days or u start getting fee’d to death. I have already reduced some of the really long term stuff that has paid very well for the last 2 years but am still about 60% invested in equity mutual funds.

  5. PP for today.


    Can’t remember who made a comment on CRIS to me yesterday, but the answer is – no se!  The person that posted it on SeekingAlpha was picked up by several news agencies as well.  Time will tell….but long term, they are one of my favorites.

  6. Savi, about Vegas, Planet Hollywood Tower for 160 is ok price?

  7. Pharm, welcome back! I live in Burlington, MA and (I think) I seen that CRIS’ HQ is in Lexington, MA (about 10 minutes away)….I was actually thinking of stopping by and asking for a tour (if they give those)…Let me know if you want me to ask any questions….

  8. Pahurik – Planet Hollywood (the old Aladdin) is not that great of a venue, definitely worth it to spend 30-50 more a night and stay in MGM, Treasure Island, Etc…

  9. The McClellan Oscillator is the highest it’s been since Sept 2010, and that was at yesterday’s close.  Today has to be shorting day.

  10. Vegas—I will stay  where most people are staying--I have not been to Vegas for over 15 years--have no clue re accommodation--will go with majority

  11. Phil,
    I have two long term CSCO trades that I had done a few months ago when CSCO was at 20 and 16 respectively. Would you recommend any adjustments.
    Trade 1 – Sold 10 JAN 2012 CSCO Puts at 3.80 – currently at 4.925
    Trade 2 – Bought 20 of the JAN 2013 15/17.5 Bull Call spread selling the 17.5 Puts for a $1.85 credit. ($2.775 Debit now) 
    Also, I still like CSCO and do not see it south of the 10-12 range and want to scale into trade – your recommendation?

  12. and where most people are staying? I looking and rooms are sold very quickly for this weekend. Of course I can bidding for lastminute price in pricline, but long way from Strip is not good.

  13. If anyone still wants to jump on the Gold in CHF bet I proposed two days ago. The future face values fits perfectly to do this bet. Just sell 1 6S contract and buy 1 GC contract. (attention: 150K USD each) So far the bet is doing quite good.

  14. jr – thx.  That would be interesting!  I am still on vacation, but will be back after July 4.

  15. Good morning,


    IWM    79.96,  80.18,  80.48,  80.81,  81.09,  81.49,  82.28,  82.82  and 83.38

    Good hunting !!

  16. Three White Soldiers from SHJ, so now "they" have the technicals !!

    Last line of defence:

  17. Ha ha… they’re going for it! Gotta assume insanity in this market.

  18. HOV – nice bounce off the low on 6/14.

  19. Financials not participating in the rally.

  20. I didn’t trade gasoline futures because Phil said on Tuesday that it moves $4,200 per penny per contract and so I assumed I couldn’t risk, for example, a 10 cent down move that could cost $42,000. However, it’s worth noting that $4.20 per .0001 is actually $420 per penny, which is not chump change but still is a much more manageable level of risk.

  21. Good morning!  

    OK, I got my oil rant out of my system – that happens when I spend a lot of time reading up on data and stuff and I’m reminded what a scam this whole thing is but now I’m ready to play the crooked game again.  

    Dollar is dangerous for the market above 75, now 74.85 but I’m pretty sure they are going to keep a lid on it here.  Pound is pathetic at the $1.60 line (again) and the Euro is back to struggling to hold $1.445 ($1.44617) and the Yen bounced off 80.25 (too strong!) and is back to 80.426 but that’s still bad as they had it back down (up is down) to 81.17 yesterday.  

    Oil (/CL) is in a very tight range at the moment between $94.50 and $95.50 so we’ll see which way that breaks but playing the middle is crazy (now $94.83).  CNBC is pumping their asses off, saying the release of the SPR didn’t help but NOT ONE BARREL has moved from the SPR so far so they are LYING TO YOU.  Why are people not outraged that "The World’s #1 Business Network" blatantly misrepresents the facts in order to push their agenda?  

    A nice short play on oil over the weekend is the SCO Aug $45/50 bull call spread for $2.40, selling the $45 puts for $2.20 for net .20 on the $5 spread.  $45 on SCO is roughly $97.50 on oil so the bet is oil won’t go higher than that and that it will head back to $92.50 or lower but it pays 2,400% if it works out and you can roll the puts so a great conviction play if you don’t think oil can get back over $100 long-term.  

    That’s the part I don’t get.  They manipulation I understand – there’s money to be made and there are very few rules and those aren’t enforced and, when they are enforced, the fines are a joke so lying to you makes good business sense for CNBC.  What I don’t understand is why people accept it?  Have we really become that subjugated to the MSM that we just accept our lot in life and take whatever crap they dish out?   

    Wheee – Dow positive for the Quarter at 12,335!!!!  Did you doubt they could do it?

    8,286 on the NYSE is Goaaaaaaaaaaaaaaaal and we’re at 2,760 on the Nas, 1,316 on the S&P and 825 on the RUT – AMAZING!   

    TBT is at 34.70 so all is not that well, is it?  

    This is why I didn’t want to go short early – we have to wait out the window-dressing madness.

    We got a very good Chicago PMI and that’s fueling the move up at the moment.  

    09:46 AM Chicago PMI: 61.1 vs. 53 expected, 56.6 prior.

    It’s going to be a crazy couple of days – strap in!  

    Thursday’s economic calendar:
    8:30 Initial Jobless Claims
    8:30 ISM New York Business Index
    9:00 Quantitative Easing Conference
    9:45 Chicago PMI
    10:30 EIA Natural Gas Inventory
    11:00 KC Fed Manufacturing
    1:00 PM Fed’s Hoenig speaks at the Rotary Club of Des Moines
    2:00 PM Hearing: State of the FDIC’s Deposit Insurance
    4:30 PM Money Supply
    4:30 PM Fed Balance Sheet
    5:30 PM Geithner: Q&A on Job Creation 

    Notable earnings after Thursday’s close: APOLDRI

    At the open: Dow +0.31% to 12300. S&P +0.29% to 1311. Nasdaq +0.36% to 2750.
    Treasurys: 30-year -0.03%. 10-yr +0.13%. 5-yr +0.1%.
    Commodities: Crude +0.24% to $95.00. Gold +0.05% to $1511.10.
    Currencies: Euro +0.23% vs. dollar. Yen +0.61%. Pound -0.33%.

    Market preview: S&P futures +0.3%, paring gains following worse-than-expected jobs data, but the Greeks look like they’ll pass a second austerity bill, so all is right with the world. Lloyds +8.1% after announcing big job cuts, while First Solar +6.8% on reports the DOE will announce $4.5B in loan guarantees for three California solar projects.Later: Chicago PMI, KC Fed manufacturing.

    Initial Jobless Claims: -1K to 428K vs. 420K consensus. Continuing claims -12K to 3.702M.

    June ISM NY Report on Business: 52.6 vs. 67.9 in May. New York City business activity expanded at the slowest rate in two years.

    Dollar downer:  Believing flaws with current yuan policy are becoming more obvious, Bank of China says it’s "very likely" Beijing will widen the trading band of the currency vs. the dollar.

    Small business borrowing rose by a record 26% Y/Y in May to a level not seen since July 2008. The fact that small businesses – which account for 80% of new hiring – are finding risk-worthy opportunities is a positive economic sign that can’t easily be written off. 

    ROFL! – Where’s Beeks?  The grain markets could be in for a nasty move today following the USDA’s crop acreage report showing higher than expected plantings this year. The amount projected to be harvested is greater than market anticipation as well. JJG  -3.1%CORN -3.7% premarket. 

    Adieu, QE2. The Fed ends its $600B bond-buying program today, with opinions mixed as to whether the program was a success and if another round of easing is likely to follow.

    Greece’s parliament approves the 2nd austerity bill, the last hurdle to receiving bailout funds from the EU/IMF.

    Dollar downer, Part II: The ECB signals it will again raise rates next week from 1.25% as eurozone June CPI comes in at 2.7%, ending speculation it might delay a hike in light of the Greek crisis and fears of contagion.

    PragCap’s "wall of worry" indicator has trended lower in the past month, but it is still at a "historically high level" consistent with an environment in which long-term fears over the economy are high. The reading tells Cullen Roche that there is still "substantial worry in the market."

    Ahead of today’s meeting with Finance Minister Schaeuble, German banks and insurers have agreed on a draft proposal for rolling over Greek debt. Expect details when Schaeuble makes a statement at about 9 AM ET.

    Oopsie!  Deutsche Bank rushes to clarify an earlier comment from CEO Ackermann in which the FT had him saying DB would help with Greece, "not because we are doing it willingly." The bank wants all to know he said "not because we are doing it gladly." Remember, it’s all voluntary.

    On his way out of his post, the RBA’s McKibben allows himself some straight talk. Speaking of government finances, he calls it "a slow motion train wreck – the first carriage to break is going to be the Greek economy … there’s almost guaranteed collapse or crisis in the eurozone."  McKibbin calls for higher rates across the board in the U.S., Europe, and Asia. "The (Fed) has to tighten policy, you cannot give away money and have a vibrant economy." The aussie illustrates this week’s return to risk as good as any asset, a startling move 350 pips higher in 60 hours.

    Interesting:  Lehman yesterday said it has won consent for a $65B liquidation plan from derivatives creditors. The program gives more money than previously proposed to Goldman Sachs (GS) and Morgan Stanley (MS), and less to bondholders led by Paulson and including Calpers.

     "Sand in your wheels," says ECB chief Trichet of a Tobin tax on financial transactions, thoughts of which are making the rounds in the EU (Italy yesterday). Trichet is doubly against such a move if it is not global in nature, as this would put Europe at a competitive disadvantage.

    Economic contraction accelerates in Portugal, where retail sales for May come in 7.9% below last year, apparently the largest drop on record.

    New economic figures point to Turkey’s economic boom and its unsustainable nature – Q1 GDP expanding at an 11% pace while the trade deficit more than doubles from last year. Pressure will grow on the central bank to abandon its policy of methods other than rate hikes to cool growth.

    Bearish??  Are they kidding?  This guy has been pumping banks all year!  Known for his bearish commentary on Goldman Sachs (GS), Dick Bove is making a bullish call on bank stocks. His reasons include the 

  22. Phil

    Bearish??  Are they kidding?  This guy has been pumping banks all year! Known for his bearish commentary on Goldman Sachs (GS), Dick Bove is making a bullish call on bank stocks. His reasons include the BACsettlement, positive housing data, healthy balance sheets, a diminishing spread between high yield and high grade bonds, and the Fed’s recent debit card fee ruling

    Analyst commentary on Visa (V) and MasterCard (MA) is mixed following the Fed’s relatively tame debit fee regulations. Robert W. Baird sees a higher-than-expected fee cap reducing pricing pressure from bank issuers, but Citigroup cautions that banks will still be taking a "46% hit to their debit interchange revenues."

    eBay (EBAY+4.2% premarket after BofA and Citigroup upgradeto Buy as rules on debit interchange fees clarify. Jefferies’ Youssef Squali says PayPal largely will not be affected by the new cap rules, and stands to save $74M-$96M in processing costs it can use to improve its competitive advantage.

    Schnitzer Steel (SCHN -2.6%misses 3Q estimates as profits fell 18% YoY, hurt by lower margins and a higher tax rate. On a postitive note, revenues significantly improved as the scrap metal recycler continues to benefit from strong demand in South Korea, China and Turkey.

    Rite Aid (RAD) same-store sales +1.8% in June. Total drugstore sales +1% to $1.928B. Shares +1.6%. (PR)

    Constellation Brands (STZ): Q1 EPS of $0.39 beats by $0.02. Revenue of $635M (-19.4% Y/Y) beats by $32M. (PR

    First Solar (FSLRjumps 6.8% premarket to $138.22 on reportsthe Department of Energy will announce $4.5B in loan guarantees for three California solar projects. The stock was also initiated with a Positive and a $160 price target at Avian Securities, while Notable Calls thinks the stock will trade in the $140-145 range today on the DoE news.

    American Airlines (AMR) is reportedly in talks with Boeing (BA) and Airbus (EADSY.PK) to buy as many as 280 planes in a deal that could be worth over $22B at list prices. Even a partial entry into American’s Boeing-only fleet would be a coup for Airbus.

    Amazon (AMZN) plays hardball with California politicians telling marketing affiliates in the state it will cut ties if an online tax law is passed. Affiliate sites refer visitors to Amazon, and receive a commission for each sale. Gov. Brown is expected to sign the bill this week to try and help the state with its staggering budget deficit. AMZN -1%premarket. 

    According to Nielsen’s May survey, smartphones accounted for 55% of U.S. cell phone purchases in the prior 3 months, up from 34% a year before. Google’s (GOOG) Android maintained a 27% share of purchases, while Apple’s (AAPL) iPhone grew from 10% to 17%. This could add to fears about the iPhone slowing down Android’s U.S. growth.

    Canalys sees mobile apps store revenues nearly doubling this year to $14.1B. Meanwhile, IDC forecasts mobile app downloads soaring to 182B in 2015. Factor in Apple’s (AAPL) claim that over $2.5B in iOS developer payouts have been made, and it looks like the App Store is becoming a big business for Apple in its own right

    Another IPad Killer bites the dust:  Hewlett-Packard’s (HPQ) TouchPad tablet goes on sale Friday, but early comparisons don’t hold up well vs. the iPad (AAPL) or top Android (GOOG) tablets. WSJ‘s Mossberg: “Despite its attractive and different user interface… it suffers from poor battery life, a paucity of apps, and other deficits.” NYT‘s Pogue notes that the TouchPad is 40% thicker and 20% heavier than the iPad.

  23. Oil Lines
    R3 – 99.54
    R2 – 97.69
    R1 – 96.38
    PP – 94.53
    S1 – 93.22
    S2 – 91.37
    S3 – 90.06 

  24. FAS Money / Phil – Assuming that we killed all the shorts from last week, do you suggest we wait to initiate new shorts? Starting tomorrow, things could be shaky and I would not want to bet one way or the other. 

  25. Phil, do you wait till end of day before going short, or do you see if we touch and can’t break 12400?

  26. Was it not David having a firm believe in FSLR congratulation I am holding the short puts

  27. phil, is it a good time to long vix? thanks,

  28. Go HOV go!!!

  29. FAS Money / Phil / Stjeanluc
    I am trying to follow Phil’s instructions, so am still short weekly 24 calls.
    I am getting confused with the two different streams of instructions / directions and am having a hard time following / learning this Income Play.
    I look forward to seeing how to handle the short 24 weekly call.

  30. VIX/Strether – Good idea!  

    VIX Aug $15/17 bull call spread at $1.20, selling $16 puts for .50 is net .70 on the $2 spread.  

    Other nice offsets (short puts that can be sold as a hedge because they make nice entries anyway) for Aug are:  

    • AMD Aug $7 puts for .40 (all short sales) 
    • BA Aug $70 puts at $1.30
    • INTC Aug $22 puts at .84 
    • DIA Aug $117 puts at .92
    • AAPL Aug $300 puts at $2.70
    • MO Aug $26 puts at .57 (Pot Cigarettes!) 
    • HPQ Aug $36 puts at $1.05
    • DIA Aug $38 puts at .95
    • MON Aug $65 puts at .80
    • X Aug $40 puts at .77
    • T Jan $27.50 puts at .82
    • PFE Jan $19 puts at .95

    TBT $35!  

    Dollar 74.78 – oil $95.10 – Yen dropped hard to 80.80 but rejected there.  

    So, a couple of hedges are:  

    • TZA Aug $34/42 bull call spread at $2, selling $30 puts for .95 is net $1.05 on the $7 spread (or any of the above offsets, of course).  
    • TZA Oct $31/42 bull call spread at $3, selling RUT Aug $710 puts for $2.90 for net .10 on the $11 spread that’s $3.70 in the money!  The RUT $710 puts are a 14% drop in the Russel in 50 days – that would be nasty and would put the calls 100% in the money and, of course, you can roll the puts along or just sell the BAs if it makes you nervous.  
    • EDZ Aug $16/20 bull call spread at $1.40, selling Oct $15 puts for $1.20 is net .20 on the $4 spread (20:1 payoff!).  Keep in mind, when you offset with the same index, you can’t lose on both sides at once – when you pick a stock – you might…
    • EDZ Oct $16/23 bull call spread at $2, selling Oct $15 puts for $1.20 is net .80 on the $7 spread.  Less payoff, more time to be right.  

    Later today we’ll look at some short put plays, when we’re sure we’re done going up (remember – I said ideally they will want to be up 2% for the day and we have 1% already with SOX up 2%).  

    EIA Natural Gas Inventory: 78 bcf vs. consensus of 80 bcf. Futures recover from early losses, now +0.5% to $4.336. 

    QE2 worked by helping avoid a Japan-style deflation, St. Louis Fed’s James Bullard says, and showed that "the Fed can conduct an effective monetary stabilization policy even when policy rates are near zero." The results were the same as if rates were reduced, he says: real interest rates and the dollar declined, inflation expectations and equity prices rose.

  31. need your slant on SQQQ. Had July 29-32 spread for .80. Rolled the JUly29s to August 30 for 80.loss. Held on the July32callers ($.73), which i haven’t bought back yet. My problem is theAugust 30 calls bought at 1.6 nowdown to.75 Cents. Have .60 cents in VLO and BTU offsets. thanks

  32. pete
    FAS I am in the same boat today the new weeklies are out but we still have an up market so it might be a good idea to wait till tomorrow as for the long week end the market might be down and better to roll. lets see what Phil thinks.

  33. Phil,
    Current position in CSCO:
    stock  400 shares                     @  22.59
    sell jan 12 25 C  4 contracts     @ 2.95
    sell jan12 20 P   4 contract       @ 2.39
    sell jan 13 17.5P 6 contracts     @2.50
    Would like to roll to Jan 13 12.5 P @ 2.15 @  20 contracts  , Leaving the 25 call as is; Does this make sense?

  34. Let’s herald in the end QE2 by celebrating TBT being up 8.5% in 4 days.
    Can the run to 50 finally be unleashed? Only an official announcement of QE3 can stop this thing now.

  35. In TZA off the 82.82 line !!

  36. bonds are not going to fall if the market is swooning imo

  37. from Rosenberg – Tomorrow’s data are key; The ISM is a critical release tomorrow and while the consensus sees only a fractional decline to 52, we see even-odds of a sub-50 headline

  38. MO Aug $26 puts at .57 (Pot Cigarettes!)  Putting every cent into that one

  39. Phil, what’s scary is if Americans ever do wake up from their fastfood induced, TV watching coma…. We wont need moltav cocktails since we own 90 guns per 100 citizens…

  40. Phil, as we pullback on stocks, flight to bonds like last summer, fall in TBT?

  41. NVS gout drug was rejected a few days back.  Good for SVNT.  Selling $8 Ps (Aug) for another entry on them.  Also sold the Aug 8 Cs.  Ok, now heading on the road to Iowa.  Should be on line for a bit tomorrow……later all!  Oh, and TBT, I will be shorting it soon.  TLT will run this summer if the market shows any hiccup.

  42. OK, I’ m capitulating !! Out of TZA with 2 cents.

  43. OK, now to try to catch up on comments.  If I miss you – feel free to re-ask.  

    Futures/Savi – Yes, I think that’s a really important one.  I intend to do live futures trading in the afternoon on Sunday. 

    401K/Dforster – If you can’t protect it, yes, but it’s not DEFINITE that we go down so a nice hedge works wonders.  As Madonna used to say, we are living in a technical world and the technicals look good and exciting to global investors if we hold 1%-2% gains through tomorrow.  Europe took off like a rocket into their close and finished up about 1.25% on average but they were halted by the bell so if we have a good finish today, they will be all juiced up for tomorrow’s open.  My attitude is we should layer into (scaling) disaster hedges like the ones above and if they want to keep taking it higher – we’ll just buy higher hedges but we’ve already proven that $100 oil is NOT good for the markets yet here we are repeating the same mistakes with the same weak-assed Dollar driving the markets – it’s all BS – the only question is how long will it last?  

    CSCO/Rehat – I wouldn’t do anything right now.  The VIX dropped so not a great roll to 2013 puts and they still have premium and look at CSCO’s move the last couple of days (screw you non-believers!).   If you want to add, however, you can spend $1.60 to roll the 2013 $15 calls to the $12.50 calls and that puts you $2.50 in the money for $1.60 and you COULD roll the Jan $20 puts ($4.80) down to 2x the 2013 $17.50 puts at $3.60, which puts another $2.40 in your pocket and drops the putter $2.50 on the possible DD (triple really as you already have 1x the $17.50 puts) at $17.50 but, if you REALLY want that much CSCO for that net – why not?  Just make sure you cover if they go below $15.50 again.  

    Great SPY line JRW – bounced right off $132.  Well worth watching people!  

    HOV up 10%!  

    Financials disappointing and they need to lead if we’re going to get a good rotational (out of commodities) breakout.  

    $420 per penny gasoline/Jvest – Oh, that’s much cheaper then.  Sorry.  I always buy 10 lots so I guess I got confused…  Testing $2.95 again this morning but too dangerous to short until tomorrow.  

    FAS Money/StJ – I think selling the next weekly $25 calls is a good idea (now $1.05) if someone has the open short $24 calls from this week, they are $1.60 and still have premium so may as well wait for tomorrow unless XLF breaks over $15.35 – then we’d have to take another look.   Any short puts are looking worthless but I would not want to sell next week puts yet as they are too cheap and we expect a pullback anyway.  After we sell the $25 calls, if XLF pops, we may want to sell the $26 puts to cover and get more neutral so staying naked keeps us more flexible and, hopefully, we can get .50 or better for the $24 puts (now .25) on a dip.  

    Waiting/Rustle – I’m for scaling in here.  Grab 1/4 and see how it goes, commit another 1/4 later and save the rest for tomorrow.  If the first 1/2 we play gets an immediate pay-off tomorrow – we won’t have any complaints, right?  On the other hand, if we get blown out tomorrow on another run – we’ll have plenty of dry powder for the roll.  

    FSLR/Yodi – I firmly believe they are a great short at about $150.  

    VIX/Ethan – see above.  

    FAS Money/Pete – Short $24 calls and puts is my official play.  See above roll, let me know if you have questions. 

    74.67 – $95.782 oil.  

    Dow volume at 11 just 48M – what the hell kind of rally is that?

    Oil for China/Angel – Maybe but they do have their own reserves.  

  44. JRW
    First time ever I made .10 to your .02, got out very quick.

  45. WFR may have seen a bottom – about time! CSCO may have too but low volume so "what kind of rally is that"? :)

  46. Phil FSLR I like your positive view now (before negative!) I was carefull on that one, holding the SEP 125 and 120 p short  60 % UP JUST NOW.  But 150 I feel is high as they jump like a yoyo, was holding them when they were 115 as well!!!!

  47. Phil / rug — Do you think they pull the rug tomorrow or Monday?

  48. Phil / pitiful Dow volume   Why aren’t funds buying more today to ‘window dress’ into the pop for Q end? 

  49. once  recession fears ebb… the 10-year yield should work back toward 4%…with this we should work stocks to 2007 highs..but first lets continue the summer swoon

  50. CCJ turned around also but near resistance. Could turn back down with the wild fires and floods putting reactors into defensive mode.

  51. Testing 82.82 as a floor; I will buy the winning direction !!

    There’s another Sell signal; 1/3 in TZA !!

  52. Tusca / funds — Do their transactions need to be settled by today?

  53. NLY play they up again to 18.10 so the OCT putters sold show a nice profit against the Jan 13 17.50 Just an indication how things can change.

  54. Our pals at SPWRA are making a nice comeback.   Can WFR be far behind?  

    SQQQ/Drum – Well that’s the problem, you added to the bear side with no additional offsets but good job moving to Aug.  Just keep in mind that what can be quickly done (drop in SQQQ) can be just as quickly undone – the trick is to keep yourself in good position.  The July $32 caller is .05, it would have been nice if you rolled him sooner but, whatever.  Now, you have Aug $30s at net $1.65 (assuming you buy back the caller) less the offsets, which I imagine are doing well so call that .60 less or $1.25 net and they Aug $30s are now .80 – that’s great if it was a hedge and you have bullish plays that are rockin’ on this move but a 50% loss if it was just a bet.  Since we still believe in a sell-off and the Aug time-frame is right, then I"d sell the Aug $29 calls for $1 and roll down to the $24s at $2.35 for .55 more so you would be in the Aug $24/29 bull call spread at net $1.75 on the $5 spread that’s .90 in the money and then you just have to find a new offset for $1 and you’re back in business.  

    Nice Yodi – I think what you think!  

    CSCO/Jasu – Well the callers are dead.  There’s a reason we take them out when we beat them by 85% and that’s because they have nothing left to give you so either sell something with more premium to protect you or ride naked for the bounce but once those $2.95 short puts fell below .50, it was time to move on!  Meanwhile, let’s focus on the basics – you are in the Jan spread at net $17.25/18.62.  If you roll the 4 Jan $20 puts ($4.75) and the 6 2013 $17.50 puts ($3.65) to 20 $12.50 puts ($2.15) that’s about even and drops your net to $17.25/14(ish) and your worst case is you end up with 2,000 shares of CSCO at net $28,000 so sure, that makes sense if it fits your portfolio.  I would hold off on selling calls but keep in mind that if you sell the 2013 $15 calls for $2.50, you drop your basis to net $14.75/13(ish) which means you only need $26K to buy in and, if CSCO goes up, you can always roll the caller to 2015 $17.50 puts and calls at least.  So don’t be greedy – as long as CSCO is moving up it’s fine to wait but maybe a .50 trailing stop on the call sale, just to be safe?  By the way, all should take note that Jasu bought CSCO at $22.59 and we’re talking about him taking the stock even at $13 – THIS IS WHY AND HOW WE SCALE INTO POSITIONS!  

    TBT/BDC, Rpme – Gosh I hate to pick them because people always end up cursing me out but that trade, to me, is as inevitable as the gasoline trade.   The Jan $30/37 bull call spread is $4 and you can sell the 2013 $30 puts for $3 for net $1 on the $7 spread that’s $4.81 in the money (up 381%) at the moment.  Sorry guys but I still love this trade!  

    Guns/Jrom – Good point!   Scared white people with guns is what built this country:  

  55.  Pharm – Enjoy the trip!  I’m an Iowa native myself.  Boone, Des Moines, Bedford.

  56. Of coarse !!

    After all, everything is fine !!

  57. CNBC and Kudlow make me want to shoot my TV. 

  58.  WFR – sold a $8 put as an offset to a hedge on Tuesday and they are now down to a few pennies.  The hedge is half paid for and still operating.  Gotta love it!  

  59. Dow 12,400 was resistance twice before our April run. Bottom of the upward trend line is 12,500. SPX was 1340, IXIC was 2815, and NYA 8525 when the dow was peaking in april at 12,400. So the Dow is leading. RUT not as well correlated.

  60. Phil,  sorry I might have asked this before, but I was really hoping you could recommend a hedge from my very commodities-centric/anti-dollar 401K portfolio that only allows long stocks/ETF’s, covered calls and protective puts.  They also do not allow ultra ETF’s.   So can’t even do a long on SDS, but can do a long on DOG or SH.   And no, I cannot get rid of the broker due to the fact I work for a brokerage.   I have 90k in postions (some covered with ATM July calls), 100k in cash.     Would you be
    a) going 100% to cash now;
    b) buying some puts; 
    c) doing something 100 shares of DOG covered a call (about 4k )
    d) doing something else or nothing?
    You might recall I view this long-term portfolio as a hedge against dollar debasement, so don’t want to rebalance it too much, but would like to protect it a bit given the run-up.


  61. Phil / Rally / What Kind:  A Fraud.  There simply has to be collusion in this market between the big IBs.  It probably occurs when they confer every morning with the Fed!  And that is no lie.  It happens daily.  There is NO selling occuring.  They can put the needle where ever the friggin want.  Whenever they want.

  62.  IBM/Rain – Just goes to show you what a little R&D spending can do.  If only other US corporations would get the message!  I did some work in Armonk years ago and I would never, EVER short this company – not this decade, or the next or the next.  The Watson tech alone will change the world but the stuff they are doing with quantum chips and cube memory is mind-blowing.  This is just an offshoot of their work but…. COOL! 

    You’ve got to hand it to IBM’s engineers. They drag themselves into work after their company’s 100th birthday party, pop a few Alka-Seltzers and then promptly announce yet another seismic invention. This time it’s a new kind of phase change memory (PCM) that reads and writes 100 times faster than flash, stays reliable for millions of write-cycles (as opposed to just thousands with flash), and is cheap enough to be used in anything from enterprise-level servers all the way down to mobile phones. PCM is based on a special alloy that can be nudged into different physical states, or phases, by controlled bursts of electricity. In the past, the technology suffered from the tendency of one of the states to relax and increase its electrical resistance over time, leading to read errors. Another limitation was that each alloy cell could only store a single bit of data. But IBM employees burn through problems like these on their cigarette breaks: not only is their latest variant more reliable, it can also store four data bits per cell, which means we can expect a data storage "paradigm shift" within the next five years. Combine this with Intel’s promised 50Gbps interconnect, which has a similar ETA, and data will start flowing faster than booze from an open bar on the boss’s tab. There’s more detailed science in the PR after the break, if you have a clear head. 

    Dollar bounced off $74.60 – that will put a top in if they can’t bust it (and I don’t think they can).  We have 12,400 on the Dow, 1,320 on S&P, 2,772 on the Nas, 8,314 on NYSE and 828 on the RUT.  SOX are up 2.5% so it makes sense they stop there too so good time to initiate those short positions.  

    Fun downside play on the Dow is the July $123 puts at .96.

    SPY TOMORROW $132 puts at .25 are also fun to play as a craps roll.  

  63. Oops, and oil below the $95 line!  

  64. Phil / IBM — They are an amazing patent machine! R&D is in a sad state in this country but the dumbing down is working!

  65. Phil, I have SQQQ July $25/26 BCS, paid $0.50, now is $0.30 and SQQQ is $24.85.  Is it good idea to roll the $25 calls to July $24 calls for $0.50? Thanks.

  66. A little squeezy triangle education: Textbook Triangle Trade Example in Crude Oil

  67. Phil, aren’t those .25 SPY puts TODAYS (Jun 30th) puts? with tommorows puts (JUL 1) at .52?

  68. Buying TNA for the first time today; where is that Kool-Aid ?

  69. Got in on the DIA puts.  Die market die.

  70. Great.
    JRW is buying and Felipe is selling.
    Gotta coin anyone?

  71. JRW – the two 11:48 and 11:58 450k IWM volume spikes were impressive.  Almost too obvious…the bots are getting sloppy!  What are your levels past 83.38?  My last is 83.47…

  72. phil are you referring to 74.60 on the cash or the september contract?

  73. Phil / FCX  — Metals have been on a tear the last few days, you had FCX Jul $47p’s in the income portoflio that are at 85% of potential. Personally, I’d take that here, you?

  74. When is the meeting in Vegas?

  75. flips

    Don’t worry yet, I have R/S at 83.01 that I forgot about AND I have no conviction at this point. Good luck !!

  76. FSLR/Yodi – I’ve always liked them short when they get up there.  I just don’t like the company so I prefer to short them with conviction when they are high and then wait for the next "big news" to run them up again.  Once they get moving up, there is little to stop them so I set high targets before I want to risk a bearish entry.  

    RUG/Rain – Well they don’t WANT the market to crash so it depends on if any big sellers want to cash in before the holiday weekend.  I would (already did) because 3 days is a long time with all the crappy news that’s floating around in the World and we come back into a buys data week and the beginning of earnings season a week later – who wants to risk that?  

    Date ET Release For Actual Forecast Consensus Prior Revised From
    Jul 05 10:00 Factory Orders May   NA NA -1.2%  
    Jul 06 07:00 MBA Mortgage Index 07/02   NA NA -2.7%  
    Jul 06 07:30 Challenger Job Cuts Jun   NA NA -4.3%  
    Jul 06 10:00 ISM Services Jun   NA NA 54.6  
    Jul 07 08:15 ADP Employment Change Jun   NA NA 38K  
    Jul 07 08:30 Initial Claims 07/02   NA NA NA  
    Jul 07 08:30 Continuing Claims 06/25   NA NA NA  
    Jul 07 11:00 Crude Inventories 07/02   NA NA -4.375M  
    Jul 08 08:30 Nonfarm Payrolls Jun   NA NA 54K  
    Jul 08 08:30 Nonfarm Private Payrolls Jun   NA NA 83K  
    Jul 08 08:30 Unemployment Rate Jun   NA NA 9.1%  
    Jul 08 08:30 Average Workweek Jun   NA NA 34.3  
    Jul 08 08:30 Hourly Earnings Jun   NA NA 0.3%  
    Jul 08 10:00 Wholesale Inventories May   NA NA 0.8%  
    Jul 08 15:00 Consumer Credit May   NA NA $6.5B  

        After The Close Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
      Alcoa AA   0.35 0.13    
    Conference Call (Telephone) Novellus NVLS   0.77 0.66    

        Before The Open Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
      Fastenal FAST   0.30 0.47    
    Conference Call (Telephone) Infosys INFY   30.62 0.57    
    Conference Call (Telephone) Wolverine WWW   0.46 0.39    
        After The Close Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
    Conference Call (Telephone) ADTRAN ADTN   0.54 0.44    
        Healthcare Services Group HCSG   0.15 0.20    

        Before The Open Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
      ASML Holding ASML   0.94 0.54    
        CAE CAE   0.16 0.15    
        After The Close Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
    Conference Call (Telephone) Marriott MAR  

  77.     Before The Open Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
      ASML Holding ASML   0.94 0.54    
        CAE CAE   0.16 0.15    
        After The Close Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
    Conference Call (Telephone) Marriott MAR   0.37 0.31    
    Conference Call (Telephone) Universal Forest UFPI   0.15 0.83    
      YUM! Brands YUM   0.61 0.58    

        Before The Open Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
      Commerce Bancshares CBSH   0.72 0.71    
        Fairchild Semi FCS   0.40 0.40    
        Hi-Tech Pharmacal HITK   0.71 0.50    
        iGATE IGTE   0.04 0.20

  78.     Before The Open Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
      Commerce Bancshares CBSH   0.72 0.71    
        Fairchild Semi FCS   0.40 0.40    
        Hi-Tech Pharmacal HITK   0.71 0.50    
        iGATE IGTE   0.04 0.20    
    Conference Call (Telephone) JPMorgan Chase JPM   1.20 1.09    
        After The Close Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
        AngioDynamics ANGO   0.10 0.14    
        JB Hunt Trans JBHT   0.52 0.40    
        Joes Jeans JOEZ   0.01 0.01    
        National Beverage FIZZ   0.22      
    Conference Call (Telephone) Resources Connect RECN   0.10 0.08    

  79. Phil – Would you suggest a doubledown on the July $34 TZA Calls…I am in at 2.90…If we are about to head down from here…can get a pretty solid doubledown. I was only 1/2 in to start as well anyways.

  80. Phil,
    What do you think the chances are that the ‘first day of the month’ fund buying is going to keep the market up tomorrow?

  81.     Before The Open Ticker Actual   Consensus Yr Ago   Yr/Yr Rev  
    Conference Call (Telephone) Citigroup C   0.98 0.09    
        Gannett GCI   0.58 0.61    
    Conference Call (Telephone) Genuine Parts GPC   0.89 0.78    
    Conference Call (Telephone) Mattel MAT   0.15 0.14    
    Conference Call (Telephone) Webster Financial WBS   0.35 0.15    

    Window dress/Tusca – We’re up 143 today – what do you call that?  Up 420 in a week?  I think we’re good…  Still might pull off the rest of that 2% move into the close though – why not, they took us this far…   


    Recession fears/Angel – VIX is 16, I think they are ebbing kind of fast.  

    CCJ/Rain – I like them long-term, whatever they do.  

    Good list JRW.  

    Kudlow/Otto – Like nails on a chalkboard!  

    Oil came down nicely to 94.74 but don’t be greedy, they just broke 74.60 on the Dollar!  


  82. Troy (^_^)

    Welcome back, IWM 83,80 and 84.32

  83. Phil
    June 30th, 2011 at 7:17 am | PermalinkIgnore this user
    we’ll be starting the $25KP with a fresh $50K of cash next week so that should be fun into earnings
    Phil – Count me in…thanks Phil! 

  84. Is there an agreed upon way to draw an up trend / down trend -
    On a down trend do you use the absolute top or the highest close?

  85.  Phil/UUP – What do you think of buying the August UUP $21 calls, and selling the $21 puts as a play on the dollar moving up from here?

  86. JRW - another 450k IWM "save" at 12:15…you would think they would at least shuffle the volume!
    Phil – Hey can you check if the "Troy" PSW account in the records is an active member?  Decided "(^_^)" looked better than "(_!_)", but simply "Troy" would look even better, plus easier to login…=)

  87. samz / trend — It’s looser than that. More like an art form (or voodoo depending on how you look at it :) The more points you have, the less concise each needs to be and the volume of points helps to confirm. Phil had a good saying a few weeks back to think of the lines as trampolines, not absolutes. Nice visual Phil!

  88. matt, takes a lot of money and manipulation to keep markets elevated. Its only a matter of time and with everyone leveraged to the hilt…its going to be a blood bath. Who in their right mind thinks Gov around the world can sustain the last 3 years of debt expansion. Call this the last hurrah.

  89. Out of TNA with 10 cents !!

  90. Well, that chart was a buffer-blower!  No wonder I don’t usually use it…  

    WFR/Rev – Sad that you won’t get to own it.  

    Commodities/Leon – Well I’m sure you realize I feel you should abandon that ship.  Also the anti-dollar could be another nightmare – it’s another bet in the same direction.  You had a fantastic run, why not get back to the dreaded cash Dollar for a while?  With your restrictions, you can’t do anything too fancy so all you can do is bet against yourself and guarantee losses – not much point in that, is there?  If you are not going to cash out, I would strongly suggest a dollar positive (UUP) or oil negative (USO) play to cover yourself because, if the Euro falls apart, the Dollar can fly back to 80 and commodities can go limit down over a weekend on you and if you’re not trading futures, then Asian funds and EU funds can be liquidating like crazy before you even get out of bed.   Greed is keeping you in this trade, you were greedy as the Dollar went from 72.95 at the end of April to 76.16 in late May and then you caught a huge break as it went back to 73.89 in early June but you left that on the table too and rode out a move back to 76.50 last week and now we’re back at 74.60 and I’m not going to be your enabler – you should be thanking God you got a 3rd chance to get out.  If you want to be long – we can chat over the weekend about some sensible long positions but being gung-ho long on commodities now is a total gamble and NOT the kind of thing to do in a 401K unless you are so rich that that’s just your gambling money (but then I assume you wouldn’t be worried enough to cover).  

    94.48 on oil – the Dollar dive is masking some serious weakness!  

    74.60 held again!  

    Fraud/Matt – Well we know that but that’s why I keep telling you to just go with the flow.  You have a very predictable opponent – you need to use more judo and less sumo…

    More corn/Rain – Gee, what a surprise – the price of corn doubles and farmers plant more of it.  Who’d have thunk it?  That’s why speculators crack me up.  They extrapolate outcomes that never come to pass and it’s the same cycle over and over and over again and EVERY TIME they say "this time it’s different."  Right on dumbness too – it’s like a fad.

    SQQQ/Bob – The more conservative move is to roll for time and that’s a better move if you have a hedge as now the gain you made on your longs is also a hedge (profit cushion) so you don’t have the same pressing need to protect against a slide you had before.  The July $25s are .80 and you can roll them to the Aug $26s for +.70 and you know the July $26s are likely to expire worthless (now .55) and then you can roll them if you have to to much higher Aug calls or, if they expire worthless, you can sell something else for the .70 extra you spend (currently the Aug $30s) and then you’re set up for another month with a wider spread at the same net .50.  

    $93.97 oil and the Dollar is only at 74.62!  

  91. Phil—based on your premise for next week would you get out of the short aapl 340 7/16 puts for a small gain?

  92. Troy (^_^)


  93. oil reversal..hedgies can not have that at end of q!

  94.  Hi Matt and All -

    "Phil / Rally / What Kind:  A Fraud.  There simply has to be collusion in this market between the big IBs.  It probably occurs when they confer every morning with the Fed!  And that is no lie.  It happens daily.  There is NO selling occuring.  They can put the needle where ever the friggin want.  Whenever they want."

    That is exactly what they do, according to Lee Adler – I couldn’t believe it when he was telling me, these guys are so clearly yanking the market around where they want it, and not even trying to hide the fact that they do this. Concepts like free market, supply and demand, value, efficient market pricing etc. can be tossed out the window. 

  95. FAS Money / Phil
    For the roll of the weekly short 24 calls, I would buy back the current weekly 24 calls (currently 1.87) and sell the next weekly 25 calls (currently 1.14)?  Since there is still 5c or 6c in premium in the weekly 24 calls, I can / should wait until tomorrow to roll?
    Is the ‘Theory’ of the trade that as long as we sell premium on both the call and put sides week after week, the ‘losses’ on some of the rolls will not matter?

  96.  global debt ponzi scheme…china the last buyer…what happens when they cant buy anymore?
    i think they are aking an assumption about collateral…quite funny worse yet is that they believe they might be hedging

  97. Testing 82.82 as a floor again; buy the winning direction !!

  98. Phil – thank you for the wise words, as always.

  99.  Phil: American Exceptionalism
    definition: Scared white people with guns is what built this country:  Were you a history major?

  100. from bespoke: Net analyst revisions for the S&P 1500 are down 9 weeks in a row. Last time that happened was in Oct 2008

  101. JRW
    I have a up down at 82.93.

  102. Over EMA but that’s it, maybe better not to play.

  103. Retail buying from wholesale sellers.

  104. Phil…..E Mailed (you) a personal thank you to admin@philsstockworld under livingfull…have a great Fourth all. 
    Outta here…..back near the end of July. 

  105. shadow,

    It is tough trying to make money at 45 cents a trade !!  8-)

  106. Phil:  I am  still in the QLD 77/81 bull call spread in 25KP. Is this a good time to exit it?

  107. Ilene, I knew I had read about the IB / Fed meetings somewhere!  It was from your interview.  Which I printed out to save.  Hopefully we’ll see his prediction for them dropping the equity market to prop up the treasury market soon.  Guess they won’t have to do that though until yields start to rise.  But with Europe ‘fixed’, maybe that will come soon.  However, read today from a European who was saying that treasuries would remain low BECAUSE of Europe’s mess.  Guess he didn’t get the memo about Greece all better.  Nor our little debt ceiling problem! 

  108. JRW
    45 cents would make my day, so far 10 cents – comm.

  109. Intraday SPY looks like a "muffintop"……  Mmmmm Blueberry>

  110. Phil / Chicago Kansas #’s good, NY#’s bad why the disconnect?    Keep reading about the stretched consumers, but the mid/high end restaurants are packed.  If next week’s ISM and employment #’s continue the Chicago/Kansas trend, ‘they’ could push this rally some more?

  111. Phil, 
    Similar to above SQQQ hedge questions: I have the July 28/31 for net .70 with the 26 puts for 0.65 (Net .05 on the spread). Just leave alone and roll the puts if necessary or adjust down on the long and caller?
    Also the TZA 38-42 for 1.90 offset with the Aug 113 DIA puts (1.53, now 0.53). 

  112. oil and gas back in the black..!

  113. Phil / Oil play   Do you think the reserves release will be used to stick it to the traders over the long weekend?  Place and hold shorts through the weekend at this price?  Gov’ts now have a huge interest in getting oil prices down.

  114. hey if any one cares i ithink the rise in pork, rice is destroying the "china taking foot off break argument"
    spot ag getting killed today and rice limit up..go figyah

  115. Good example of squeezy triangle thingy Rain:  

    SPY/Gmarts – Yep, my bad, I forgot they had todays.  No harm, they are at .30 already so a stop back out even at .25 and hopefully they make enough to flip to tomorrow $131 puts (now .23) for net free.  

    TNA/JRW – Well we were on different pages there.  

    74.60/Angel – I only look at /DX, TOS doesn’t do /DXY

    FCX/Rain – Well I super-doubt FCX drops 15% in two weeks so no in the low-touch Portfolio but, for active trading, of course you move on at this point.  

    TZA/David – I’d roll before doubling down.  You already let those get way away from you, now $1.80 and you’re talking about spending a lot of money that will be all premium – that’s never a good practice.  I’d sell the Next week $35s for $1.05 and spend $2 to roll to the Aug $33 puts at $3.80 so you’ve spent net $3.90 to be in a $3.80 call and you can stop out 1/2 the $35 calls at $1.50 and then you would be 1/2 covered at $4.65 after TZA starts moving back up and then you can roll the caller as needed to widen the spread.  

    First day/Lotter – Very good chances we go up more tomorrow.  That’s why we don’t want to over-commit to shorts today but this is a very unnatural run and I think the fund buying will be sold into tomorrow, which is why I’m concerned next week could be a disaster.  

    $25KP/Goldman – Get ready for a wild ride.  I suggest you read through the old posts to make sure you know what you’re in for – it’s a VERY aggressive Portfolio.  

    UUP/Palotay – I like that idea a lot.  

    Man that RUT buy at 12:52 was huge, I can only note JRW’s 12:51 comment and wonder…

    Troy/Troy – Just try changing it and see if it lets you.  I don’t recall any Troys but could be a Report Member we never talk to.  

    Voodoo/Rain – Yep, that describes it quite well.  

    AAPL/Savi – I would think they move up into earnings but my general nervousness on the markets says I would take it and run rather than risk it over the weekend.  

    Out the window/Ilene – Only over the short run.  Over the long run, value is discovered.  Someone can only sell the Brooklyn Bridge to people until it comes time to see the actual paperwork – that’s what this game is too – they sell you a vision of better earnings, more demand, tight supplies, etc. but, over time, they can’t deliver it and the whole thing falls apart.  From a fundamental point of view, it’s just a matter of getting the timing right and remembering Galbraith’s warning that the markets can (and often do) remain irrational FAR longer than you can remain solvent.   Keeping that in mind keeps you from ending up in a red box like Matt!  8-)

    FAS Money/Pete – Yes, I would wait until tomorrow.   It might get worse but I think we’re stretched and XLF may correct back to $15, which would be a great win for you.  $15.25 at least I would think.  And yes, if you sell $21 worth of premium over 18 months – all that matters is how far off you are on that last sale.  Some weeks you’ll sell $1.50 in premium like last week because the week before was on target and some weeks, like the one coming up, you will sell no new premium but you’ll roll your $1.80 caller to a put and call combo that is $1.80 or better.  So you are not taking a loss, just skipping a week of premium collection.   

    China/Angel – Anything involving them is unpredictable.  As I’m sure you realize, Chinese people don’t even think the same way we do.  They are generational thinkers and there is just no way you can really understand the mindset in a society where almost every single person is the only child of an only child – it’s so completely removed from our experience that it’s almost pointless to contemplate.  That’s why it’s funny when Americans try to "get into" the Chinese mind-set.   So they are not actually unpredictable – they are just unpredictable to Americans – we’re the ones that seem crazy to them…

    You are welcome Leon!  

    FSLR/Rain – Yep, that’s what gave them their ill-gotten gains.  It never occurs to investors to wonder if FSLR makes any money at that price.  This is their typical pattern, they low-bid projects, run up the stock price and try to figure out how to produce it later.  Thanks to Moore’s law, it’s actually been a good strategy for them but one day they will hit a wall and there will be hell to pay.  Because of their need for tellurium – the worst thing that can happen to FSLR is a decline in copper demand as tellurium is a very tiny by-product of copper mining and FSLR already uses about half the World’s supply.  That’s why no one else makes solar cells out of it, even though it’s more efficient – it’s like a Russian roulette game as to whether or not you can deliver on orders, let alone expand your market.  

    History/Lincoln – Actually my roommate was and my Uncle taught history at Cambridge and his daughter (my 1st cousin) is one of the World’s foremost experts on Byzantine culture, but I was referring to the video’s premise.  

    I haven’t seen it yet but you’re welcome Living!  Have a good holiday.  

    QLD/Etrad – Hell yes it’s a good time to exit!  We’re done being bullish folks!  

  116. just in the last week china has gone from "tightening measures are working" to "7% cpi by next year".

  117. ".. Hopefully we’ll see his prediction for them dropping the equity market to prop up the treasury market soon.  Guess they won’t have to do that though until yields start to rise.  But with Europe ‘fixed’, maybe that will come soon.  However, read today from a European who was saying that treasuries would remain low BECAUSE of Europe’s mess.  Guess he didn’t get the memo about Greece all better.  Nor our little debt ceiling problem! "

    I’ll let you know if anything in his analysis changes, but keep in mind the POMO money is also coming to an end (I think there are two influsions scheduled for July). Without this money, it should be harder to prop the market up, unless/until they pull out some new sources… 

  118. first off phil it wasnt moses finley was it or ronald syme..i studied classics and was at cambridge in the early 70′ far as the chinese go i believe that much of what i happening there is the result of long range scheming..they seem incapable of honest dealing at many levels i ve had a couple chinese partners and they trusted no one except their families..brilliant hard working..very i htink you ar eright about the mind set..just discount nearly everyhitng they say or publish…pathological inclination to theivery and an amazing mistrust of anyone unlike i think its about to blow up in their faces..we’ll see..inscrutable!

  119. first off phil it wasnt moses finley was it or ronald syme..i studied classics and was at cambridge in the early 70′ far as the chinese go i believe that much of what i happening there is the result of long range scheming..they seem incapable of honest dealing at many levels i ve had a couple chinese partners and they trusted no one except their families..brilliant hard working..very i htink you ar eright about the mind set..just discount nearly everyhitng they say or publish…pathological inclination to theivery and an amazing mistrust of anyone unlike i think its about to blow up in their faces..we’ll see..inscrutable!

  120.  PHIL:  "Keeping that in mind keeps you from ending up in a red box like Matt!  8-)"  LOL, I think I’m one shade away from a red box like Matt already. 

  121. Kinki - did you get some TBSI with me last month after our chat?  I’m loving that action on that one this week…

  122. Bought July QQQ 58 puts only .25 permium.

  123. ilene / red box — Yes, but matt has a tin foil hat as well! :)


  125. Phil / 12:51

    I’ve made 45 cents 3 times since then !!  (Silly little chanel IWM 82.82-83.01)

    I’m currently 100% TNA; this may be the push !! (Pullback will have to wait for tomorrow or Tuesday) 8-)

  126. Phil,
    I cashed out all positions except "Mrk Vectr Jr Gold Miner E.T.F.", expecting gold to jump with the down turn in the market.
    What is your opinion on keeping or selling?

  127. JRW - USO and TBT are also in channels since around noon…looking like a breakout of those channels soon. Only hit 43 cents once so far, but I started late today.  I’m playing with FOK and IOC limit orders on entry…tricky tricky but at least I’m not getting scalped today!

  128. Now CNBC is attacking Obama for questioning tax breaks for corporate jet owners. 
    This channel is relentlessly right wing all day, every day, and I cannot believe anyone would argue otherwise.

  129. Per CNBC – Obama is picking on the corporate jet set.  Oh the humanity!  I wonder if GE makes jet engines….

  130. Hi Phil — I have July 35 short put sold for 2.7 — should I take money and run end of day today and sell some short put TLT like July 34 short put. thx

  131. Hi sorry TLT july 94 short put

  132. Phil / Oil   Just couldn’t resist shorting at $95.67!   I’m worried about a good ISM tomorrow given apparent correlation with Chicago #’s, so probably out by end of day.  Advice?

  133. Rally getting it’s legs back with Dollar at 74.65 – oil making it’s run-up into the NYMEX close (2:35) and will be a juicy short back near $96.  Gold going the other way at $1,501 lets you know the oil move is BS.  

    Muffintops/Gmarts – That never works.  

    Disconnect/Tusca – Hard to say.  You can never go by one report of anything but, of course, they may have different methodologies – especially if they are counting inflated prices as some kind of positive.  If we keep getting good numbers, we should get a relief rally, of course.  We won’t know for sure what’s happening until that first week or two of earnings is past us.  

    SQQQ/Amatta – You always wait until it’s way late.  The July $28s are just .25 now with SQQQ at $25.  On Monday they were $1.69 and they went down and down all week.  On the other hand, the short $26 puts are now $1.70 and they were .45 on Monday – you can’t play these trades if you are going to just watch profits melt away until they are losses.  Now it’s a loser on both sides but at least you can get .25 for the calls off the table and leave the puts and the short calls and you can hope you get some improvement that let’s the puts expire worthless without triggering the short calls.   TZA is the same thing – the bull call spread is worthless now but at least the DIAs should expire worthless.  

    Reserves/Tusca – It’s not like they’ve actually delivered a single barrel of oil from the SPR yet.  The idea of releasing the reserve is to create a plentiful supply.  Speculation is based on fear of shortage.  They rallied oil this week on a 4.2M barrel draw, 2.8Mb of which was caused by lack of delivery – it’s nonsense.  Now the SPR will put barrels on the market but how many per day is the question.  Hopefully it will be 1Mbd for a month and not 500Kbd for 2 months but haven’t seen a schedule yet and neither have the people who are betting.  

    Rice/Angel – They have to make money somewhere.  When the corn myth is debunked, it’s rice’s turn to have a "shortage."  Rice was the last commodity to go up in 2008 too – it’s what finally broke the backs of the Asian economies so of course they will do it all over again like freakin’ idiots.  

    Cambridge/Angel – Cool, didn’t know you had that background  It was David Webb, same last name a Ruth.  Not sure he was that far back – you’re much older than me!  ;)    Anyway, discussion for another time on China.  Keep in mind they have a different interpretation of what constitutes ethical behavior.  Many Asian people "lie" to be polite.  I’m sure you know Japanese businessmen will go to tremendous lengths not to say no, even when the answer is "no way."  Westerners don’t understand that little nicety and Chinese people are as incomprehensible to Japanese people as the Japanese are to us.  China is all about duty and family – anyone outside the circle is essentially an opponent and there are many Chinese games in which cheating is how you win.  Don’t blame them if you don’t know how to play…  

    Well Ilene, I do have to warn you not to be too bearish sometimes, don’t I?  

    By the way, for those of you who haven’t been here that long.  Matt earned his red box by steadily being much more bearish pre and during the big crash in 2008.  He was right and I was too early calling for a recovery and Matt is always a great reminder that there is always someone else who may see things that you don’t. 

    Good time to start shorting oil again below the $95.50 line on /CL.  


  134. This is so tipical, everyone was expecting a w-4 down (including me) !!

    Almost 2:30, here Sticky Sticky  8-)

  135. stick with no volume – not sure what that means – guess entire day is a stick 

  136. Nice going JRW!  I’m not worried about you, I know you’ll be in cash overnight so que sera sera, right? 

    Gold/Chas – I think the junior miners get hammered if gold breaks down and its weak on a weak dollar so you are playing with fire.  If we are still over our Must Hold lines the week after expirations (week 2 of earnings) then I’d say it’s a good time to go long again.  

    CNBC/Esco – Yes, the arguments against that one is astounding.  You can see how we’ll never make progress when they are willing to fight tooth and nail to subsidize corporate jet travel – it’s almost pointless to try…

    Mystery put/Gucci – Well their at $94 so not worth the risk is it?  Too much uncertainty and they were $1.68 this morning so shouldn’t you be thrilled to get out for $1?  

    Good short Tusca.  It’s working so it’s all about taking a non-greedy exit before bed-time, I think.  Keep in mind below $95 is our normal shorting spot and we got a nice $1 run last time so we’ll see what happens now that the NYMEX is closing but more likely we float around this line.  

    Dow volume 90M at 2:45 – still lame and easy to stick.  74.60 line is key for the Dollar – below that and it’s rally time. 

  137. Has CNBC mentioned anything about Greece today?

  138. very interesting on the chinese you are exactly right about the japanese psyche vs chinese psyche..and i think the problem for the chinese now it that everyone is growing weary of their business practices..i’ll tell you some stories sometime…they have a few trillion but that doesnt buy them the respect they so keenly desire..and hanging with iran and north korea..not going t help..not to mention iran..they have very little belief in their own story(hmm i wonder why) and the way the elite are gunning money off the mainland to the west is a big insight…i think thye are in significant trouble and their off balance sheet crap is going to be quite the shitburger for all of us

  139.  Angel:  Everything you’ve said seems right, but they do have a USD $2 Trillion surplus.  If the U.S. could engineer a "stimulus based recovery" for a time, in the face of huge deficits, couldn’t the Chinese keep the party going for quite awhile?  That’s why I’ve shied away from shorting China.

  140. GLW appears to be another basing stock mentioned here. Big options volume:  43k Aug 19c’s

  141. Hi sorry again… TBT July 35 short put sold for 2.7 now about 1.05…take money and run then open new position --sell  TLT July 94 put

  142. Phil — On TLT, would you sell calls, and, if so, where?  I’m thinking maybe Sept 97s, for around $1.00.

  143. sh*tburger? That’s what I get for trying to short against end of month / quarter money flows. 

  144. Legged out of 2/3 of my TNA for the same 45 cents, not enough to break through, 1/3 to go !!

  145. Going forward…
    ‘Their’ goals:  1. Make money.  2.  Try to make sure that as few others (that’s us by the way) as possible make money.  3. Keep the current system (extend and pretend).
    The only scenario that fits all those goals is a large drop in the market, bonds, commodities, followed by QE3 and a large rally.  Basically repetition of last year.  Without fresh printing, bonds will fall apart by themselves (at least 5yrs+), commods, although not retarded high anymore, still very far off natural supply/demand pricing.  Equities are just simply manipulated higher, but without fresh printing it would be harder and harder to do.
    So far everything except equities is starting to price in the end of QE2.  Equities seem to be driven for Q end to suck new dumb money in.
    I suspect that once that money is spent (week or so), perhaps earlier we will see a big liquidity sucking operation, everything gets hammered, stocks the most.  Once panic selling starts and assets are once again transferred from ‘others’ to them, the QE3 will come.  Timing is hardest to guess, but end of summer seems about right.  What happens then we all know.
    This way goal #1 is maximized, #2 is doing well, and #3 is achieved for the time being.  Alternate scenario of pushing market higher is a lot tougher, #1 is a lot worse, #2 is simply not met, #3 is doing well.  30% down followed by 50%+ up is the gravy.
    Hope Phil will sniff out timing better than anybody else as usual.  Just if I am right listen to Matt this time around :)

  146.  Another Lap around, then!

  147. Phil, I was right and I would have continued being right if it weren’t for our government’s intervention in the stock market on March 9th, 2008 and pretty much every day since.  There have been MANY people made poor doubting our government’s willingness to subvert the free market.  I dunno.  I just figured we were the champions of free markets and we just wouldn’t go there.  But what has happened will continue to happen by every president of the Fed and US from here on out.  They will not be able to keep there hands off it.  What once was a moral hazard is now a moral trainwreck. 
    Rainman, if all this isn’t coming in loud and clear to you.. switch to Reynold’s Heavy Duty!

  148. Greece/Rain – What’s that?  

    LOL Angel – You may be right but, so far, they sure have wrangled some impressive growth numbers, haven’t they?  

    GLW/Rain – I love those guys.  Shorting the 2013 $17.50 puts for $2.70 is just net $3 in margin – a great offset as they are well-worth $17.50.  As a conservative entry, I like the 2013 $12.50/20 bull call spread at $4.20, selling the $17.50 puts for $2.70 for net $1.50 on the $7.50 spread that’s $5.50 in the money to start.  Break even is $15.75 and worst case is you get assigned 1x at net $19.  

    TBT/Gucci – If you are up more than 50% with more than two weeks to expiration, you should have very tight stops (20% of the profit or less).  So, you should not be asking me this question as they were .67 this morning and you were up $2.03 so the stop should have been .40 at most!  Once we get into next week, we look for 70% to kill a short contract ahead of expirations (ones that we are not 90% sure will expire worthless) and, even during expiration week, if we’re up 85% we need a damned good reason not to pull the short contracts.  Since we expect the market to go down and that will panic people into the dollar and probably knock TBT back down to $32ish again – maybe wait until next week to re-sell.  

    TLT/Esco – Same as above – I’d wait until possible dollar rally that shoots them back up and then sell.  

    QE3/Lapper – We can only pray that’s what they do as we are ready to take full advantage of it.  As you said – it worked so well the first time – why not do it again?  

    Reynolds/Matt – ROFL!  

    Dollar being held down in a very unnatural fashion and it’s not helping the indexes at all.  I am getting more bearish despite all our Must Holds holding…

  149. They are doing a World Class job of holding this market up today at the levels they need.  Market has gone up over 400 points on the excuse that Greece is not fixed but let’s pretend it is.  Will there ever be a time when anyone in congress, the SEC or a DA’s office will push to have High Frequency Trading Programs outlawed since it is nothing more than illegal frontrunning?  Not too mention blatant manipulation of the markets giving unfair advantages to IB’s which is what the SEC is supposed to prevent.  Wonder if you’d see 3 months of profitable days for Goldman, JP Morgan and BofA if the HFT’s were gone.  By the way, I’m short the market if you couldn’t tell.

  150. Again, buy the trend at IWM 82.82 !!

  151.  Tusca: oil short
    did you hit that top @95.67?  very impressive

  152.  Bloomberg writes of a proposal from a European research group [Bruegel] to create a common European bond into which Euro countries could fold up to 60% of GDP, [a "Blue bond]  and each country would also issue a Red bond on their own credit with a presumably higher yield, giving them an incentive to cut back.  If Germany is willing to shoulder the burden, closer fiscal integration could resolve Europe’s debt crisis.  Whether it solves their economic problems long term is another matter.  But if Germany makes encouraging noises, the dollar will get crushed.  I’m short Euros, and live in fear of a generous and reasonable Germany.

  153. zerozero we dont know that at all in terms of "their" 2 trillion that is inflated i am sure.. these are not people who say .its .this big if they can leave you believing NO ITS THIS BIG!..they obtain most of their cache in th egeopolitical sense though the perception of their massive success story..they now seems t be changing their stories dailiy ..have contrived leaks out of state backed media and seem to me to be in massive trouble..they are not well liked and spend alot of time with world class do the math..if they are so full of confidence and promise why do they slink around with such pariahs..i simply don’t believe the story..thats just the way i see it..i am short eem ewh and fxi..and will get shorter i am quite sure..

  154. All / Euro   Do any European based members understand how EADS can compete with Boeing at these exchange rates?  Every time I travel to Europe I find it too expensive and wonder how European manufacturers can compete?

  155. Congrats JRW
    I saw the channel. Way too many care for Mom and Dads today. Do you think it will work one more time I am back again till close?

  156. JRW, I just bought for a stick up, that’s usually a good time for TZA for you!

  157. Mr. M

    Say it ain’t so !!

  158. shadow,

  159. Phil / Oil   The $ is crazy low, so I’m tempted to hold my oil short overnight and sell before tomorrow’s ISM which I think could surprise on the upside and goose the mkts again?

  160. matt
    If your gona be a bear, BE A GRIZZLY!!!!!!!!!

  161. Angel, I agree entirely regarding their national character.  They are indeed slinking Commies whose profits have been derived from a massive labor cost advantage [coupled with lots of social control mechanisms] rather than having discovered a "Third Way" to do capitalism. The same stories circulated about the Japanese in the ’80s – "Theory Z" and much other tripe.  On the other hand, their Commie bureaucrats have every incentive to keep the party going, and if they decouple from the dollar — they are now in the process of "modifying their trading band against the dollar" — everyone will lend to a China with a rising currency.  If you and I have a difference of opinion, it’s about timing.

  162. lapper / matt -- As lapper said, timing is the problem. With so many predictions for the fall, which seems to be the best fit IMO, I’m thinking it won’t happen then and markets will be propped up into the fall. The biggest problem I have is the amount of clout that can be used to force asset movement and a potential stealth QE. If speculation gets crushed, where do those assets go? Won’t the banks take on the roll of the fed and buy treasuries for their reserves, perpetuating the circle jerk? We know they have been shoring up their reserves. I don’t like betting against the Fed and I don’t like being 50% cash. I continue to try and stay agnostic and balanced but would like to allocate more assets. The biggest problem I have is the low VIX and scepticism that we can make the transition from increased margins to increased sales.
    As far as tinfoil hats, who needs one when you have this trading room!

  163.  Its stick! Must be a day with a "y" in it!   Its funny i teach Corporate Finance law over here in London and try to get my sudents to understand the markets from an independent view and they always fight me when i say the markets are a rigged casino …. free markets must still  be a module at English Universitys! lol

  164. Bought a few more QQQ 58P

  165. This is too silly, 3+% on the day; see you all tomorrow !!

  166. 12:25 PM Bon voyage, QE2: Today’s Fed purchase of $4.909B in Treasurys (of $12.469B offered by dealers) wraps up the central bank’s asset purchase program – for now. Look back on it (fondly or otherwise)in pictures. St. Louis Fed’s James Bullard says the plan "worked in reality." But with stocks up strong, so are yields: the 10-year yield +0.06 to 3.164%; five-year +0.08 to 1.754%.

    03:00 PM On the hour: Dow +1.05%. 10-yr -0.36%. Euro +0.55% vs. dollar. Crude +0.3% to $95.05. Gold -0.66% to $1500.40.

    June KC Fed Manufacturing: M/M Composite index 14 vs. 1 in May, production index 2 vs. -22, employment index 17 vs. 9. Producers are generally optimistic about future activity. Raw materials price indexes fell for the second straight month, but more producers say they plan to raise selling prices in the months ahead

    Grain futures are getting pummeled in wake of the bearish USDA report. New crop wheat futures are off 7.4%, and corn might be down just as much if not for price limits. Beans are spared the worst of the carnage. JJG -6.6%CORN -8.5%.

    KC Fed President Thomas Hoenig stays on script, saying the Fed’s loose monetary policy endangers the economy to asset bubbles. The outgoing FOMC-voting member and chronic dissenter adds: "Extended zero-interest-rate policy is producing new sources of fragility that we need to be aware of and allow for in our future policy choices." (.pdf

    Hit and RUN!  A report surfaces that Tim Geithner is considering leavingTreasury after finalizing a deal to raise the debt limit.

    This week’s strong rebound in chip stocks (SOXX +2.5%) could indicate a subsiding impact from the Japanese quake and that demand has started to improve, Dave Kansas writes. Today: INTC +3.5%AMT+3.2%TXN +2.8%AMD +2.5%QCOM +2.3%. Yet Micron (MU +0.6%), especially sensitive to supply/demand issues, lags despite an S&Pupgrade

    Tim Duy points out some grim jobs numbers: The U.S. economy remains ~7M jobs shy of the previous peak. At an optimistic 200k jobs a month, the peak is regained in 35 months. Now 23 months into the "expansion," consider that the average post-WWII expansion is 59 months. In a typical expansion, we would enjoy just two months of job growth beyond the previous peak before the next recession.

    May home prices, including distressed sales, +0.8% M/M, -7.4% Y/Y, CoreLogic reports. “Two consecutive months of month-over-month growth and continued relative strength in the non-distressed market segment are positive seasonal signs in the housing market," according to CoreLogic’s Mark Fleming. 

    "There never was a housing recovery," says Pimco’s Scott Simon responding to a question about a housing double dip. If politicians were to actually make good on threats and weaken government support for the market, things could really start to get ugly.

    What’s been witnessed over the past days is a farce, writes Daniel Hannan. The EU/IMF knows Greece can’t possibly raise €50B with privatizations and can’t grow without devaluation. Once banks unload their exposure to Greek debt onto governments, Athens will default.

    Concern about Greece and other sovereign debt issues prompted large institutional investors in money market funds to pull their money during the past week at the fastest pace in 15 months – $39B in net withdrawals, $75B in the past two weeks. Institutional money funds that buy just U.S. government-backed securities gained $27B in net deposits. 

    The ECB’s Nowotny tells the Greeks this week’s vote was just the start. "More steps need to follow … (privatization) must be quickly implemented." Trichet tells public sector workers their wages will become more in line with the rest of Europe. Good ideas all … having unelected bureaucrats dictate them to your country … not so much.

    WIth Christine Lagarde off to the IMF, France’s new finance minister, Francois Baroin will deal deficit/GDP of 6% and debt/GDP set to hit 87% in 2013 – higher than Spain and Iceland, and 2nd only to the U.S. among AAA-rated countries. Making the tough cuts will be difficult ahead of elections next year. 


    Given the plight of euro zone debt and Greece’s woes, Pimco’s Mark Kiesel makes a case for the four U.S. bank behemoths to lead the way among global players: “Most U.S. banks have turned the corner and over time appear well-positioned to be able to meet the higher capital requirements under Basel III." Today: JPM +0.9%C +0.4%WFC +0.1%,BAC -1.5%

    The greenback doesn’t know what to make of the powerful Chicago PMI. A stronger economy is supposed to send a currency higher, but "risk on" means the dollar must fall. For now, the greenback remains somewhat lower, with the outlier being a powerful move up against the swissie. FXF -0.9%UUP -0.2%

    Seems that there’s still love for housing in the U.S., as 89% say homeownership is an important part of the American dream, according to the latest NYT/CBS News poll. Despite all the problems, a persistent belief endures that the market will eventually improve and housing will regain its traditional importance. 

    Didn’t I just say this?  "The worst decision we ever made," says a BofA (BAC -1.8%) director of the board’s attempt to catch a falling knife with the Countrywide purchase – saddling the lender with $17B in losses to this point. In a ripping market, BAC is down again, giving up yesterday’s settlement-related gains. Caveat emptor.

    Yahoo (YHOO -0.6%) shares turn lower on news that police in China have detained 36 people as part of an ongoing investigation of fraud at, of which Yahoo owns a 40% stake. Shares had been higher following Needham’s recommendation, which noted that YHOO is "well-positioned to solve several of the biggest issues slowing monetization of the Web."

    A tale of two web sites: Possessing roughly 4x as much U.S. traffic as Facebook five years ago, MySpace has been left in the dust by Facebook, leading to News Corp.’s (NWSrecent decision to sell the business for a fraction of its purchase price.

    Juggernaut!  Apple (AAPL) is looking to ship 12-14M iPads in the calendar third quarter, according to DigiTimes’ sources. That would be nearly 3x as many iPads as were sold in Apple’s March quarter, and also a solid jump from the 9M iPads Needham’s Charlie Wolf believes were sold in Apple’s fiscal Q3 (ends today).

    There are now over 100K iPad apps available on Apple’s (AAPL) App Store. By contrast, the number of apps optimized for Google’s (GOOG) Honeycomb is estimated to be "in the low hundreds." In the absence of a handicap such as the iPhone’s AT&T (T) exclusivity deal, the iPad’s app lead will be a difficult challenge for Google to overcome.

    Three lunchtime reads:
    1) Halftime for the bull market
    2) How to get the U.S. recovery back on track

  167. zerozero right..but keep in mind i dont actually believe their communism is much more than an excuse to sing the national and hob nob with others of thier ilk….i think their national character is as phil said earlier genetically sealed..the problem for them is that it was easier to control the party without social media and the speed of they are stumbling to keep up with their own pronouncmenets day to day and have no effective pr apparatus..otherwise who is leaking the fact that a couple hundred billion of private wealth is rolling out of china….so i think the unravelling will be much quicker than anticipated..and the fact thier ‘elite’ are e leaving is special indeed.

  168. Sorry, guys, I was Mr. Stick Killer today. Tomorrow should be interesting!

  169. Got USO 36 puts for .37 at close.

  170. Bought some IWM Aug 81′s and 82′s (Puts) fwiw !!

  171. geithner said to consider leaving..please do tim….adieu rookie..this help o alot

  172. And, yes, for the record I did miss the last 15 minute 45 cents  8-)

  173. And wheeeeeeeeeeeeee into the close! 

    Dow volume finishing at 174M once again half the volume for the day in last 15mins.  Dollar 74.68, oil $94.96 and everyone is over their lines so all must be well, I guess. 

    And you were keeping it so well hidden Rustle…  

    EADS/Tusca – That is a mystery.  

    You are smart to not play when distracted Shadow!  

    Oil/Tusca – You can hold it as long as you can look at it but the after-hours trading can be nasty in the futures.  

    Nice crash pad Rain.

    Free Markets/Malsg – That’s interesting.  I assume it’s just the general lifetime of programming they get from the MSM etc.  I see the same thing here – the kids don’t believe anything the government says but if Jim Cramer says it, it must be true!  

    Good calls JRW – grinding them out very nicely.  

    Elite/Angel – You can’t think of their elite as static.  Think of China as a ghetto and the leaders as drug dealers and pimps and they profit off the misery of their neighbors until they get successful enough to be able to move their game uptown.  That creates an opportunity for others to climb the ladder and repeat the cycle.  The US has 412 Billionaires (out of 1,200 in the World) and just 300M people (more than 1 per million), China has 115 out of 1.4Bn people or one in 12M but China’s GDP is 1/3 of ours so they should have (or will have) 4 times more Billionaires so you can expect to see what will seem like a MASSIVE amount of wealth leaving China on a regular basis and there will be nothing that is either strange or disruptive about it.  Keep in mind if just 1% of their GDP is accumulated and eventually taken out every year – that’s enough for 500 people to take $1Bn EACH out of the country this decade.  

    OH NO – It’s GREENSPAN!!!

  174. BoA/Countrywide / Phil – Absolutely stunning. Only in the bizarro realm that is the US economy. Is that kind of total ineptitude covered by the board’s "errors and omissions" insurance?

  175.  That makes me bullish…
    Key paragraph:

    Between the second quarter of 2009 and the fourth quarter of 2010, real national income in the U.S. increased by $528 billion. Pre-tax corporate profits by themselves had increased by $464 billion while aggregate real wages and salaries rose by only $7 billion or only .1%. Over this six quarter period, corporate profits captured 88% of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1% of the growth in real national income. The extraordinarily high share of national income (88%) received by corporate profits was by far the highest in the past five recoveries from national recessions.

  176. Today’s levels

  177. Phil, 
    Aren’t we expecting a selloff? So on SQQQ why wouldn’t I roll to Aug 27/30 from the July 28/31 for .35? So I’d be in the spread for .40…. And the 26 short  puts who cares as you say, are we in July yet? So if we are expecting a selloff those would be back in business in no time…. Why do you consider it a lost cause in my case but offer sensible solutions to Drumm an others?
    TZA I could roll the 20 July 38/42′s to the 35/39′s for .80 and sell 15 HPQ Aug 36 Puts for 1.05 and still be in the spread for net .40…

  178. Carson Block on SINO: 

    "Yes.  Let me say two things.  Number one, it is Sino-Forest’s management that participated in the fraud that has cost Paulson and investors all that money.  No. 2, yes, I’m just as certain today that the company is a fraud and the stock is zero as was on the day that we published."  

  179. Travel question for our left coast members- I am considering a motorcycle trip up the CA coast highway (LA to SF and perhaps a side jaunt to Yosemite)- mid  to late September- I don’t think your rainy season starts that early. Generally could I expect more summer like conditions along the coast? What about to the mountains/Yosemite?

  180. Last week of April up, first week of May down. Last week of May up, first week of June down. Last week of June up, first week of July ? The extent of my technical analysis.

  181.  Amatta: WOW
    I didn’t check your numbers but it sure sounds as though you’ve taken the time and effort to figure some alternatives out without leaning completely on Phil, good for you.  Now I’ll get out of the way of Phils response.  Just my $.02   ;)

  182. pstas/coast — rain is not an issue on the coast in September, at all…and not even in early October, depending on how far north you go.  It’s hot in September…and hot over to Yosemite, through the Central Valley.  No rain.

  183. …I like fake rally’s better than real ones   …they are only one way   :)

  184.  pstas
    Mid-late September is California’s Indian Summer = no rain, no fog (theoretically).  Yes, summer-like conditions.  The coast is always a little cooler because as you know the ocean is 50 degrees off our coast.
    Yosemite is still pretty warm during the day and cooler at night but not too cold (no snow or anything).

  185. pstas..Sept. and Oct. best time of year for summer in CA.Especially for SF bayarea and Tahoe.Could not pick a better time.Wat too early for rain.

  186. Pstas – You’ll be fine. I travelled to Berkeley from Seattle in fall a few years back. We camped on the coast of southern Oregon and the redwood region, and it was fantastic. Got hot in Berkeley though up in the high 90′s and this was late Sep – early Oct.  It’ll be cooler in the mtns so bring what you’ll need esp at night. I slept outdoors at Yosemite in late May and it’s was real nippy. If you have time to push farther north, there are some glorious beaches. One we loved is Gold Bluff beach up toward Crescent City. Between the elk herd living there, seals flipping around in the waves, the giant trees and the beautiful beach itself, you’ll be glad you made the drive.

  187.  pstas
    Did a left coast bike trip a couple years ago, and went up to Yosemite – well worth it as well to do some whitewater rafting on the Merced River on the way back from Yosemite. We went from SF – great trip and much great riding. Here’s a couple worthwhile links.

  188. pstas
    September should be great up the coast.  September is still summer out here.  Yosemite may start to cool – but that will be a good thing.   If you are camping in the high country (Tuolumne Meadows) – over night temps might start to get pretty cold but day time should be nice.
    I’ve done that trip many times (living in LA) and love it.
    And as this is my first post-  
    Phil  -  thanks for the board and the immense amount of time you put into it.  Incredibly educational.

  189. tnx deano, I fly to SF,  back form LA  and  PSW  meeting in Vegas of course. Yosemite and other national park are planned to visit. Last march was to cold and snow to visit Yosemite, but Grand Canyon, Bruce Canyon and Joshua tree was very interesting too.

  190. Travel info- thanks all.
    Deano/others- any suggestions on a route from the coast to Yosemite? Thinking of doing LA north; ;then cut over to Yosemite and finishing up in SF?

  191. ICAHN reports a 9.5% stake in OSK

  192. Phil, 
    At 10:38 you posted some trade ideas based on selling puts. However, I think you made a typo on one of those, since you listed two trade ideas on DIA:

            DIA Aug $117 puts at .92
            DIA Aug $38 puts at .95
    Since DIA is currently at $123.90, I’m thinking that second entry is a typo?

  193.  pstas
    I chose the wrong route once going – too many traffic lights, but the pashnit site should help you there. good luck – and leave plenty of time for stops. What’s your bike? Safe riding!

  194. Deano- I sold my BMW (K1200 RS) so I am back to one for now – Honda Valkyrie. – just a great old road bike.  How about you? That new BMW K1600 is very tempting.  I live in the Chicago area so I would fly in and rent a bike through Eagle Rider. Have done it before in Montana and Arizona. Not inexpensive but the equipment is good. Have not had any problems in the past. I am going to contact that place in SF on one of the links you provided to see if they do one way rentals. Eagle Rider will do so for a drop fee. I see lots of good info on the Pashnit site. I try to establish a route before hand but usually wind up winging it once I get going. My biggest problem is trying to cram in too much in a  short time. I can handle 10 or `12 hrs in the saddle but my wife, not so much. Again, thanks for the help.

  195. Lotta bikers.  Option traders.  It figures.  Same risk profile.

  196. Pstas- I did that same trip a few years ago. Pacific coast highway all the way up to Carmel and then over to Yosemite would be great. We came up from San Diego through China Lakes in the back way to Yosemite and then back down PCHW.  If your coming from LA make sure to plan enough time. I think  4-5 days would be plenty depending on how much time you will be spending in the park. Have fun

  197. For all those who doubted the conspiracy theory on Strauss-Kahn when Phil put it out there (just for the record, I agreed), looks like something fishy was going on:

  198. If you are a die hard Republican, it’s getting harder and harder to defend your party:

  199.  pstas
    If you can use Wolfgang and the team at dubbleju I think you’ll be very pleased. I have no bike right now, but keep renting the BMW R1200RT’s when my college buddies and I do our tours. The new 1600 looks intriguing but I’ll give it a few years for them to perfect it.
    Have a great trip!

  200.  End of the world as we know it II —  quite good.
    Wednesday June 29, 2011
    Broke Bank Mounting – America’s Dystopian Future

  201. Phil – think we could follow through tomorrow to the upside? It’s also the first day of the month(remember that trade?) could set us up strong into the holiday, then no news over the break and we off to the moon Monday…….

  202. SQQQ/Amatta – What if there is no sell-off?  Yes you can take the Aug spread as a NEW play but you haven’t burned the premium off the old spread yet.  The July $31 calls are still .15 and $7 out of the money – why would you pay that premium?  It’s 20% of your original spread and 300% of your net (as a loss if you pay it).  Your question was about the July spread so I don’t get the "why wouldn’t I roll to Aug…" part – that’s a totally different trade, the July trade died and is in salvage mode.  None of that matters if your longs did well to cover the loss so the real question is, was this good coverage?  If so, you need to consider that you are now the proud owner, essentially of X amount of SQQQ at net $25.35 so spending the next .40 (and that’s all the net of the last 2 sales is) on the Aug/27/30 spread (which is still pretty far out of the money) raises your net on the puts to $25.75 so just keep an eye on how much risk you are piling up there.  

    As to why I’m somehow "nicer" to Drum – what I told him was essentially no different than what I told you except I pointed out that you do this ALL THE TIME, whereas Drum does not constantly repeat the same mistake.  Had I told Drum over 100 times to stop the losses at 50% on a vertical or had I told Drum over 100 times not to buy back premium if it can be avoided, then maybe I would say to him "you always wait until it’s too late" but he still has about 97 times to go before I even get to the point where I start thinking he’s unable to see the pattern of his own poor trading habits like some people – who shall remain nameless.  

    TZA is the same thing, you say "roll" but what are you rolling?   The $38 calls are .72 and the $42 calls are .35 so, AGAIN, why would you pay a $8 (23%) out of the money caller .35, which is .35 added to your net cost?  You can pick up an August spread but it’s essentially a new trade – it’s not a reason to throw $700 out the window buying back 20 July $42 calls for .35.  If you can’t afford to leave them naked and get your .72 back ($1,480 on 20) from the July $38s, that’s one thing but the CORRECT play is to roll the calls you own BEFORE the premium is burned and LET the premium on the caller expire (but, if it goes the wrong way on you, don’t let a cover roll get away, of course).  These ultras are exactly the kind of trades you should not be doing based on the fast moves, quick adjustments that are required and you long, long history of not doing well with them but I have told you that well over 100 times at this point and you seem to know better than me so why do you even bother asking my opinion?

    Up or down sounds right to me Rpme. 

    You’re welcome Lightingguy! 

    DIA/Elliott – I can’t think of what I was looking at for $38 so that’s just a dead spot at this point.  I was running over about 100 different companies to see which ones probably had good support and reasonable put premiums to sell.  

    Strauss-Kahn/Rustle – Thanks for pointing that out.  I just got tired of defending him but, as I said at the time, the timing, circumstances and story made no sense.  USUALLY if just one thing in a case makes no sense, you tend to give the accused the benefit of the doubt but this guy’s life was destroyed in record time and isn’t it interesting that the day after LaGuarde takes his job, NOW he might be exonerated.  

    Prosecutors from the office of District Attorney Cyrus R. Vance Jr., who initially were emphatic about the strength of the case and the account of the victim, plan to tell the court on Friday that they “have problems with the case” based on what their investigators have discovered, and will disclose more details of their findings to the defense.

    “It is a mess, a mess on both sides,” the official said.

    According to the two law enforcement officials, the woman had a phone conversation with an incarcerated man within a day of her encounter with Mr. Strauss Kahn in which she discussed the possible benefits of pursuing the charges against him. The conversation was recorded.

    That man, the investigators learned, had been arrested on charges of possessing 400 pounds of marijuana. He was among a number of individuals who made multiple cash deposits, totaling around $100,000, into the woman’s bank account over the last two years. The deposits were made in Arizona, Pennsylvania, Georgia and New York.

    I’m sorry to those of you who like to believe the World is some sort of fair place where powerful people don’t set people up and destroy their lives for profit but it kind of happens all the time.  I used to live in that World and walked away because I couldn’t stand so many of the people I had to deal with and also because, more and more, those are the kind of people who are taking over.  They win the elections, they pack the courts, they destroy their competition any way they can – it’s very sad and I usually keep my mouth shut because, when I do say something, as I did with Strauss-Khan – I get "tainted" for trying to stand up for someone.  It’s a sick game "they" play and you should just be very, very glad if it’s not a World you have contact with but it is important to know that it’s out there and not every "conspiracy theory" is baseless…  

    Jet Tax/Rustle – Senator Crapo – I love that name!  How do we get him elected Speaker?  The key to that issue is:  

    But not only are Rubio, Crapo and the rest defending a tax loophole for the most fortunate Americans, they’re completely misunderstanding it. As hard as it to believe, the private jet tax break is no “metaphor” or “code” for people making too much money — it is an actual loophole in the tax code that applies to private jets and not commercial ones. The provision, created in 1987, allows corporate jets to be depreciated over a five-year period rather than the seven-year period required for commercial ones. It has been defended and supported by Republicans since.

    The more sophisticated conservative defense of special tax breaks private corporate jets, advanced by the Hertiage Foundation, among others, is that it was created by the stimulus package. As ThinkProgress’ Matt Yglesias explained, this myth too is bunk.

    While closing the loophole wouldn’t raise enough money to solve the deficit problem by any means, it points to the absurdity of much of the spending in the tax code and would surely be a step in the right direction. The conservative response to ending it, meanwhile, speaks to the priorities of their tax cut “theology” — fewer taxes for the wealthy above all else.

    Upside/Hoss – I think the Dollar is going to have a very hard time failing 74.50 because the Euro would have to be over $1.455 and the Pound would need $1.61 and the Yen would have to drop below 80.25 and NONE of those dynamics have been apparent in recent trading.  So, absent of a major, positive announcement from the EU or some sort of Yen-positive news or Dollar-negative news, I don’t see us going higher.  Of course we’re the only ones with a 3-day weekend so anything can happen while we’re at the BBQ on Monday…

    Speaking of which – Now that Asia is closed (Nikkei up 0.5%, Hang Seng up 1.5%, Shanghai flat), It’s a good spot to short the RUT (/TF) futures below the 825 line on the assumption Europe pulls back.  825 is a strong upside resistance so should be easy enough to stop out over the line and, if we do get a break-down, it could be a nice ride. Oil (/CL) is also a good short at $94.50.  

    Broke Bank/ZZ – Here’s the direct link.  Also, did you guys hear Colbert got his Super-Pac approved.  It’s amazing, he formed a Super-Pac to illustrate what a joke the whole process is and, despite the fact that he’s waving all the BS in everyone’s face, they still approve him because – ANYONE can just do this if they want to, no matter how ridiculous it is.  

  203. Phil
    Couldn’t agree more with your quote below.  Stuck in the corporate meat grinder with exposure to high-level execs and can attest 99% are evil, crooked and abusive (some are even sexual predators).  They’re enjoying these times as the lack of jobs makes it even easier to rape and abuse people without fear of turnover.  Been looking for a way out myself, but haven’t been able to find one.  I agree with your opinion that a job and steady income are the best sources of investment income, but it is painful these days and takes far too much time away from your portfolio.
    "I’m sorry to those of you who like to believe the World is some sort of fair place where powerful people don’t set people up and destroy their lives for profit but it kind of happens all the time.  I used to live in that World and walked away because I couldn’t stand so many of the people I had to deal with and also because, more and more, those are the kind of people who are taking over.  They win the elections, they pack the courts, they destroy their competition any way they can – it’s very sad and I usually keep my mouth shut because, when I do say something, as I did with Strauss-Khan – I get "tainted" for trying to stand up for someone.  It’s a sick game "they" play and you should just be very, very glad if it’s not a World you have contact with but it is important to know that it’s out there and not every "conspiracy theory" is baseless…"

  204. What’s the opinion of how many USO contracts is too much to trade in bulk before the red flags alert the storm troopers?  I was pondering that question when I bought the 36 puts for .37 yesterday.  I only ended up getting 50 because it was a gamble based on some things I saw, but there are times when I’m much more sure and buy 100-200 contracts.  This is usually my first leg in, I do mine in 1/3′s.  So I could possibly have 150 contracts at the end and will need to dump them all at some point.  Of course I rarely get the full position in USO since it usually turns into a short trade if I’m correct in my trading (it’s been a great few weeks for that :) ). 
    I used to have a formula based on avg. open interest and trades/day but I don’t remember where I stored it.  Christ I’m getting old.