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Still Thinking On Thursday – Can’t Get Bullish

I am trying!

I watched Fox news for hours last night and I did learn that Warren Buffett is an evil, criminal mastermind who must be stopped and that Obama is soft on the Taliban so following through on his pledge to end the war is nothing more than an insidious plot to garner votes by…. uh…. doing what he was elected to do – THE FIEND!!! 

Damn, see – it's not working.  I'm hardly any dumber (but I am much less tolerant of poor people and minorities) and I still can't get behind this market rally.  Oh wait, before we get off the Fox topic, I want to point out another "big" news story they featured.  It seems that we're finally cracking down on welfare recipients who spend their money at strip clubs.  The House passed a bill yesterday as bill sponsor Charlie Boustany (R-LA) pointed out that, with all these welfare people spending the Government's money at the strip clubs, he had to wait over a half hour to get a VIP table so he could spend the Government's money at the strip club.  Outraged Congressmen passed the bill 395 to 26 (women) as this was an issue that really hit home for them!  

DejavucreditequityIf we finally hold our chart levels, my mission this weekend is to kill as many brain cells as possible so I can stop understanding the news and just buy the f'ing dips, which will be our game plan until the levels are blown again and it's safe to switch our brains back on.  On the right, we have a Rorschach Test for the day to see if you can be oblivious enough to go bullish at the top of our range.  

If this chart doesn't bother you – you may be ready to rally!  You are also ready to brush off the OWS movement as "squatters" – something else I learned on Fox last night.  That's right, they are not protesting – thousands of people are actually gathering in parks to get "free rent" as they can't possibly have a legitimate complaint against the rampant abuses of Capitalism that are tearing this country apart.  

Well maybe not this country but Japan is sure about to break as Finance Minister Azumi calls out the Fed's "pledge" to keep rates microscopic through 2014 as giving an invitation to traders to sell greenbacks.

 “Speculative moves are increasing in the market and we can’t overlook them,” Azumi told reporters in Tokyo today as the yen heads for its biggest six-day jump since mid-August against the dollar. Against the “backdrop” of the Fed’s plan to keep interest rates exceptionally low until 2014, “short- term speculative buying” has increased, contributing to the yen’s gain, he said in parliament today

Azumi’s comments may indicate Japan is closer to resuming foreign-exchange intervention after a record round of yen sales late last year. The admonition comes a day after Sharp Corp, Japan’s largest maker of LCD panels, forecast its worst annual loss since its founding a century ago, with its president saying exporting is “nearly impossible” with the strong yen.

Yen-selling is still in the cards, but it’s becoming harder for Japan to do it because of external pressure,” said Hiroaki Muto, a senior economist at Sumitomo Mitsui Asset Management Co. in Tokyo. At the same time, “speculative trading could get out of control” and accelerate yen gains if investors think Japan won’t intervene," he said.


So our remaining bearish premise is that the BOJ will finally put their foot down at 76 Yen to the Dollar and that should put a floor under the Dollar at 78.85 and a top on the Euro at $1.32 (TRADDR chart above).  If we're going to pop the top of our range, we can expect those levels to break first.  Once we get over 12.750 on the Dow (assuming the other indexes hold up) – we're officially in orbit and no longer bound by the gravity of fundamental reality.  This is a perfect set-up for a technical rally that can take us up and up and up as sideline money (including ours) rushes to get back into the markets

What can we do to profit from a move higher?  Well, that's pretty easy.  Here's a few examples of bullish plays you can take that will do very well IF this rally continues:  

  • FAS Feb $77/80 bull call spread at $2, selling $75 puts for $1.50 is net .50 on the $3 spread.  Note that you can simply take the bull call spread which makes 50% in 15 days if FAS simply holds $80 (now $83), which is roughly XLF $14.  
  • FAS March $75/80 bull call spread at $3.05, selling $70 puts for $3 is .05 on the $5 spread.  That's about 18% down in FAS before this trade costs you more than a nickel.  That's a 6% drop in XLF to about $13.  If you don't think XLF can hold $13 for 6 weeks – you're not bullish!  Also, don't forget these are trades we pull if our levels don't hold.  

Alternate offsets (bullish) to selling aggressive short FAS puts are:

  • CHK Jan $17.50 puts can be sold for $2.05
  • GE 2014 $17.50 puts can be sold for $2.50
  • GOOG June $450 puts can be sold for $4
  • ISRG Jan $310 puts can be sold for $10
  • KO Jan $62.50 puts can be sold for $3
  • MO 2014 $23 puts can be sold for $2.15
  • PFE 2014 $20 puts can be sold for $2.65
  • XOM Jan $65 puts can be sold for $2.50 

A good short put is a stock you REALLY want to own if the market drops 20%.  These are all solid companies that won't be immune from a major market sell-off but should do fine in a long-term portfolio beginning with these initial entries.  Also keep in mind these things do not have to be all or nothing – The second FAS trade, for example, makes 66% on the bull call spread.  If you sell one $4 GOOG put for each four of the FAS calls, assuming the GOOG puts expire worthless, you lower the basis on the $5 FAS spread to $2 and, rather than netting 66% cash, you net 150% on cash – that's how easy it is to goose your cash returns.  

Outside of the Financials, we can look at a few other plays that can do well in a bullish economy:  

  • CHK ($20.97) is a play on natural gas coming back.  The 2014 $15/20 bull call spread is $2.65 with almost 100% upside if they hold $20 for 2 years.  Again, it is GREED when you think making 100% in two years is not enough but you can knock that net $2.65 down to .30 by selling the 2014 $15 puts for $2.35.  So if, for example, I am willing to own $15,000 worth of CHK, I sell 10 of the puts and buy 10 of the spreads and if CHK holds $20, I'm up $4,700 and between $20 and $15, I'm down $300 and below $15, I end up owning 1,000 shares of CHK at net $15,300 ($15.30 a share).  That's 27% below the current price and TOS says you only need $1,600 of ordinary net margin on the put side.  
  • AA ($10.20) is down from $17 last spring and it's hard to have a Global recovery without tin.  If you're willing to own them for $9.30, you can sell the 2014 $10 puts for $2.10 and buy the July $8/10 bull call spread for $1.40 for a free crack at a $2 spread that's 100% in the money and your worst case is getting a 10% discount on an entry. 
  • AMZN ($179.30) has good puts to sell because of yesterday's sell-off.  You can sell the 2013 $110 puts for $4.15 and if you don't want to own AMZN for $110 – you are more bearish than I am!  AMZN is a pretty reliable rallyer in the Fall and the Jan $170/180 bull call spread is just $5.20 so net $1.20 on the $10 spread that's $9 in the money to start.  

Well, out of time for now but, as I keep saying, it's very easy to get bullish and set up for very nice profits – SO WHAT'S THE HURRY?  Let's just make sure these levels are real and, once we feel good about them holding, we can find trades like this every day because – if the Government is going to insist on making everyone rich by jacking up the markets – who are we to object?  

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  1. 8:03 AM MasterCard (MA): Q4 EPS of $4.03 beats by $0.10. Revenue of $1.7B (+20.20% Y/Y) misses by $30M. Shares -0.5% premarket.
    Probably won't help the 330 puts in the 25KP from yesterday.

  2. Some Shocking Honestly Out Of Juncker Sends EURUSD Below 1.31
    Eurogroup muppet and Luxembourg Prime Minister Jean Claude Juncker, whose comments to in an interview with Deutchslandfunk were shockingly open and realistic. Among these were that the measures from the January 30 summit were "largely insufficient" and that Greek PSI talks were "ultra difficult."
    so the Greek hard deadline of March 20 is now less than 50 days away, with the full exchange offer needing at least two months to be concluded, and there is still absolutely nothing on the table.

  3. Oil Lines

    R3 – 101.35
    R2 – 100.42
    R1 – 98.93
    PP – 98
    S1 – 96.51
    S2 – 95.58
    S3 – 94.09

    Yesterday's high and low – 99.49 / 97.07

    Breakout lines – 100.40 / 90.73

    S1 has held so far this morning!

  4. The pot calling the kettle black: The U.S. Treasury Department criticized Japan in a December report for unilaterally selling its currency in August and October, saying the Asian nation should focus on steps to “increase the dynamism of the domestic economy.”

  5. Wow, MA went from down 4 after earnings to up 10 now.

  6. @Felipe
    "…… welfare (Ibanksters, etc.) people spending the  Government's money ….."
    I think this perhaps where the redistributionists veers off into la-la land.  The government doesn't have any money. The money that is spent in strip clubs comes from, usually, the taxpayer, or the printing press in theBernank's basement.

  7. FAS Strangle / Kongen – Sorry I didn't answer your question last night. I agree that by selling a FAS ATM straddle you could technically collect a lot more premium each week as one of the side will certainly be a loser and you can roll the other sides. The problem for me would be that sometimes you can get buried and the roll will be tough. For example, on Monday, we could have sold a 78 straddle – the put side has gone from 2.85 to 0.25 so a great win there. But in the meantime, the call side has gone from 1.80 to now 5.66 so not so good. And as of now you can only roll it even to the Feb 80 which is far from out of danger right now (the 81 calls we sold can be rolled to the Feb 85 which at least is OTM for now). Unless you are willing to go 2x or 3x but quite costly with FAS. You could of course plan for the 2x or 3x rolls by starting a smaller position, but then you collect less premium on the wins so I guess it evens out. 

    Now, if you want to make directional bets using some TA, selling ATM puts or calls, it would make a lot more sense as the greeks work in your favor. But that's another trade altogether. That is something else I would like to try as well, but the problem is that it involves a lot more timely trading (like JRW's system) and it is harder for others to follow as a couple of minutes can make a big difference.

  8. Phil/Buffet

    I tried to tell you…:-)
    You need to start watching Fox 24/7 (there totally fair and balanced) and apologize for the chastising you directed at me for having the nerve to ask if Buffet had a hidden agenda.

  9. I think that we had a chart for that yesterday, but here is even more details on similarities between 2011 and 2012!

    And how that turned out!

  10. And markets are running hot around the world… All the international ETFs are overbought now:

    Of course, we can remain overbought for a while but it makes the correction even harder!

  11. Chart / StJ – Can it be so simple? We just follow the chart? 

  12. EXEC//once you have 50 billion you can afford to be a populist…I don't care for Romney at all but he gives more money to his church in % terms than anyone I know…it would be interesting to see how much money Buffett gives away that isn't related to a tax scheme…lot's of big talkers not many large givers..

  13. I don't understand what people see in mornings.  Damnably bright, inane birds cheeping, lawnmowers, lots of unwarranted optimism about a "new day" — reminds me of dogs — brainless, happy, tongues wagging.  Night is like deep space.

  14. Chart / dpas – I have the strange feeling that the future will be different… but somewhat similar as well!

  15. But Angel, Romney doesn't care about poor people!

  16. Cramer says CMG is a buy…
    FU Cramer!!!

  17. Phil- Having trouble getting my credit card to go through for my membership renewal- is there someone I can contact and way to do so? Thanks

  18. Angel/Rich

    I'm not a big fan of Romney either.  Come to think of it…..I'm not crazy about any of them. 

  19. there goes the dollar to goose the markets at the open.

  20. Wow, folks are chattie this early a.m.!  PP:

  21. Speaking of the dollar, the PP this morning is 79.13 and since we are there now, we go up or down from here!

  22. Good morning,


    IWM    77.96,  78.34,  78.76,  79.10,  79.53,  79.81,  80.47  and 80.99


    I also have an ascending trend line now at 80.12;   good hunting !!

  23. Didn't Buffet team up with Gates Foundation with his money??  I think that trumps Romeny.  Not that I am keeping tabs!


    OK, MELI is breaking out….on what news?  GOOG?  According to David's Chart (All about the Trends), it is time to short, but according to Opts methods, it is time to go long…What to do, what to do?

  24. Yahoo!  Yesterday, just before close, I followed David Ristau's rec on GMCR: buying both put spread 52.5/50 and call spread 57.5/60 expiring tomorrow, betting that GMCR would go either way > 10%.
    I was so confident that I entered ONE contract!  Barely enough to buy some of their coffee! :)

  25. ARRY is at the top of the channel from their previous high.  Time to sell 1/2 to get out even…whew!

  26. Phil – great post! Only wish you had reserved it for member chat. I really like the very clear trade ideas – I know you post them all the time but something about how concise they were helped my otherwise slow brain. Thanks!

  27. Low volume open. Thanks for the lines JRW 80.12 should read 81.12

  28. every day CMG hits a new all-time high.

  29. OK, want to a starter position in INFI.  Selling a few April $5Ps for 50c or better.  I just tested them and they move for 40c in a jiffy, so need to move the bar up a bit.

  30. BSX is hitting all time lows.  Any thoughts ?

  31. This should be our positions right now. I booked the trades that could be had at the end of day yesterday like the MA trade. But for example, the BKS put could not be bought back for $0.10. I also sold the DIA puts as they were even as instructed by Phil. The rest should be accurate. I think that I am missing one trade in the closed ones, but I'll fix that today. Let me know if you see discrepancies!

  32. Chipotle Mexican Grill Inc: * UBS raises Chipotle Mexican Grill Inc price target to $365 from $345

  33. USO bouncing off PP as well as 200d MA.  Going long here.  Feb 38 Cs.

  34. FAS Strangle – Can't fight the tape… Selling the 81 puts now to create a straddle. Something has to give now!

  35. Good morning! 

    5 – count 'em – 5 bullish trade ideas in the morning post.  Scaling in means you can buy one today and one tomorrow and one on Monday and one on Tuesday because, if we are over our lines for the next 5 days – I'm going to have to say we're actually bullish.  

    I'm not there yet but I see that some people are way too bearish and – rather than capitulate at the top – how about just picking a high-return bullish trade and hanging tough over the weekend as a strategy?  Watching yet another morning of relentless market pushing – I feel kind of the way I felt during the OJ trial – I can't believe it but I'm going to have to accept it (OJ was my boyhood hero)….  

    As with the OJ trial – it doesn't matter what the "so called facts" are – what matters is what you can convince a dozen people (or a million investors) to latch onto as their driving belief.  If we can convince people that the EU crisis boils down to whether or not Greece gets a loan – then that becomes the rallying point.  It doesn't matter what kind of crap condition THE ENTIRE REST OF THE WORLD is in because, didn't you hear? – they "fixed" Greece.  

    This is a classic MSM propaganda technique as first, Greece is scapegoated (#5 on the list) and then the issues are confused (#8) to make the very simple concept of Europe's Trillions of Sov debts seem to pale in comparison to Greece's $500Bn and that is accomplished with saturation on the Greek issue (#11) to divert your attention away from the actual crisis (#14).  So now, when Greece is "fixed" – investors will feel like there's nothing to worry about – until the Media tells them what the next thing they should worry about is.  

    Our problem is we read too much and think too much and once you realize there is no Santa Clause (spoiler alert!), then you begin to question the Easter Bunny as well.  We're not likely to be able to recapture that childlike sense of innocence again but PT Barnum was able to make a very nice career out of betting on what the common man would be doing and it's up to us to step back and let go of our feelings (when and if our technicals break) and simply join in with the manipulators and take the suckers for all they're worth because – someone is going to do it anyway, so we may as well get our share.  

    For now, though, I'm still not getting my Dow 12,749 but NYSE is holding up at the moment (7,926) and I care more about them than I do the Dow, which was running ahead of the pack anyway.  

    MA went $20 the wrong way on us this morning.   $20 down and we'd be having a party but we knew that was super-risky.  I still like shorts better than longs but let's see how Bernanke's Congressional Testimony goes today. 

    At the open: Dow +0.11% to 12731. S&P +0.19% to 1327. Nasdaq +0.23% to 2494.

    Treasurys: 30-year -0.17%. 10-yr -0.03%. 5-yr -0.02%.

    Commodities: Crude -0.78% to $96.84. Gold +0.03% to $1749.95.

    Currencies: Euro -0.17% vs. dollar. Yen -0.12%. Pound +0.06%.

    10:00 AM On the hour: Dow +0.04%. 10-yr -0.07%. Euro -0.11% vs. dollar. Crude -0.91% to $96.72. Gold +0.21% to $1753.25.

    Market preview: Stock futures erase losses to turn positive after data showed new claims for unemployment benefits fell last week. S&P +0.1%. European bourses mostly higher as Greece's debt talks drag on. Retailers ANF and ANN down sharply after lowering guidance. Commodities markets struggle amid a modestly stronger dollar. Still ahead: Bernanke testifies. 

    Jan. Challenger Job-Cut Report: 53,486, up from 41,785 prior and marking the largest monthly total since September. +39% Y/Y.

    January ISM New York Manufacturing: 54.1 up from 53.1 in December. New orders 57.6 vs. 54.8 prior. "Manufacturing is starting out the year on a positive note, with new orders, production and employment all growing in January," the report says.

     Q4 Productivity and Costs: +0.7% vs. +0.8% expected and +2.3% prior. Unit labor costs +1.2% vs. +1.0% expected and -2.5% prior. 

    Initial Jobless Claims: -12K to 367K vs. -7K consensus. Continuing claims -130K to 3.44M

    Just weeks after advising caution, bank strategists are capitulating on their bearish forecasts after the best January for global stocks since 1994. Analysts cited surprising emerging-market outperformance, confidence the euro will survive, and China easing as key growth levers.

    Same old song and dance?: Premier Wen Jibaeo says that China is considering a larger involvement in the EFSF and the upcoming European Stability Mechanism in what he labels an "urgent" mission to solve the European debt crisis. Merkel is in Beijing to confer face to face with Jibaeo on the issue. 

    The ECB continues to take advantage of the Fed's eased terms on dollar swaps, its borrowings rising to $89.3B, the highest level since the crisis began and suggestive of the stresses remaining in the EU banking system. ECB statement here. Chart of borrowings showing the major ramp up since December here

    The IMF criticizes the "absence of progress" from Argentina's government in improving its statistics, calling for "accurate data" within 180 days. The Kirchner government says 2011 inflation was 9.5%, while opposition lawmakers say it was 23%. Economists face massive fines if they question government data. Bad for stocks? Not in 2012. ARGT +12.5% YTD. 

    The Spanish economy continues to shed jobs at a speedy rate, the number unemployed rising 4% to 4.59M in January. The unemployment rate, calculated off of a separate survey, stood at 22.8% at year's end, meaning it is now likely above 23%.

    Spain's borrowing costs fell substantially at a €4.56B euro auction of mid-term debt today, as investors apparently backed the ECB's liquidity plan and EU's fresh commitment to budget discipline. Yields on 3-year bonds fell to 2.86% from 3.38% just three weeks ago. A French €8B auction this morning also saw solid demand

    The Irish Central Bank slashes its 2012 GDP growthforecast to 0.5% from 1.8%, warning the slowing growth could make it difficult for the government to meet its budget targets. The bank also cut its 2011 forecast to 0.8% from 1% (nice of them now that we're 1 month into 2012).

    It's Groudhog Day in Brussels too, where the EC's Olli Rehn says he expects a Greek restructuring deal by the end of the week.

    While there are plenty of risks, 2012 is "nothing like the 2008," Goldman Sachs' Jim O’Neill tells CNBC. "The key to this market movement over January is that people were worried about everything that could go wrong… So just the cessation of bad news itself has sort of appeared a bit of a positive." Germany is improving, China seems headed for a soft landing, and the U.S. is "moving forward," he says.

    Deutsche Bank (DB) swung to a Q4 pretax loss of €351M,missing consensus of €572M, on Greek debt writedowns and i-bank losses. Tier 1 ratio improved to 9.5% from 8.7% a year ago. Shares-1.2% premarket. (WSJ

    The Chinese spent $7.2B overseas on luxury items in the period around that country's New Year, up 28.6% from last year, according to the World Luxury Association. China is now the gorilla in the European luxury market, making up 62% of sales; in North America 33%.

  36. Things are getting back in Iran and they are getting rough on the currency speculator:

    In addition, the chief of Iran’s judiciary, Ayatollah Sadegh Amoli Larijani, threatened Wednesday to seek the death penalty for major speculators. Speaking about the unrest in the foreign-exchange markets, he warned that “depending on the importance of their crimes, some of the economic corrupted can face execution,” the semiofficial Mehr News Agency quoted him as saying in a meeting with judicial officials on the currency crisis.

    Let that be an example….

  37. Phil, Lflan – what do you guys think of OPEN (Open Table). Played the puts last earnings and did well.  What's your take on this time around? 

  38. Pharm / MELI — long if it breaks out above the all time high. short if it fails and then fails $92. That'd be my take. I was watching that long ago and it slipped off my radar.

  39. jabo – I feel your pain. I got on the wrong side of another momo stock short call (CRM) and learned a hard lesson. Promise us you're not going to run screaming into a Chipotle restaurant some day and trash the place.

  40. Phil
    Great post! Your keen and often accurate observations with the corresponding game plans are greatly appreciated!

  41. Government/Flips – Yes, when you write a check to the IRS, that isn't money.  When the Government sells $140Bn worth of TBills, they don't get money.  In fact, there is no Government at all – it's a work of pure fiction that only the Democrats still believe in…

    Buffett/Exec – Yes, it's all so clear now.  Thank goodness for blessed Fox and the clarity they bring to these issues.  

    Similarities/StJ – Yeah but we don't want to wait another couple of weeks to see a turn!   Those World markets are on quite a tear. 

    Buffett/Angel – Wow, I love these completely off the cuff attacks that are backed by no facts whatsoever.  Buffett has already pledge most of his estate to the Gates Foundation (another blatant tax dodge, I'm sure) and ALL of the rest goes to various charities but he still managed to scratch out about $100M last year to various charities in addition to the various trusts he himself has set up over the years.  What a snake!  Conservatives are lucky that people like Buffett and Gates are genuine givers and don't form some kind of liberal SuperPac to change the message in America instead.   How do you even have the balls to disparage someone like that?  Every dollar he earns for his Berkshire shares is earmarked to charities so he essentially just works for them and that relatively tiny paycheck he lives on each year is just that – the tiny paycheck he lives on.  

    Wow ZZ – get up on the wrong side of bed today?  

    CC/Jthom – Sure, contact admin at philstockworld dot com – that's Greg, he'll help you.

    AA Money/StJ – Nothing

    FAS Money/StJ – I think we're done with the short puts at .90 now.  

    IWM Money/StJ – Ouch but we'll wait. 

  42. Thx. Rain.  I am already short from hitting a target I was looking at….

  43. JRW: What is your target for IWM?

  44. Oil  / Phil,  Your running commentary on your oil trades last nght was excellent. Best of all you didn't get any big win or loss. Much more instructive that way.   Looks like at first glance you turned several moves that turned against you into small wins and smaller losses.  Can't wait to go back and match your comments to the charts, minute by minute.  And thanks to Lncoln Bertll and pacdog for their comments too.

  45. Phil,
    WIth all this anticipation about Greece, It looks like the market is setting up for a "sell the news" type event when the deal actually comes, regardless of how good or bad that deal is. Your thoughts on that please.

  46. Phil, 
    Re: OJ
    Professors at Stevens Insitute of Technology created software that supposedly is better at detecting lies than polygraph.
    O.J. Simpson, in his memoir I Want to Tell You about the murder of his wife
    I am 100 percent not guilty. … When asked at my arraignment, where the charges against me were first formally stated in court, I said, ‘I am 100 percent not guilty.’ I said it again in Judge Ito’s chambers, and I say it again here.
    The Software Says: Truth

    Read the full text here: 
    --brought to you by mental_floss! 

  47. Pak--I promise you that I will NEVER eat at Chiptole!!!
    But beware of flying rocks ;-)

  48. Garcia,

    It's looking like the market is waiting for a "wall of good news" to sell off on.

  49. So, I am listening to my iPod, reading, and this song comes on….

    This is the land where nothing changes
    The land of red buses
    And blue blooded babies
    This is the place where pensioners are raped
    And the hearts are being cut from the welfare state
    Let the poor drink the milk
    While the rich eat the honey
    Let the bums count their blessings
    While they count the money

  50. From Pretzel Logic (Blog roll)….Bullish Percent Index (BPI) is a breadth indicator based on the number of stocks on Point & Figure buy signals within an index; readings over 70% are considered overbought, while readings under 30% are considered oversold.  The current reading is 96.67%, a virtual tie with the highest readings ever recorded.

  51. OJ — The software also indicates it was the one-armed stranger.

  52. Buffett/Gates… All true.  But why not pay taxes too?  These foundations shelter billions from taxes that then need to be collected from other people.  Do you really think they wouldn't give if they had to do it with after tax money?

  53. jabob – don;t  tweet that.

  54. BB just open the money hose again the DX just dropped like a rock!

  55. Phil FAS money are you buying .90 worth of premium?

  56. Stj, the BKS spread filled at .10
    Also, sold FAS 83 calls at 7.9 this morning.

  57. FAS Money – Buying back the Feb 72 puts (now 0.89)

  58. Phil
    On the FAS 77/80 FEB BCS, the $70 puts @ $1.5 you mention are currently .58. Was the $1.50 correct?

  59. Thanks mam… I have already booked the FAS 83 calls last night. I'll book the BKS today then!

  60. @Felipe
    When I write my annual check ( I keep the Estimate payments I otherwise would send in to, say, short oil contracts) the 'government' is not giving me a choice to "Buy" or "Not Buy".  They are forcing me to do so.  I am not engaging in a voluntary transaction. Far different than the check I send in when I buy the new IPad or Hustler.  I have relinquished it, and acknowledge that I no longer own that money.
    However, when my money is sent to the government it is no different than an extortionist, blackmailer, or  bank robber forcing me to give my money to him, or possibly forefeit my life and/or freedom,  in which case it is STILL my money.  And any recovery of it would hold that to be self-evident.
    Ditto with the government forcing a payment of taxes (not that I don't think a certain percentage of which is 'payment for services rendered') Lots of taxes that I have no say in paying. I risk loss of freedom should I decide to not pay. 
    But I do understand the mentality of the left thinking that All money belongs to the government and what they let me keep I should be delighted with.
    This is the sine qua non, the sum and substance of the left versus those of us who actually earn money, believe it to be our own. And the fact that we involuntarily hand it over or lose our freedom does not mean it belongs to the government.

  61. hilarious morx

  62. EXEL…..go go go

  63. VRTX…..IMGN…..SGEN…..INFI…..ARRY…..CRIS…..YMI …..OMG….(that last one does not exist! ;) )

  64. @Felipe
    Hell indeed you need a change of country my I sugest Belize?

  65. StJeanLuc – FAS  
    Are you still holding the 81 calls short?  It's making me sick to my stomach.  Over a 500% loss now, with only 0.12 of timeprem.  
    Are you really thinking of holding until tomorrow with this relentless upwards push?

  66. Burrben
    FAS strangle did you take the credit of the puts in to account Possible we will sit on it until tomorrow

  67. Phil, I'm glad you watch Fox for me, because I simply cannot. Bush coddled OBL, Obama killed him, and Fox soldiers on with the mass-appeal "weak on terror" nonsense to promote their agenda. It's so filthy and disgusting, it's like free bad porn on cable (maybe that's the appeal…)

  68. FAS / Burrben – At this point there is not much else to do but wait. The rolls will be very similar tomorrow now matter what as the premium in the weeklies decay faster than the longer dated ones. And we can only hope for a move down tomorrow! It is sickening, but we knew there would be a week like this one eventually, we have been lucky so far! It's the downside of these 3x ETF – quick violent moves!

    As far as rolling now, it looks like we'll skip next week's options on the calls and sell Feb options. In the meantime, I hope you sold the puts this morning to help a little bit!

  69. Phil, tough crowd today…..

  70. Hey BDC, did you get the info you're looking for on Vegas?
    I know Vegas very well (24 years) if you need more insight….

  71. The The/Pharm – excellent. thanks for that vid!

  72. Anybody thinking of shorting Zygna since they're up a bit on the "FB effect"?

  73. phil that rant was more gaseous than substantive…my point was romeny gives ten percent of his take to a non profit every year..i cant stand him at BURPPPP to you too

  74. any thoughts on the facebook IPO?

  75. Facebook / Angel – How much of the company are they really floating now? It's the same problem with many of these guys, they float 10% so shareholders have basically no control of the company no matter what…

  76. Phil – My thanks too for the excellent commentary overnight.

  77. Speaking of Facebook….

  78. Phil,
    Were you going to consider a play on GMCR since it has pooped on earnings?

  79. Pooped :-)

  80. I did mean 'popped' :-)

  81. Whoa!
    Must be a problem with my quotes! The market is down!

  82. NSPH…..PLX….

    The things that I've loved the things that I've lost
    The things I've held sacred that I've dropped
    I won't lie no more you can bet
    I don't want to learn what I'll need to forget…..

    - Audoslave

    That's for you Phil!!  Turn the brain off!


    Although I am still short, and paying for it…One day.

  83. Will EDZ ever be green ;-(
    FU EDZ!!!
    DIE CMG!!!
    tweet tweet ;-)

  84. PCX
    Want to see a very manipulated stock….Patriot Coal reported a disappointing earnings report but the stock is up 11%…. It is one of the most active stocks traded…

  85. Facebook / angel – Their numbers are rather nice.
    $3.7b rev
    $1.0b net
    27% profit margin
    87% 2011 rev growth on top of 154% in 2010
    it will instantly join the mega cap club, possible at $100b mkt cap
    So, yeah, it's a big deal.

  86. Pharm
    I here ya!

  87. st jean i am checking…sco block buys looking toppy could it actually happen we are down today..and break the sacred trust of the MSB  or he who will allow no close at the lows!

  88. OMG / Pharm – It does exist!! and is rallying as well today! +2% :-) (although probably not pharma company)

  89. ROTFLMAO depast…..Let's invest in them and send out a twitter…..!


  91. EDZ / Jabo – Many of the countries are overbought now so maybe there is hope for a correction soon… But I sympathize on the 3x ETF side!

  92. GMCR/Cwan – Come on, you can buy a whole machine now and add to the top line! 

    Thanks Samz – Don't worry, when trades are below the fold in the main post (not visible on main page) only Members can see them for 48 hours, after which they are available to the public.  Only if I specifically make the post available to the general public can it be viewed in full the same day and, as I said, that's just our first 5.  

    BSX/Peedle – Dead stock these days.  I like them but I won't play them because they are just relentlessly bad.  

    $25KP – Well, we're nicely balanced at a $6K loss but nothing thrilling about that.  Our bullish plays are DMND, BKS and SLM only as we flipped a bit more bearish yesterday but I am sincerely hoping to be able to make it into the weekend still bearish.  Volume this morning is just 29M at 10:45 on the Dow and yesterday was anemic but MAYBE, if NFP doesn't kill us tomorrow, we'll have to add one of the above bull call spreads to look for a $2,000 bullish offset in case things keep going higher.  Dollar 78.95 at the moment, slammed back down since 10:30 to support oil and nat gas but I only care about 78.85 and what the BOJ does about it.  We still want to kill those BKS puts for .10 if we can….

    Speculators/StJ – Larijani for President!!!  (that ought to score me a visit from HomeSec). 

    OPEN/Lol – I never liked them but they are boring to short now as we caught them from $100 to $40 last year.  I remember last year I was having steaks with Sam Antar and a couple of other guys in NYC and Sam was talking about what a scam GMCR was running with their books and I said "You want a scam, OPEN is a scam with a 200 p/e" I did the math for them on the napkin (also done in chat at the time) and we called the owner over and he confirmed the numbers I was using as they applied to his restaurant.  There's just no real growth there.  Groupon and the new LivingSocial are in the same boat – just because you have a useful app does not mean you are worth $1Bn but you can't bet against these guys right now because Facebook is about to make OPEN look like a bargain by comparison and it's all the same thing (web stuff I've heard of) in the minds of most investors.  

    Speaking of web stuff – SOCL still on the march, up another $1 on expectations they somehow have an in on getting Facebook stock.  More like they will be forced to buy it at the top and it will wreck them but, sadly, they don't have options yet.  

    Thanks L4, 2Can!  

    Selling the news/Garcia – EWG is right back at the 200 dma at 22.25, that's up from 17 in September so 30% better on Greece being fixed seems a bit extreme – especially with the PII-S still to go.  But, as I said above, a fine job has been done by the Corporate Media to fixate investors on Greece, much the same way a magician gets you to focus on the hand he is moving in big, sweeping motions and not the hand he holds still and subtly palms a card or whatever.  When Greece is "fixed" the ECB will yell "PRESTO" and the IMF will play "Ta-Da" and there will be a huge burst of enthusiastic applause (rally) and THEN some small boy in the audience will point to the Emperor of the next Piggy Nation and say "But sir – that one doesn't have an clothes either" – and then we will likely go through this cycle all over again.  

    Stevens/Msf – Yeah, I think if the school were properly called Hoboken University, people wouldn't take it quite so seriously. 

    96.67%/Pharm – Wow! 

    Foundations/Peedle – Yes but he's sheltering the money he's already pledged to the charities (essentially re-investing it for them to build their donation) FOR the charities so it's not his money to take anymore and – oh what's the use?  Really, if you are determined to read negative motives into people you can twist anything up, can't you?  There are sites that badmouth that selfish bitch, Mother Theresa as well – whatever it takes to make you think that being greedy and selfish is "normal" and people who are giving and caring must have ulterior motives or some kind of mental sickness because THAT's the way society should be now, right?  

    “Through clever and constant application of propaganda, people can be made to see paradise as hell, and also the other way round, to consider the most wretched sort of life as paradise.” – Hitler

    It is part of the general pattern of misguided policy that our country is now geared to an arms economy which was bred in an artificially induced psychosis of war hysteria and nurtured upon an incessant propaganda of fear. – Douglas MacArthur

    The American fascists are most easily recognized by their deliberate perversion of truth and fact. Their newspapers and propaganda carefully cultivate every fissure of disunity, every crack in the common front against fascism. - Henry A. Wallace

    Propaganda does not deceive people; it merely helps them to deceive themselves. - Eric Hoffer

    FAS/Yodi – No, we're taking $1 of profit off the table because we're not greedy bastards and we recognize that we're lucky to hit the top of the range so quickly so no point in pressing our luck. 

    FAS/L4 – You mean the MARCH $70 puts?  The Febs were $75 puts.  

     LOL Flips, voluntary or not, the money is real and it is really transfered from you (who earned it) to them, who spend it.  It's not your money. You freely choose to live in the USA and the "rent" for living in the USA is taken out through taxes.  You can play all the convoluted tricks in the World but taxes are essentially a common maintenance fee that is assessed on US residents and are just as valid as condo association fees.  You don't HAVE to live here but, if you do – that's the deal.  Why is it Conservatives are so happy to say "if you don't like it – leave" to everyone else but, when they don't like something – it's UNFAIR!  

    And what Yodi said!  

    Zynga/Lnkarri – it's such a dangerous short ahead of Facebook fever.  I would hope Facebook goes to the moon and then we can just short all the stuff that flies too close to the sun with them.  

    Romney/Angel – I do find that admirable about him but, again, Buffet's salary last year was $100,000 from Berkshire and $75,000 from being on the board of KO, he gives all of his speaking fees to charity and had capital gains of $39M so about $40M total.  So, the $100M he gave came out of his remaining personal assets, which he is liquidating for charities as well and that means he gave 150% of his income to charity last year.  You can rant away but I do expect better from you than regurgitating baseless Conservative attacks on people who actually step up and try to make a difference in this World because there are other people who respect your views, read it and don't think it's a joke but rather a confirmation that what they hear on the propaganda networks are true – who does that help?  This is my site and people will read these comments for many years to come so excuse me if I care about what's said here – all that's required for evil to triumph and all that…

    Thanks Pak!  

    Facebook/Angel – I wouldn't stand in their way.  Profit growth is astounding although I imagine they are finally going public because they are peaking but they can be spun very positive for quite a while.  

    Facebook/StJ – That's the killer, right – AAPL would be worth over $2Tn if it were valued like Facebook.  

    GMCR/Kallen – I was but the results were too strong.  Hopefully they get to $80, where I'd be more comfortable setting up something I would roll and stick with to $100 if necessary. 

    Dollar back below 79.  Not helping oil – $96. 

    PCX/Acobra – Madness.  

  93. Feb 2 (Reuters) – Chipotle Mexican Grill Inc: * Goldman Sachs raises Chipotle Mexican Grill Inc price target by $15 to $425

  94. Hi Phil: A few days ago, I followed your guidance and  opened  a hedge by buying 10 EDZ April $12 C,sell April $18 C and sell July $12 p for net $.05 on the $6 spread. Position is now negative $1.00 on $6 spread.EDZ . Leave as is or roll down to July $11P? thnaks

  95. angel – Just for discussion I'm curious what you believe an appropriate market price for FB stock would be and why? What p/e would you put on their earnings and growth rate (and 845 million customers)? I'm no defender, it's not my kind of stock as I generally look for things that are undiscovered or out-of-favor and this is certainly none of that. I'll look forward to reading yr comments later as I'm off for the afternoon now.

  96. Don't you just love people who make good money, then whine about paying taxes?

  97. OMG  / Pharm – Why not? Probably they would be better than all the zyngas and chipotles out there.  Maybe we can also go long the WTF as well. Oh no, this ticker is still available.  
    Phil here you go i found you a ticker for your Berkshire company when it goes public: WTF

  98. TLT play update. TLT is at 119, which is in the middle of the range i play it at. I prefer to sell call spreads at .90 when TLT is above 121 and prefer to sell put spreads when TLT is below 117. Will wait for one of these to occur (will happen either this week or next, most likely at 121+).

  99. WTF is going on with oil? MC? What happens if the $ perks up!

  100. @Felipe 
    'It's not your money'. 
    You saying it and the government saying it, doesn't make it true.  A fact, maybe, nut a lie, nonetheless. 
    It's mine. It's taken thru extortionary tactics. It's taken at the point of a gun.
    And leaving MY country because it has been hijacked by a FEDERAL government is a non-starter, though, like you I have my eye on several places that will be more to my liking.  It's me twho should be telling the government to begin to fear me, as it should. 
    That so many hundreds of millions of  us fear our government is the saddest commentary that could be made on the state of legislation in this country. And CONgress backed up by the IRS  tops the list of tyrannical forces in this faux democratic republic which sees fit to institutionalize tax breaks for the top 10 per cent while having the middle classes pay for it at the point of a gun should you decide to not pay.
    And I won't even get into Withholding.  A while 'nuther tyranny.

  101. MON acting stubborn at 82.5. Down PIG :-)

  102. Phil, worth a short at oil long at 95?

  103. Phil / Speculators/StJ  – Thanks and yes, your comment appears to be non-NDAA compliant.

  104. Rates near zero are “punishing savers” and could be leading portfolio managers to take “unwise risks,” Plosser said. While the Fed’s goal has been to encourage a move to riskier assets, “we don’t know the full consequences of that,” he said. – Plosser Philly Fed


    So now we know that the Fed is doing what it is doing to increase risk appetite and keep the market on 'roids.

  105. low volume and market is moving DOWN…what is going on here!

  106. From Bloomberg: Earnings beat projections at 67 percent of the 246 companies in the S&P 500 that reported results since Jan. 9, according to data compiled by Bloomberg. The S&P 500 is trading for about 13.7 times its companies’ earnings and has been stuck below its five-decade average multiple of 16.4 since May 2010, the longest stretch since a 13-year period beginning in 1973.

  107. Pharm / CLDX – whoa nelly, what's going on here?  should i take 20% profit?  this sucka has been under water a long time. 

  108. Phil – this might be a stupid idea (if so please say so), but I'm wondering if it makes any sense to roll my 10 APR 25 EDZ short calls to one short MAR EDC 121 or 122 call? My thinking is hopefully either expires worthless, but it might be easier to roll one EDC call up and out than 10 EDZ calls if not, plus it takes a month off the time. I rolled my 10 long calls (APR 21) down to 3 APR 16 and 4 APR 14 calls (I had to put in a little cash). I also sold 3 APR 16 puts along the way. I'm thinking of leaving the rest alone for now. Any other advice? 

  109. Phil,
    You know I love you.  In agreement with you politically 95% of the time.  But the slight of hand… the propaganda here, is the super wealthy shifting the tax burden to the "little people" by sheltering it in foundations that dole money only to their own interests (mostly seeing their names on buildings)… And amazingly they pull this trick while having their asses kissed and getting treated like saints.
    I call bullsh!t.
    Give everything away! Please.  But do it with after tax money.

  110. GLD not making any headway and it is at OH resistance.  Shorting in here for a scale in.  GLL ain't doing anything for me so go to the source!

  111. CLDX/terr – do I need to tell you the rules here?  At least 1/2 and sell some calls against it.  Plz Plz Plz…..

  112. again BURRRP..I love you Phil..but not the High Priest of Proselytizing (HPP)..and as the poster child for spewing you shouldn't  throw stones..that said i don't 'SPEW" anyone else's jargon (just my OWN)..much less some right wing drivel about this person or that cause..we all wear clown hats at one time or another on this tableau(you have one that looks like a crown) i have no dog in the constant prattle about left or right liberal or conservative..i just help those who need it and couldnt give a crap about what they believe or if they are blue or red..but as brothers Phil on occassion we must agree to diasgree; remember we are better and stronger for having  the opportunity (to knee one another's nuts off) to share our mutual respect and love for one another..i suppose i will be buying the next dinner..

  113. JRW, still short?

  114. All – Biotechs are screaming right now, and I think the risk appetite is in its last wakes.  Maybe I am wrong, but when I am up this big, this early, then it is time to re-evaluate why these things are up this big!  I am not saying go crazy and sell everything, but I am reducing exposure to many of these that have been under water (where I am even or slightly up on) or are up big.  PLX for instance, I am trying to sell some of my holdings 1/4, as it comprises 1/4 of one of my accounts.  That is ridiculous….even for me.  I think the day traders are moving these around like candy as they are small change.  I mean look at CLDX over the past few weeks.   Up on WHAT news????  CRIS has twice the market size, an approved drug, and CLDX is no where near ready…..

  115. Phil – EDZ/EDC – upon further reflection I'm going to say that's probably a stupid idea I had, it makes the whole trade even more directional. Selling one EDC MAR 92 put isn't that attractive since we were there just a few days ago. I guess it's better to just leave it along altogether, though of course I'm open to ideas.
    What's up with TOS showing APR EDC 45 puts at .45/.75 but 40 puts at 16.20/20.40? Did they rebalance recently or something?

  116. Pharm/Risk Assets
    Perfect example on why we need Financial reform!  Very little "Organic Growth" occuring in the economy, so the next best solution is to fake it by devaluing the dollar and forcing in frustrated savers from their 401k's, CD's, Stock and money market accounts as they are nearly desperate to get a return on their cash, which many depend on for living expenses!
    The alternative is to do nothing and watch you cash de-value by 8% and spend 10% more on fuel, goods and services because of the inflation that the FED says doesn't exist!
    The sad part is many wind up incurring losses they would never have received if safer alternatives other than their "Mattresses" were available as a result of fees, commissions, poor decisions and market manipulation IMO!

  117. Hi Phil,

    Trying to learn the right way to handle selling puts to reduce cost of stock in a long term IRA portfolio. Want to see what rules apply to closing — buyback times and resales.
    I've bought CIM shares for the dividend — don't want to sell calls for all the obvious reasons.
    I sold 20 Mar 2012 $3.00 put for .45 and now they're about .10 right now — 77% with a month to go.
    Should be a no brainer I suppose but there's still .6 a day to be gained and I can't put sale that would do better.
    So is it best to buy them back now and wait for better opportunity or just let them roll to expiration?


  118. BSX
     What do you mean by bad? What's the reason you don't like them?

  119. Charities
    Giving money to charities with after tax money would decrease dollars to charities.  My farmer parents -not wealthy – gave $350,000 to 5 charities serving the disabled and poor after their death.  There were capital gains tax benefits at time of property transfer 17 years ago. It also, allowed them to increase retirement income during remainder of their life which they paid additional taxes to government.  The assets were allowed to grow tax-free then distributed to the charities.  This gift would never been able to happen without tax considerations because it made no economic sense. Thinking of the Gates and Buffet's in the world….. ignores, the fact very ordinary people contribute vasst sums of money to charities….     

  120. @Yodi
    Checked out Belize during the week of January 1 while I was in Mexico (which has, if you can believe it a more humane airport security system in place: you must, don't you live there?) .  I couldn't live in a climate like that yr round,
    There are others, but a temperate climate with changing seasons is ideal.  That's why I  like the greatest country on earth, the United States.  That it has been pillaged by the Oligarchs and Plutocrats is a tragedy. That its people have gotten fat, lazy, and uninspired is a reflected in our lack of protests against our government.  The United States is a perfect, it's the Federal Government that is corrupt, diseased, and incorrigible.

  121. Phil
    The FAS Feb 18 77/80 BCS selling the $75P is about  net 1.33.  Approx .83 from when you first posted.  Attempted to get filled a couple of times to no avail.
    Does it still make sense in this range or is that considered "chasing" Of course, this is based on what currently appears to be a "viable bullish basis" , notwithstanding the obvious lack of volume and Taxpayer funded liquidity that's making this baby "Levitate" IMO.
    Of course, I have not forgotten your messege from yesterday regarding PATIENCE!

  122. Does anybody know exactly when will Facebook start selling shares?
    How about going long on OPEN, and other MoMo or internet stocks, with some fun money, betting that they will be lifted by the excitement?  Besides OPEN, what else might be lifted by Facebook?

  123. JRW: Still short?

  124. Phil
    good afternoon
    Would you consider a $100,000 portfolio to make it a $500,000 portfolio?
    Yes, in one year!

  125. acobra,
    Please don't get me wrong.  I am 100% for charity.  But we have a huge funding gap in the USA.  I'm sure there is a middle ground… perhaps a % of yearly tax obligation could be free of tax burden.
    What grinds my gears are the super wealthy acting like saints because they don't spend a full trillion dollars per year on themselves.  Even Goldman Sach guys can only spend so much a year on boats and planes…  
    If the top .01% weren't hoarding so much of the wealth, we would need vastly LESS charity.

  126. Facebook/Pakdog:  Heres an interesting assessment of the Facebook S-1 from a value investor's standpoint:

  127. mampcsA / Short

    Sorry, I missed your post. No, I bailed the short at about 12:45; I think we close here or slightly higher (following the trend line now at IWM 81.14 !!


  128. Thanks JRW.

  129. peedle
    "If the top.01% weren't hoarding so much wealth, we would need vastly LESS charity"…..
    Amen to that…. my solution for them would trigger "tweet alert"…..

  130. Should see a move higher going into the close for oil…its the usual move..

  131. acobra--great post about charities! ;-)

  132. EDZ/Dflam – It's a bit early in a 3-month hedge to worry after 3 days.  As you go to lower strikes, the spreads get kind of crazy but, if you can roll down in the money for .50 per $1, that's kind of a no brainer so I'm always going to like offering $1 to roll to the $10s and, if you get it – great – if not, then EDZ is at $13 and you're $1 in the money on a net .05 spread – wa, wah….

    Taxes/Kongen – If I'm allowed to protest 40% of my tax dollars going towards the military (or does this make me unpatriotic?) then I don't mind other people protesting whatever sliver of money goes to help the needy but it is ridiculous when, well when Flips makes these kinds of statements as if some random Government took over his country and is taking his wealth at gunpoint.  Mexico is right on the boarder with an 18% rate – feel free to open up a store there and see how much money you make, free of all that nasty "Government Interference".   Germany's Corporate Tax Rate is over 50% and their personal rates are 38% and they're kicking our asses – go figure…

    WTF/Dpast – I live it.  How about "What The Fund?"  

    TLT/Mampcs – Good plan.  

    Mine, mine, mine/Flips – Daffy would be proud of you.  

    Oil/Mampcs – Not just for the sake of going long.  $92.50 is a serious enough resistance to play a bounce but Ben wasn't very encouraging this morning and oil ain't worth no $90 without more QE.  

    Plosser/Pharm – You know, the fact that he says "we don't know the full consequences" is what's really scary – "but we went ahead and did it anyway"???

    Down/Sage – Those Forex levels are a lot tougher to fake out than index levels because Japanese housewives are a lot smarter (and more Conservative) than American Retail Traders as a group.

    EDZ/Kurt – It's margin efficient and you have decay on your side as well but a bit more complicated to manage.   Certainly you don't want to sell an EDC put as it was $65 45 days ago and you have 78 days to April expiration.  On TOS, you are looking at two different contract types – be careful.  

    BS/Peedle – As I said, no point arguing this as it seems to be a religious belief that you have and not a point of fact.  Shares of stock were donated to maximize the gift to the charities but the charities have since been able to benefit from the compounding returns of those shares over time.  I don't have any problem with people choosing to donate to charity rather than give it to the Government.  In fact, if you don't like what the Government does with your money – you should do the same but most people who pretend they care about fairness have no intention of giving a dime to charity – they just want to keep more for themselves.  Also, given Buffett's 17% tax rate, even if he were taking deductions, they would be 1/2 what an ordinary citizen takes when they donate to charity – that sword cuts both ways.  I feel the government doesn't do enough to feed poor families so I work and donate to those programs, Tina likes to concentrate on education and donates money and time towards improving our community schools, rather than sending our kids to private schools, she works every day to give our kids and EVERY KID a quality education in our public schools.  The improvements she's helped make in just 10 years are stunning.  We also pay a school tax but it isn't enough so we redress the imbalances as we see them.  Every citizen has that right and we don't need our names on buildings (I challenge you to find one  with Buffet's name on it) – as alien as it may seem to you – some people just want to help other people.  Because we can and because they need it – it's really not that complicated.  

    CIM/Zip – It depends what you're trying to accomplish.  Is it worth .10 for you not to get called away at $3?  This is a pretty lousy stock to try to hedge although the dividend is fun but, to me, I'd let it go for $3 and just sell the Sept $3 puts for .35 as that's more than you'd get in dividends for owning the stock and, if it gets assigned back to you – THEN you can sell some calls.  Or, conservatively, you can sell the Sept $2.50 calls for .65 against your $3 stock AND the $3 puts for .35 more and now you've collected $1 on your $3 stock (33%) and you still get your dividends unless they call you away and then you have $3.15 from the call side and a possible re-entry at net $2.65.  If they call you away with a .05 premium once a month – you'll be doing better than the .11 dividend so why worry about it?  

    BSX/Lol – Who me?  I do like them as a company but their stock is bad – in that it goes down and down and down and down so what's the point?  The reality is they don't make any money so you have to be very patient and, generally, investors are not patient.  

    Good point Acobra.  

    FAS/L4 – Well, first of all get off Feb and you'll be better off.  Clearly with FAS heading up, it's a lousy time to sell puts or buy calls so either wait PATIENTLY for a good opening or simply grab the March $77/82 bull call spread for $3 and don't sell any puts UNLESS we sell off.  If we sell off, the $62 puts are now $1.40 so probably you can get $2 for those and, if we never sell off – then you are starting with FAS at $84.60 so your'e over 100% in the money to make 66% in 43 days without the offset – is that really not enough for you?  

    Facebook/Cwan – I don't think there's a date yet.  You may as well go with SOCL if you want to be a believer.  

    $100K/Maya – Are you suggesting taking $100,000 and going for $500,000?  That's hugely irresponsible. To be that aggressive, you will fail about half the time (see current $25KP) and you should never take a risk like that with money that can't be replaced in one year (so the most you lose is a year of time along your investing path).  If you are making enough to throw $100,000 at a gamble, then you don't NEED to make 4x in the first place.  We never set out to make that kind of money, we just compound our gains if things go well – forcing it is usually a mistake.

    Charity/Peedle – If Corporations in the US actually paid 35% taxes, we would need a lot less charity.  Charity isn't the problem, loopholes that allow people and corporations to pay less than 30% is.   We have a $15Tn GDP and a $3Tn budget, therefore 20% of all goods and services should be taxed and then we don't need to collect anything from anyone – simple enough?  Even Flips might like that as he doesn't seem to mind sales taxes.  

  133. Oil / Phil – Would you suggest a bullish play on Oil? What do you think? 

  134. flipspiceland
    I live near Cancun Mex. Like to hear your opinion about Belize and where did you go in Belize?

  135. Like I said….tough crowd…

  136.  Lot Alphas males on this site. Give 'em a super boring day and they start to chew on each other.  Just drink the Kool-ade and be cool, brothers, you know this markets gonna keep going up — our government is inflating away the dollar while paying absurdly low rates on dollar balances.  Nobody fights the Fed — for long.

  137.  Lot Alphas males on this site. Give 'em a super boring day and they start to chew on each other.  Just drink the Kool-ade and be cool, brothers, you know this markets gonna keep going up — our government is inflating away the dollar while paying absurdly low rates on dollar balances.  Nobody fights the Fed — for long.

  138. Wow, I didn't know you could do that!!  I must have a clone.

  139. AMZN trade:   Yesterday sold 175 weekly puts for .95, bought back today for .34    and now……sold weekly 180 puts for 2.00.     

  140. I may buy these back before EOD.  

  141. ISRG flying, Jan puts dropping fast already.  

    63M on the Dow at 2:15!  

    11:43 AM European shares close mostly green as never-ending Greek debt restructuring talks become comedic sideshow vs. an ECB liquidity program that looks to be in control. Stoxx 50 +0.3%, Germany+0.6%, France +0.3%, Italy -0.3%, Spain +0.8%, U.K. +0.1%. Euro flat at $1.3160

    1:00 PM On the hour: Dow -0.15%. 10-yr +0.08%. Euro -0.07% vs. dollar. Crude -1.86% to $95.8. Gold +0.5% to $1758.25.

    2:00 PM On the hour: Dow -0.09%. 10-yr +0.11%. Euro -0.09% vs. dollar. Crude -1.71% to $95.94. Gold +0.55% to $1759.05.

    Mortgage rates broke down sharply over the last week, according to Freddie Mac's latest survey of lenders. The 30-year fixed dropped 11 bps to land at 3.87%, while the 15-year variety clipped 10 bps to hit 3.14%. Both fixed-rate and ARM mortgages reached record rate lows.

    Long-term Treasury yields that continue near all-time lows even as the economic numbers improve and risk goes full-on in 2012?Look no further than Operation Twist, under which the Fed has purchased 91% of the government's 20-30 year debt issuance. What happens when the Fed stops? What happens to the Fed's balance sheet if rates rise?

    The Swiss franc takes just a bit of a tumble as acting SNB chief Thomas Jordan vows to enforce the euro/franc floor of CHF 1.20 with "utmost determination." Traders have been testing the bank's mettle, pushing the pair down to 1.2030 yesterday. It's bounced to 1.2053 since Jordan's comments. 

    Italy's remarkable bond rally continues, the 2-year note yield diving 19 bps to 2.98%, the first time under 3% since June. Eight weeks ago, the yield was north of 7%. The 10-year is off another 8 bps to 5.6% Italian bond futures ETN: ITLY +11.7% YTD.

    Liquidating assets is not limited to major financial institutions during times of crisis. Regular citizens in debt strapped sovereigns like Italy are also being forced to sell assets to survive, and gold is a first choice given its highly liquid characteristics. But just as rapidly expanding gold collection businesses like OroCash demonstrate, the market is eager to buy the yellow metal on the cheap whenever possible, as gold remains in a strong long-term uptrend and represents an attractive safe haven during times of crisis.

    China reaches parity with Europe in venture capital financing for the first time, as Chinese companies received $6B in 2011, up 8% Y/Y, vs. $6.1B in Europe. As recently as 2009, European start-ups were receiving 86% more in VC financing than their Chinese counterparts. The bets in China are big, too: The median deal size in China was $12.4M in 2011, vs. $5M in the U.S. 

    Bulls are gloating following Green Mountain Coffee's (GMCR +20.6%) strong FQ1 (III) and soothing FY12 guidance. KeyBanc, a stalwart defender, notes Green Mountain's 4.2M Keurig shipments blew past its 3M forecast, and that free cash flow was positive in spite of rising spending. During its earnings call, Green Mountain mentioned Keurig-based brewers accounted for 37.5% of all U.S. coffeemaker sales in FQ1 (per NPD).

    No layoffs, just a pay cut:  Barclays (BCS) plans a 25-30% pay cut for the 24K employees in its investment banking unit, according to sources, and will also eliminate about 5% of the senior bankers in that group. This move follows similar action across the banking sector, both in the U.K. and this side of the pond.

    Research In Motion (RIMM +1.9%) spikes following a rumorthat Vodafone (VOD) is interested in buying the company. However, Vodafone says there's no truth to it.

    "One of the good things about Facebook (FB) ads," writes Mark Gimein, "you don't have to spend a lot of money to know when to quit." Gimein relates a campaign of his that saw a click through rate(CTR) of just 0.014%, with most of those likely "slips of the mouse." He wonders if Facebook can match Google's (GOOG) strength of offering easily measurable results. 

    The Facebook (FB) valuation debate (IIIIII) continues.Mark Gimein notes that even at $75B, Facebook is valued at $89 permonthly user, in spite of generating annual revenue of just $5.02/user. The 17x ratio between the numbers easily outdistances GRPN's 8.3x, never mind NFLX's 2x. Though the fact Facebook still produces so little revenue per user, in spite of owning volumes of user data, suggests it has plenty of room to improve monetization. (more)

    The Zynga Math: After hearing that the social game makeraccounts for 12% of Facebook's revenue, investors run up shares of Zynga (ZNGA19.2% on a justification that yesterday's market cap of $8.94B could be a little light if Facebook goes public with a valuationclose to $100B.


    The social network and internet space displays continued momentum following Facebook's IPO filing. Zynga (ZNGA), whichrepresented 12% of FB's 2011 revenue, +17.7%. Also: RENN +7%,GRPN +6.6%LNKD +6.4%YOKU +4.6%DATE +3.1% SINA+2.6%QPSA +2.3%.

    Investors may own a piece of Facebook and not even know it. A fair number of mutual fund companies hold pre-IPO shares in Facebook, although for most the stake is small. The notable exception is T. Rowe Price Associates (TROW -0.5%) as an owner of 5% of Facebook with shares distributed among 19 different funds. Facebook's share price will have the biggest impact on the T. Rowe Price Media and Telecommunications Fund (PRMTX) – since it holds the highest percent of its holdings in FB.

    In an ironic twist considering the history (video) of the companies, IBM may deploy more Apple (AAPL) hardware – 30K iPhones, 10K iPads, and 10K MacBooks – than any other enterprise in the world. IBM's deployment, further evidence of Apple's boomingenterprise sales, trumps Lowe's 42K iPhones and Korea Telecom's 32K iPads. (yesterday)

     Not only did Apple (AAPL) become the world's top smartphone vendor in calendar Q4, courtesy of 37M iPhone shipments, it also became the #3 mobile phone vendor overall: IDC estimates Apple's Q4 phone share surged 470 bps Y/Y to 8.7%. Nokia (NOK) retained the top spot, though its smartphone woes led its share to fall 410 bps to 26.6%. Samsung's share rose 280 bps to 22.8%, while LG's fell 350 bps to 4.1%.

    Three lunchtime reads:

    1) It is safe to resume ignoring the prophets of doom … right?

    2) United States of Europe? What it will take to save the continent from economic collapse

    3) Why analysts can't properly value stocks and bonds

  143. Phil,
    Need your expert help with a Feb EDZ that might need to be rolled….
    Feb 19 call  buy @ 1.47
    Feb 24 call Sell @ 0.67
    Feb 17 Put Sell @ 1.76     7 contract
    Thank you

  144. AMZN  trade   / and now a stop loss order……if AMZN drops below 180  buy to close the 180 puts at market

  145. And the AMZN trade is done…17 minutes and + 26%.  Now that was fun. 

  146. Since this is a rather boring time, let's look at the bigger picture. "They" still have to close above SPX 1328 to negate my scenario. Here are two great charts from SHJ:

    And a close up:

    And here is more evidence that this entire "rally" is BS !!

    But we will probably need some "real" news to break the grip "they" have on this market !!

  147. Shall we start a AMZN 50K portfolio lflan?

  148. Oxen Group opened new long in $MNST. Believe the stock has near-term upside to 108.50. Breakout there would take the stock to 110. Catalyst is recent weakness providing buying opportunity, upside into earnings and stock split, analyst upgrade.

  149. Grip JRW….

  150. Maya…….I can't help echo Phil's comments about taking $100,000 to $500,000 in a year.   I've seen traders blow up their accounts trying to make money rapidly.   I think the best of traders can shoot for doubling an option account in a year.  I don't think that's unreasonable.  The way it's done is to seek small victories.  Find a high probablilty trade and risk a reasonable amount of money on that trade.  If you do that you soon find that your account is growing rapidly.  Consider a 50k account where you could make 'only' 200 bucks a day.  In a year that would be ……..a double!      Lots of small victories plus don't lose money.  That's the way you do it.  But 5X in a year ?   Not reasonable.  

  151. I still hold my grounds that bonds tell the story of this market.  Risk is on for the market, but 10 yrs are going to 1.5%… grip or no grip, I will gripe that until I am blue in the face.  One has go give….and I don't think it is going to be bonds….

  152. stj…….. Sure, why not?   :)       Reminds me of this fun idea I've had where you pick a stock that I have to trade and I pick a stock that you have to trade, and see what we can do with it.  Anything that's fun and hones our trading skills would have to be a good thing.    Can you pick AAPL for me?    :)

  153. JRW or SHJ – re the SPY chart with highlighted stochastic valleys.. can you elaborate what this is demonstrating? is it just 11 out of 14 valleys indicate a short term top (only two before really significat drops) or is there something more to say another big drop is coming?

  154. NAS up .29%, AAPL down .29%.   Am I detecting a slight bit of weakness here?

  155. scottmi / Big drop

    At least a pull back, assuming "they" will let that happen !!  8-)

  156. lflan & stj: Let's rename it Amzn-Aapl port.  Amazing Apple, that is.

  157. With no volume, it is easy to churn.   They need retail….badly.

  158. AS far as indicators go today looks like yesterday and the day before. Triple crossing SMAs in the afternoon. Will we get most of the volume at the close again? Yes = wait. No = What next? JRW's last post looks most likely to me.

  159. lflan,
    If AAPL pulls back, at what price range do you think is a good opportunity to go long?  I can't follow your trades (too fast!).  So, an early heads-up would be nice.

  160. my buddy who trades for institutions said they are as dead as he has seen in 10 years, so the algos are just trading for "credits" not sure how that works, but his statement. If HFT's make up 70% of trading volume what is it in an anemic market like this 95%??

  161. Pharmboy,
    Is TLT a 1x or 2x ETF?  Does it have decay?

  162. Iflan: Would you want to sell some weekly AAPL calls to protect some of the gains?

  163. JRW/ Charts
    Good info JRW! I like the fact that you quantified the B.S. Rally with the last chart which appears to show volume at different price points!

  164. Challenge / lflan – You want me to pick trades in AAPL and you'll pick trades in another stock I choose? Sounds like a decent challenge, but we need some more details – for example, amounts at play, types of trades (swing, daytrades, etc..) and timeline. And when we do we switch? Other than that, why not. That could be fun…

  165. Portfolio / Cwan – LoL… 

  166. Phil, 
    we know your stance on oil, it would be really interesting to know what do you think about agricultural commodities. Not as a day trade but as a longer perspective play, a year o so. Just general thoughts.

  167. Speaking of trades, on the FAS Strangle, I'll be covering the short puts by EOD. We'll have jobs tomorrow morning and if they need an excuse to pull back, that could be it… 

  168. Phil, Somehow you missed my point completely.    I applaud all charity.   It elevates humanity.  I particularly admire and support hands-on, local, accountable groups that help less fortunate families in our own communities (many great ones here in New Orleans).  But wouldn't you agree that there is a huge difference between these type organizations… and some super-rich person who starts his own foundation and puts himself and his family on the payroll at a lavish salary, writes off lavish travel expenses, and shifts the tax burden down to people barely getting by (many of whom donate too!)?  It seems incongruous to me to oppose corporate loopholes, but not oppose these blatant loopholes.  Both come from the same problem. The influence of the super-rich on our political system.  If Gates and others are as altruistic as you say (and I'm not saying they are not!)… then they will gladly support charity regardless of the tax implications.

  169. cwan….Generally, here's what's in my head for AAPL right now:   Below 430, take some long positions.    Below 420, double down.   Below 410  double down again.   Below 400……well, maybe back up a truck?     These numbers, of course, presume all other things being equal.   By that I mean that the US and World economies aren't going to the hot place  in a handbasket.  I say that because when we aren't near earnings AAPL sort of moves with the market in general. 

  170. JRW/ Charts
    The lack of volume in the last chart  also seems consistent with sagemm1's 3:00 comment:
    February 2nd, 2012 at 3:00 pm | PermalinkIgnore this user
    my buddy who trades for institutions said they are as dead as he has seen in 10 years, so the algos are just trading for "credits" not sure how that works, but his statement. If HFT's make up 70% of trading volume what is it in an anemic market like this 95%??

  171. stjeanluc
    FAS strangle Since when do we still have puts

  172. Verooom vrooom …. 

  173. stjeanluc
    Even FAS money we closed the puts?

  174. etrading………You could do that.  I would play AAPL right now using "neutral"  strategies.    Long-term bull call spreads, out-of-the-money calls and puts, and so on.   And of course one of the best ways to protect gains is just to stay in cash and wait for the next opportunity. 

  175. PHil – have a look at silver, AGQ creeping up, time for something bullish here?

  176. stj….No, I meant you give me AAPL to trade and I pick another stock for you.  I was thinking, uh, maybe General Electric or Pepsi?     

  177. Euro ticking up, might trigger slight closing rally.

  178.  t.boone just told someone on bloomy that oil would be DOWN "couple of bucks within the month"….NEVER heard him anything but uber-bullish on he must be really worried

  179. Wow, that's some spike in oil into the close, back to $96.50! 

    Good call Kustomz.  

    Oil/Dpast – No, I think they data is so far against them.  If the Dollar is at a floor, they could fade fast.  

    EDZ/Jasu – 50%!  If you don't do something before you lose 50% then you have decided to go all or nothing.  At the moment, you are miles past nothing.  The net on the trade was about a $1 credit on the $17 puts (now $4) so that's your issue and all you can do is forget the $1 and roll your $3 loss out to the April $15 puts ($3.30) and hope it comes back.  If you want to make a new bullish play on EDZ, that's a separate issue.  You could sell 3 more short puts for $9 and buy 10 Apr $12/15 bull call spreads for .90 but that does leave you with 10 short $15 puts and, if we keep rallying, it could get worse so maybe just be thrilled to get even at this point.  

    AMZN/lflan – Nice.  

    Good charts JRW, thanks. 

    Dow volume 74M at 3:15 – This is tedious. 

    Oil/Urmana – Welcome!  You must be new to ask my stance on oil.  It's fake.  US demand is down over 5% from last year and global demand not much better and production is up and going higher.  High supply – low demand – if it wasn't for the constant nonsense from Iran, oil would be $85 tops.  As to ags – another insane sector that goes up and down on rumors and speculation.  Pullback of ethanol subsidies and loosening of tarrifs from Brazil on ethanol (where they can make it way cheaper than here) will lead to a massive glut of corn here and other ag products.  If we're nice, we'll take advantage of the cheap tanker rates and send the food to hungry people but most likely we'll let it rot in the silos and it will be a bad year for Ags.

    Foundations/Peedle – It depends on the foundation.  The Gates foundation is incredibly effective but they save brown people and Americans don't care about brown people.  Other foundations can be tax dodges but there are many, many more that do great works – particularly things the Government doesn't do like saving rainforests and preserving the eco-system and helping rebuild inner-city communities.  I don't oppose charitable loopholes when the money really goes towards charities as that is the idea (or should be) of government spending anyway – to help those who are less fortunate – to REDISTRIBUTE the wealth more equitably.  What should not be deductible is political donations – that's complete BS and, as I said, if you want to revamp the tax code, then put a 20% VAT on all goods and services in the country that has no loopholes and suddenly the Government is collecting $3.2Tn off a $16Tn GDP and you get to keep 100% of your paycheck less FICA, which we'd need to keep until we pay off the debt (15 years or less under that plan) and the only time you'd ever pay a "tax" is when you want to buy something.  Since you would only end up paying 26.5% max (with FICA) and that gives the government 100% more collections than they have now – imagine how much other people are cheating.  Also, we would not need tax accountants or tax lawyers or the IRS anymore, saving people countless Billions more Dollars! 

    AGQ/Jercon – I think it will top out with gold but I've been wrong about gold so far…

    TBoone/Angel – Wow, even the big guy is capitulating?  No wonder CNBC hasn't had him on….

  180. Trades / lflan – Well, in this case, no deal… How much of a challenge would that be man! You want to make it interesting…

  181. Phil, 
    I think I probably know the answer, but I'll ask anyway. I have 2013 BA 60 puts, sold for $10.65, now $3.125. Hold it longer or sell it now?
    Oh, and Hoboken University  : )  : )

  182. FAS / Yodi – I sold some puts this morning at 10:04 as I could not watch it go up and do nothing… I guess I am hoping to pay for the roll!

  183. Maya, After years of being pretty good at picking stocks I still managed to lose almost as much as I made.All the reading Phil asked us to do as a new member (And everything else I can get my hands on lately)  has revealed my Achilles Heal.Good stock picks do not necessarily make money. My problem was swinging for the fences. If an investment was good I would put 30% to 40% of my money in it  and scale up. Example, I correctly called the real estate crash in 2008 and happily traded 300 to 500 shares of SKF almost daily and made a ton of money doing it.
    Then in Feb 2008 I thought why not make some real money and started trading $5000 shares a day, in and out. and managed to lose $50K more than I had had already made in SKF..Reading PSW strategy made it clear I had no disciple, no hedging  and no risk management at all.
    Since becoming a member Jan 1 this year  and getting into to scaling into small trades I am amazed at the steady profit  growth I have experienced  already while not worrying about getting killed. And  having fun doing it..
    Phil, Thanks for the education, the help you give and the chance to learn more and get better. Also thanks to all the members who have  answered the few questions I had when your not around.

  184. lflantheman/AMZN trades, great call at 2:11pm, I would like to get your thinking to sell AMZN weekly 180 put at that moment.

    AMZN run up from $177.60 to about $179 in 40mins when you posted the trade.  For me, it's overbought(stochastic was over 90).  I thought sell $180 calls sould be the trade but you did the opposite trade and 100% correct.  Can you share your thought process?  TIA.

  185. StJ – I think Iflan was teasing you, why don't you suggest for him to trade NLY or AGNC?

  186. 3:00 PM On the hour: Dow -0.05%. 10-yr +0.08%. Euro -0.14% vs. dollar. Crude -1.12% to $96.52. Gold +0.73% to $1762.25.

    TrimTabs wads up and throws away the consensus estimate of economists that January's unemployment report will show 150K net positions were created during the month to keep the unemployment rate steady at 8.5%. Analysis by the firm of tax withholding reports points to a net gain of only a paltry 45K jobs during the period.

    U.S. home prices dropped 4.7% Y/Y in December and 1.4% M/M, CoreLogic reports. Excluding distressed sales, home prices dipped 0.9% Y/Y, but edged up 0.2% in the first M/M gain since July. "Until distressed sales in the market recede, we will see continued downward pressure on prices,” CoreLogic's Mark Fleming says.

    "Get out right now," writes John Taylor in an open letter to Greece. With 94% of its debt written under Greek law, the country has control – control it will lose once it signs a PSI deal. Introduce a new drachma at 50% of euro value – it will be ugly for awhile and BMWs will be very expensive, but tourism will boom and manufacturing will be profitable again. "Greece will be a country where it is possible to make a living."

    Tough new loss-provisioning rules from Madrid will have Spanish banks needing to raise €50B in capital this year. Lenders who present a merger plan by May's end will be given an additional year to raise their share. "It looks to me like a lot of stick and not very much carrot," says an analyst of the rules, which include upping loss assumptions for land from 31% to 80%.

    "In Tokyo, bankers and property brokers speak in amazed whispers of Chinese nationals paying for real estate with debit cards," relates Henny Sender, writing about the rising flow of capital out of the country. Not a new phenomenon, the flow is growing, thanks to political restiveness and ideas the yuan could fall in value just as easily as it has risen. 

    Oh we have GOT to go public and sell some bonds!  McDonald's (MCD) achieves a record-low rate for a 30-year bond as part of a two-part $750M bond sale; the 3.7% coupon easily beats the prior record-low 4.1% coupon for a similar borrowing by Alabama Power Co. last month. MCD last issued 30-year bonds in July 2010, when it paid 4.875%.

    Cigna's (CI -3.9%earnings fell 37% in Q4 amid acquisition-related charges and accounting changes, but the bigger weight on shares is the insurer's downward earnings guidance and rising use of medical services in the new year. Cigna expects 2012 EPS of $5-$5.40 vs. $5.68 consensus. Peers also are lower: AET -0.3%CVH-1.2%HUM -1.4%UNH -1.4%WLP -1.6%.

    Intuitive Surgical (ISRG +4.1%) pops after Collins Stewart (Buy) writes the Japanese Ministry of Health has indicated it willsupport the reimbursement of prostatectomies performed using Intuitive's da Vinci surgical robots, beginning in April. The firm also expects Intuitive and Japanese partner Johnson & Johnson (JNJ) to pursue reimbursement for other da Vinci procedures. (previously)

  187. BA/Msf – It just depends on if you have anything better to do with the margin than make $3 as it's pretty much a bird in the hand.  As it's so early in the year, I'd say the odds favor buying them back for a quick 70% and waiting for an opportunity to re-sell on a down move but that's me still being bearish – if the market goes up and up forever, the VIX will drop and it will be harder to make high-premium short put sales.  

    You're welcome Rip – Very nice example of how to improve your trading by NOT swinging for the fences.  

    Dollar hanging tough at 79.05 today.  Even now CNBC telling people jobs numbers will be 175K tomorrow – I think we're setting up for a big disappointment but then more unemployment means QE3…..  

  188. Tease / jerconn – Thanks, got that. I was actually going to suggest MSFT!

  189. StJ – Hey, MSFT been movin' and hoppin' lately, that might actually be a little exciting!


  190. FAS Strangle – Closed the 81 puts for a 40% win. At this point, we'll take anything! The 81 calls are of course the issue now! Maybe some help with jobs tomorrow!

  191. I just noticed that my $500 [!] of UNG is up over 7% today, CHK over 5%.  What did I miss?

  192. MSFT / Jerconn – It has (and actually they are looking good now), but I doubt that you would want to daytrade their options….

  193. Ah, but more employment means gold goes down…..'cause GLL sucks….and I am going to roll and DD….

  194.           Delcath Systems, Inc. (NASDAQ: DCTH) announced today that the first patients in Europe have been treated with the Delcath Hepatic CHEMOSAT® Delivery System at the European Institute of Oncology (Instituto Europeo di Oncologia – IEO), a premier cancer treatment and research center in Milan. The cases were treated as part of the initial launch and training agreement the Company announced with the IEO in November 2011.
    Two patients were treated for inoperable liver-dominant metastases from ocular melanoma and gastric cancer. All CHEMOSAT procedures were successfully completed without procedure-related complications. Delcath and the IEO will host a joint-press conference, on February 15, 2012 at the IEO, at which time an update on patient status will be presented.       

  195. Pharmboy,
    What do U think of BCS on VRTX now

  196. pharm,
    roll and DD now?

  197. VRTX – July 35/40 BCS, selling the 33s for 2.50 for a free trade and 20% off from here (roughly).

  198. yeah…kellen – 25c, although mine are not getting filled.

  199. Does anyone have the quote from the Fed about creating risk appetite and the unintended consequences?

  200. Nice — MM were messing around with VRTX options, cause I was putting in different orders and every one I put in they moved it 10-15c.  And something is up with VRTX….

  201. Closed right at the trend line as I said at 1.44 !! 8-)

  202. Phil – do you like holding long /DX here? Im long from 78.91 about a day or two ago…

  203. UNG/StJ – Slightly bigger drawdown than expected on inventory but mainly it's just a bit oversold (both CHK and UNG), which is why I picked them this morning.  

    DCTH/Msf – Is that saying they were cured?  Can't be –  just means the procedure didn't kill them.  



    STEVE LIESMAN: I've also had portfolio managers complain to me about the Federal Reserves saying, "You're forcing me into a risk profile I do not want to be in." How do you respond to that?

    CHARLES PLOSSER: Well, I think there's some cases where that's probably true. I've talked to money managers and financial managers and private equity people in the financial markets. And a lot of them do share the view that somehow in the stretch for yield many people are taking unwise risks. Now, of course the Fed has made it very clear that at times we're trying to force people to take some more risk, but we can't control how that happens.

    And so by trying to push people into riskier assets as we're trying to do with Operation Twist or with an Asset Purchase Programs, we don't know the full consequence with that. And we could, could-- I don't want to say we are, we could be breeding some problems for us down the road if we don't exit in the right time. And then we go past the exit and we have another credit bubble of some kind.

    Dollar/Jrom – I'd say yes over 78.85 it's a good risk but get the hell out if they fail.  Easier to just play up calls and not have all the risk when you sleep.  

    That was a crazy low-volume close – 114M total on the Dow, least of the week.  

  204. Dollar / Jrom – Keep in mind, jobs tomorrow morning. Could go either way and the dollar is usually impacted. I would be very careful!

  205. JRW – THis one – “These policies are still relatively unfamiliar to the public,” he said. “Consequently, their effects on the public’s inflation expectations, appetite for risk, and so forth are difficult to predict. This adds an element of uncertainty and raises concern about unintended consequences.” John Williams

  206. Today didn't close like the last 2. Only 2 big blocks in last minute but but 2 mininutes after the close some big numbers. Is this the new twist or is this the end of the run? Again we closed on that trend line, no it could never be a program. Can we lock up computers for inside trading? 100,000 4:11 PM WTF!

  207. bobhu./ 3:36 post/  You know, sometimes I can't really explain what takes me into a trade.  I study the charts, of course, but I'm not a highly sophisticated technical trader.  I just look at several things and draw a conclusion.   On AMZN I saw the markets rising, AMZN  rising, and put this together with the recent big drop in AMZN.   It's like something inside me says "This sucker is going up!".  And when I'm convinced, I pull the trigger.  Have you read the book "BLINK"?   It's sort of about how we draw conclusions, among other things.  Fascinating book that talks about intuition and the fact that intuition is just our subconscious telling us things that our conscious mind can't sort out and explain.   By the way, what the hell is a stochastic?     :)   

  208. UNG / Phil – Speaking of them, they were reset last year in March when they reached $5 and change. I am guessing it could happen again soon and the "old" options are going to become illiquid quickly! Basically, it can't be played a long trade I think. And like USO, they get hit by the contract rollover cost and all. Selling calls against it would have been a great strategy the last 3 years!

    Hard to believe that UNG was a $58 (split adjusted) in November 2008. We must be swimming in Nat Gas!

  209. I'm not sure if anyone would find this useful, but I have my account mentally segregated into 3 parts: 15% devoted to aggressive short term trading, looking for 100% returns or so, 20% devoted to longer-term 10%-15% returns, and the balance (65%) in cash and bonds where any return is nice, but safety is the goal here. I once had the "safe" portion down to 50%, but that's about as far as I go.
    This approach was designed for my precise circumstances – good asset base, no job (retired). It does not produce overly impressive total return on assets, but that doesn't matter.

  210. Sounds good Phil… Actually, I dont lose much sleep over it. Kabul is 9 1/2 hours ahead of you guys so it works out quite well. I try and go into my barracks for lunch 1230 our time and catch your 3 AM trades. So ive been here a month and developed a wicked cough… I just found out today why - we literally breathe sh!t here!    Besides the air and not trusting ANY afghani it isnt too bad here though…
    Thanks for the warning St Jean… Ill be careful…I just closed out my long calls of CSCO…Im have almost no stock now except some of Pharm's plays… Just trying to scalp some $$$ from Phil's daytrades, this market is ridiculous…

  211. Hoening for you JRW…

    The Glass-Steagall Act enforced the separation of risk-taking investment banks and deposit-holding commercial banks. The aspect of it that forced commercial and investment banks to split was repealed by the Gramm-Leach-Bliley Act of 1999, which was underpinned in part by the idea that allowing institutions to diversify would reduce risk.

    The repeal of Gramm-Leach-Bliley had intensified the concentration of risk in the largest institution, rather than reducing the risk they were exposed to, Hoenig said. "When Gramm-Leach-Bliley was passed in 1999, the five largest US banking organisations controlled $2.3 trillion in assets, or about 38% of all banking industry assets. Currently, Bank of America by itself and in spite of its need for government support during the crisis has the same level of assets – $2.3 trillion – as the top five did in 1999, and the top five have 52% of all banking industry assets."

  212. When folks around these parts stopped saying "Happy Groundhog Day" … :-)
    Non Sequitur   by Wiley Miller

  213. Phil/lflan/$100K
    I have been on this site for about 20 months now and have learnt a lot.
    One thing that consistently surprises me is how smart the members are and I am amazed everyday, both at Phil's morning posts, commentary and how he comes up with ideas for everyone ALL the time…and then Lflan goes and makes short work of a 50k portfolio.
    I am doing quite well trading Appl and a few select stocks, but mostly, I read every post and absorb.
    No, I do not want to necessarily turn 100k into 500k, but wondered, given the combined brain power on this site if something like that might be fun to play with….yes its a little bit of money, so how about a 5k portfolio into 25K in a year?
    But I do understand the logic behind small 'sure play' trades and thats what I do all the time myself….just looking for some benign excitement, and not looking to lose anyone's last shirt.
    BUt appreciate the sentiments expressed by all!

  214. 16:13 PM, 361,285 and 3,180,000 sell at 11 cents over ask in the same second! Plus lots of 4 figure numbers in blocks when during the day its 3 digit numbers, a few in the thousands. Who trades $29,610,000,000, thats billion, after the close?

  215. barfinger   // are you using the excess margin from your more conservative and cash portfolio parts  to trade with  in the aggressive part?  

  216. Damn, VRTX rocked it…..

  217. lflantheman/AMZN, great explaination, I need to read "BLANK" I guess.  I am basic a fundamental guy, I was thinking… AMZN missed, with over 100PE, up from $172 to almost $180 in two days and slowdown growth, so it should going down.  lol, stupid me.
    BTW,  stochastic or Stochastic Oscillator is a technical analysis that shows overbought/oversold, over 80 is overbought and below 20 is oversold(I hope I am correct on this one).
    Thanks again and have a great night.

  218. I have a lot of unused margin credit. Have not had to figure out where, exactly, it comes from.
    FWIW: we have had two "noticeable" down days this year, one down 4 points (SPX) and one down 6. I guess by those standards a flat day counts as a "pullback".

  219. My simplistic take on the repeal of Glass – Steagall is it gave the high leverage, high bonus, high roller brokerage crowd, access to the conservatively invested bank customers money. The high rollers just did what they do and when the dice came up wrong when the real estate bubble burst it was game over. 

  220. Hello all,
    Been away for awhile.
    Am I reading St Jeanluc's post on the apple virtual portfolio correctly?
    Started with 50k port, profit so far is 54,505, so total port balance is 104,505 ie a 100% gain?  If so, when was this portfolio started?

  221. jromeha – Sounds like my son is coming home soon. It seems I know more than he does given the amount of communication the military has with me – LOL. He told me that somebody said if you jog 5 miles over there it's like smoking 50 cigarettes. I told him to try and get the stink out of his clothes before he gets back.

  222. Ongba – Oh, about a month ago…

  223. so it is 100% gain in a month?  That is impressive!

  224. Well, maybe a little more than a month.  But not much more…ask Iflan

  225. ongba – lflantheman started the AAPL 50K portfolio on 12/6/2011.
    You can see the complete history at this link.

  226. yodi
    February 2nd, 2012 at 2:04 pm | PermalinkIgnore this user
    I live near Cancun Mex. Like to hear your opinion about Belize and where did you go in Belize?

  227. Grenowoods – it's really bad. I stay inside almost all day… I worst part is it is a little colder here (usually btw 15-35 all day) and one doesnt smell anything different in the cool, crisp air…You just start coughing badly after a few minutes. Im glad your son is coming home soon, hopefully he was able to save quite a bit over here.

  228. I had been short GMCR calls (jan13, 125s) on a 4th roll of a busted position last year. I bought them back yesterday, even though I was still confident they would expire in 11 months. My intention was to re-enter that short at the right time. Phil? do you have a feeling about where the current excitement will take them in the short term?

  229. I guess things are getting calmer…


    Below is a chart highlighting the 50-day average absolute daily % change for the S&P 500 going back to 2002.  Over the last 50 days, the index has averaged a daily change of +/-0.79%.  As shown, the reading has dropped by more than half from the high of 1.92% seen just a few months ago. 

    It's still crazy to look at this chart and see just how volatile things got back in late 2008/early 2009.  Last year's volatility, while rough, was nothing compared to what we saw during the financial crisis.  At one point in early December 2008, the S&P 500 had averaged a daily change of +/-4.02% over the prior 50 days, which is the highest level ever seen in the index's history.  With the entire US stock market swinging an average of 4% on a daily basis for more than two months, it's no wonder that individual investors are still having a tough time dipping their toes back in the water, even three years later.

  230. …certain there are more but a hundred sounds nice and round:
    Personal/Consumer Taxes & Fees

    1. Federal income tax
    2. State income tax
    3. Local income tax
    4. Employee social security tax (your employer pays the other half)
    5. Employee Medicare tax (your employer pays the other half)
    6. Property taxes
    7. Road toll charges
    8. State sales tax
    9. Driver's license renewal fee
    10. TV Cable/Satellite fees & taxes
    11. Federal telephone surtax, excise tax, and universal surcharge
    12. State telephone excise tax and surcharge
    13. Telephone minimum usage and recurring/nonrecurring charges tax
    14. Gas/electric bill fees & taxes
    15. Water/sewer fees & taxes
    16. Cigarette tax
    17. Alcohol tax
    18. Federal gasoline tax
    19. State gasoline tax
    20. Local gasoline tax
    21. Federal inheritance tax
    22. State inheritance tax
    23. Gift tax
    24. Bridge toll charges
    25. Marriage license
    26. Hunting license
    27. Fishing license
    28. Bike license fee
    29. Dog permit/license
    30. State park permit
    31. Watercraft registration & licensing fees
    32. Sports stadium tax
    33. Bike/nature trail permit
    34. Court case filing fee
    35. Retirement account early withdrawal penalty
    36. Individual health insurance mandate tax
    37. Hotel stay tax
    38. Plastic surgery surcharge
    39. Soda/fatty-food tax
    40. Air transportation tax
    41. Electronic transmission of tax return fees
    42. Passport application/renewal fee
    43. Luxury & gas-guzzler car taxes
    44. New car surcharge
    45. License plate and car ownership transfer taxes
    46. Yacht and luxury boat taxes
    47. Jewelry taxes & surcharges
    48. State/local school tax
    49. Recreational vehicle tax
    50. Special assessments for road repairs or construction
    51. Gun ownership permit
    52. Kiddie tax (IRS form 8615)
    53. Fuel gross receipts tax
    54. Waste Management tax
    55. Oil and gas assessment tax
    56. Use taxes (on out-of-state purchase)
    57. IRA rollover tax/withdrawal penalties
    58. Tax on non-qualified health saving account distributions
    59. Individual and small business surtax (page 336 of Obamacare)
    60. Estimated income tax underpayment penalty
    61. Alternative Minimum Tax on income
      Business Taxes & Fees
    62. Federal corporate income tax
    63. State corporate income tax
    64. Tax registration fee for new businesses
    65. Employer social security tax
    66. Employer Medicare tax
    67. Federal unemployment tax
    68. State unemployment tax
    69. Business registration renewal tax
    70. Worker's compensation tax
    71. Tax on imported/exported goods
    72. Oil storage/inspection fees
    73. Employer health insurance mandate tax
    74. Excise Tax on Charitable Hospitals (page 2001/Sec. 9007 of Obamacare)
    75. Tax on Innovator Drug Companies (Page 2010/Sec. 9008 of Obamacare)
    76. Tax on Medical Device Manufacturers (Page 2020/Sec. 9009 of Obamacare)
    77. Tax on Health Insurers (Page 2026/Sec. 9010 of Obamacare)
    78. Excise Tax on Comprehensive Health Insurance Plans, i.e. "Cadillac" plans
    79. Tax on indoor tanning services
    80. Utility users tax
    81. Internet transaction fee (passed in California; being considered in other states and at federal level)
    82. Professional license fee (accountants, lawyers, barbers, dentists, plumbers, etc.)
    83. Franchise business tax
    84. Tourism and concession license fee
    85. Wiring inspection fees
    86. Household employment tax
    87. Biodiesel fuel tax
    88. FDIC tax (insurance premium on bank deposits)
    89. Electronic waste recycling fee
    90. Hazardous material disposal fee
    91. Food & beverage license fee
    92. Estimated income tax underpayment penalty
    93. Building/construction permit
    94. Zoning permit
    95. Fire inspection fee
    96. Well permit tax
    97. Sales and Use tax seller's permit
    98. Commercial driver's license fee
    99. Bank ATM transaction tax
    100. Occupation taxes and fees (annual charges required for a host of professions)

    Wonder how many of these Germany has? Or Sweden? Norway? And other mostly homogenous countries.
    This like Gulliver being pinned down by a thousand Lilliputians.

  231. barfinger:GMCR
    I too am scaling back into short calls and I bet we don't have to roll all the way to 125 this time. They may not go too much lower, but also shouldn't repeat that crazy move up they did last year.  scaling and patient   FWIW

  232. Hi, barfinger,
    I remember that you play SPX strangles?  Are those trades considered as part of your short-term 15% portfolio?  They take lots of margins.

  233. GILD is on a tear….wow oh wow…..

  234. Flip
    VERY IMPRESSIVE… BUT, Very "depressing"…… looks like it's time to get out of Dodge… It's not going to change…..

  235. Pharmboy,
    Why is GILD up so much?  I got out of GILD at 40.  Of course, I have nothing to complain, as I got 50% profits after selling puts and covered calls for months.  But still, could have sold more puts…

  236. Taxes / Flip – Many if not all of these fees/taxes (and sometimes more – you have not listed the VAT which is not technically a sales tax as it is collected at every step and reimbursed later to business in one of the worst cases of bureaucracy lunacy I know) can be found in all the Western Europe countries. 
    And your list is a bit deceiving as some are fees meant to cover administrative expenses. But we get the gist… there are a lot of taxes. And I guess it takes a lot of work to manage, serve, protect and educate a country of 300 millions people. And also of course "save" the world!

  237. And Flip, there are few places in the OECD world where taxes are lower as a percentage of GDP than the USA. I guess there is always Australia. And these numbers are from 2009. Tax receipts have actually gone down as a percentage of GDP since then. And these number are all inclusive, not just income taxes!

  238. Phil,
    what are your thoughts about the NFP, and how the print may affect the equity indexes?
    there is also the B/D adjustment calculated into tomorrow's release, and Jan is historically a weak number, correct?
    i pulled up a 4 and 8 hour chart for the Dow and both have a H&S look with 12,750 (real) 12,700 (futures) putting up significant resistance since Jan 20th. the neckline at about 12,625ish (real) also converges with the still rising 50 MA .
    NFP the catalyst for a break higher or correction lower, odds?………….all opinions welcome……..weak number then justifaction for more FED stimulus and Bernanke seems to be making the case for it stressing riskd for growth at practically every opportunity ….
    also wondered about your thinking re the divergence with OIL as in US dollar down, OIL down and equities and commodity currencies AUD CAD NZD all up.
    the OIL  pretty much bounced off support at approx 95.50/75 along the bottom of the descending channel from 103.65.
    the thought that crossed my mind being if OIL can be manipulated up when it serves the purpose then by logic it can also be manipulated down to serve another purpose as in the FED being able to f/c an outlook for lower inflation, ie., point to a lower oil/gasoline price

  239. And while we are talking about taxes, I found this handy little chart:

    Back in the 1950s, when the top marginal tax rate was more than 90 percent, real annual growth averaged more than 4 percent. During the last eight years, when the top marginal rate was just 35 percent, real growth was less than half that. Altogether, in years when the top marginal rate was lower than 39.6 percent — the top rate during the 1990s — annual real growth averaged 2.1 percent. In years when the rate was 39.6 percent or higher, real growth averaged 3.8 percent. The pattern is the same regardless of threshold. Take 50 percent, for example. Growth in years when the tax rate was less than 50 percent averaged 2.7 percent. In years with tax rates at or more than 50 percent, growth was 3.7 percent.

    Oh well, so much for what we hear these days!

  240. NFP / Roro – I was trying to go back and see what we did on job releases the last couple of months but I don't have the dates! I think that there are a couple of factors at play now:

    1. This market is in such a upward trend that it seems difficult to stop it. Momentum is hard to fight!
    2. As Phil mentioned, bad numbers = more QE and good numbers = good numbers. So no way to lose there!
    3. On the other hand, this has been relentless since the open on 12/20 (SPX is up 125 points or more than 10%) and possibly some big players are looking for an opportunity to cash these profits. 

    So we shall see….

  241. thanks for your input stjeanluc……….i was thinking more or less along the same lines and although there is the appearance of a HS formation on the 4 and 8 hr charts the MAs are all very clearly in upward slopes.
    on the day charts i use 2 standard deviation for BB settings (so 4 channels) and the NAS100 has NOT been outside of the upper channel since the gap up open on jan 3………pretty much the same for the Dow and the S&P with exception of monday and tuesday when there was some selling.
    same for the Australian dollar, and the DAX

  242. I've had it with what the "market expects" from the Fed!  THERE WILL BE LOW RATES AND QE FOREVER!!!!  Why is any of this a surprise???  How many times will CNBC act surprised when a clown pops out of the same box when the same lever is cranked?!?!?
    There will ALWAYS be another excuse for "accommodation".  So let's get busy pricing in years of malinvestment and the status quo being protected over any other consideration… no matter how stupid and corrupt it is.
    I'm sick of it.

  243. yodi
    February 2nd, 2012 at 2:04 pm | PermalinkIgnore this user
    I live near Cancun Mex. Like to hear your opinion about Belize and where did you go in Belize?
    Hi you so busy with your taxes Like to know what you think about Belize if you still on line thanks

  244. Charts / Roro – Here is a chart I have of a regression channel on SPX with 2 standard deviations plotted. This ones goes back 200 days. It could be read multiple ways obviously. But we are clearly approaching the upper channel now! 

    Going back 500 days, we have a different picture:

    And using a 3rd order Polynomial fit over 500 days with the same 2 standard deviation channel, here is what get…

    Tough to tell where we are going now….

  245. StJ,
    You are truly impressive! 3rd order polynomial!?  Which software or web site did you use to get those charts?

  246. four-week average volume on the NYSE has dropped to levels not seen since, yes you guessed it, 1999.
    (graph in link) – I think even the HFT's are getting lonely . . .

  247. BSX
    I recommend against. 
    Yes, 5 bucks sounds cheap, but look at the financials . And the Management (if there is any). They've lost something like 8$B in what, 6 years? That's a crude guess and could be way off, I merely glanced at the numbers for 20 seconds earlier today after seeing one or two people here mention the company. For old time's sake I went back and took a few seconds to look at the last few years results. I was curious how a $55 stock becomes a $5 stock. That takes skill. I might be off on the $55 part, I'm going from memory at the time of the merger, and I don't see anyplace to quickly find a stock chart of the period, going back that far, around 1996.
    I was 7 years as an Engineering R+D Technician with Scimed Life Systems, Maple Grove Minnesota, in the early to mid '90's. Best company I ever worked for in my entire life. The leadership, the integrity, the "team" feeling, the massive growth rate, and the fact that my own career spurted faster than at any other time………I'll remember it forever. You'll find me on patent #5382234. I started working there as a temporary assembler, through a "work to hire" type temp place, $6.00 an hour. I left 7 years later as a Senior Engineering Technician and Lab Instructor for new technicians, with my name on a patent. They were just starting to nibble around the edges to see if I could handle any type of informal leadership position, I think. I had reached the top of the Technician Pay scale, so they had to create something new to slot me in.
    Leaving was a minor mistake…….I should have stayed about another year or so…..I left to go to a start-up med company locally here, which flamed out, and was for me a personal disaster……..long story. On the other hand, if I had not left, I never would have gotten into the next phase of my career, as the Macintosh Systems Administrator for a publishing company (the second greatest job I ever had-and which paid a lot more :) .
    I worked harder there than any other job I've ever had. I don't mean they pushed me, they did. But 98% of it was me pushing myself. MANY long hours. But it was awesome. If you want to have some fun, go back (if you can find it, might not be easy) and look at the share price for SMLS from the late 1980's through the time that Boston Scientific bought them (I think around 1996?). That's a chart of beauty.
    When you read the books and the articles about the valley start-ups of the 70's and 80's, that is what Scimed was here, locally. That FEEL, that Excitement. Everybody working together, everybody helping each other. We got a lot of investors because they would come and visit the campus and they could feel the energy, the fact that nearly everybody they saw was smiling and happy. The Scimed leadership team went out of their way to treat EVERYBODY at the company as being a critical asset. We had clean room's full of people making $6.50 an hour, doing micro-bonding of catheters. If even one of those bonds, or the other manufacturing steps were performed improperly, it meant somebody's life was at risk while they laid on the table during an angioplasty procedure. And you have to train them very , very well to concentrate on quality beyond any other consideration. So, you have to keep all those assemblers very happy. And Scimed did. Pizza practically weekly. Christmas parties. Exec management doing rap songs dressed as rastafarians in body paint. God, it brings back memories. I feel like laughing AND crying. Very important time in my life. Sorry to get personal and off the topic…….I guess you can feel that I was pretty passionate about it…..the reason I bring all this up is to contrast what happened after Boston Scientific came onto the scene. What I'm describing is not something you'll ever see or learn by reading the Analyst Reports, or the business press of the time. This is what is was REALLY like.
    I used to work in the lab into the evening hours, and I would always catch the business report, and many nights they would report new highs (shares). And I'd be sitting there in the lab, saying "It's ME, It's ME"…………What song is that from?…..oh yeah, one of Patti Smith's…….Birdland…."I'll go up, I'll go up, go up,go go up, up, up up, up, up…….
    Funny-I thought of the "It's ME" bit because I used to be sitting in the lab building prototypes with the Rock and Roll cranking (I convinced management to buy a wall shattering stereo for the lab – 4 foot JBL's) while listening to the business press talking about us. But the rest of the lyrics fit as well.  Weird, but cool.
    There were several of us who would often still be working at 8pm or later. The engineer's offices were on the other side of the wall from the R+D lab. One night we had the walls shaking with the music pounding out. The next day one engineer who happened to be there that late (very rare) complained to the R+D VP about the noise. The VP basically told him "if you've got Techs who are working until 8pm of their own volition, and it takes loud music to keep 'em happy, then that's how it's going to be".
    Back to Boston Scientific. They bought Scimed, and ruined it. What Dale Spencer and the others there built was slowly but inexorably folded into the stuffed shirt blue blood bull crap that was Boston Scientific. Just before the merger (takeover was more like it), a few of the managers from Boston came to check us out, and I just totally got the creeps from all of them. VERY cold and icy, just the exact opposite of what we were all about. I knew then for sure what everybody had been saying, that once Boston took us over, that things would go downhill fast, was true. They did. Fortunately I got out not long after that.
    Scimed was the only coronary angioplasty company (Cordis, ACS, Bard, etc) to never have had any significant quality issues with it's products. All the other companies did.  I'm damn proud of that, personally. I'm also very proud that I spent 7 years of my life helping develop products that were designed to, and did, literally save peoples lives. All the other angioplasty company's had periods of very significant quality issues, and it did not take long for Scimed to get dragged into the same laundry hamper, once BSX had them. For years after wards I was hearing business press stories of the product quality issues at their coronary angio division. So sad.
    I went back to visit about 5 years ago, and Oh My God……what a nightmare. None of the old heroes were there.
    Anyway, I guess BSX looks attractive to some people, at this price. I looked at them when I started trading a couple years ago, and couldn't believe my eyes. Boston Scientific is a $5 stock? What the hell happened? So, I don't know what the poster's intent above was, Short term trading, Options, longer term investment, etc.
    But I don't see much margin of safety in owning outright long shares. The founders of BSX cashed out over the last couple years, I think. They were literally Billionaires (Abele and Nicholas). If I remember correctly, the President of Scimed, Dale Spencer, had about 50 Million dollars of stock when he left the company. Not bad. And he is one of the very rare mega rich that I would say deserved it. So what did he do, at the age of probably 58 or 60, with 50 mil in the bank? Go start a bunch of new ventures, of course. I personally would have gone fishing, but he was the most driven man I've ever known.
    If you want to buy BSX, go ahead, but I'm trying to put a human face on a tradable security for ya all.
    Sorry for the long post, but I thought I'd throw in my few cents about one of the rare things  here that  I know anything about. On the other hand, I've only been here three days, so we'll see.

  248. Chart / Cwan – Amibroker with some customs charts.

    Speaking of charts, here is another bullish one…

    And yet another one…

    For what it's worth!

  249. I think Bespoke has something about NFP days as well  if opens up the highs are early in the day and if opens down the highs are end of day , however in this market the unexpected should now be expected.

  250. Newbie: Nice story, very interesting.  The ending made me smile.   I, too, cashed out of my last company, one of nearly a dozen I founded, in my middle age.  I would unequivocally consider myself driven, but also have a low boredom threshold and dislike repeating myself.  I was persuaded to try something really different that I had never considered — raising children. Hardest and most challenging damned job I've ever had — but it pays at least as well, if you can adapt to a new unit of measurement!

  251. Government charts are usually biased. Phil has been playing the pre market. for some time. Now the big action is post market instead or also. Why is this happening? I can't think of one good answer. There is a reason.

  252. Ditto on the raising children.  hardest job I ever had, or should I say undertaking; but by far the most rewarding.

  253. zero
    thanks-i don't have children, probably too old now-i can barely take care of myself-i don't know how people do it, but yeah, i've heard this same sort of thing before-hardest "job" but very rewarding

  254. newbie
    Your not the only one who never had children. I liked your long post, reminded me of times when we made a difference. I spent years working long hours at a few companies that today I would rather not admit to. It is such a shame that this has happened everywhere. The only good companies do most work off shore. The problem was incentive went away, people had no value, all became disposable, and it was less expensive to do it over there. What will bring it back? Start by ending free trade, then free profit, and last get rid of the people that live here but think the only thing that matters is being the richest dead man. They just don't understand you can't take it with you!

  255. Phil
    What platform do you recommend for futures trading and what would be reasonable trade commissions? Also, thanks for your great comments last night on futures trading.

  256. Good morning!

    Dollar took a dip back to 79 but bounced there and back to 79.10 now.  I think they make another run at 78.85 before giving up – probably trying to catch BOJ asleep once the Nikkei closes.  Yen now at 76.18 with 76 being the theoretical line in the sand for the BOJ.  Pound is up today at $1.5836 but Euro just $1.3141 and EUR/CHF at $1.2051. 

    1:59 AM Asian markets are mixed in choppy trade. Japan -0.5% to 8831. Hong Kong -0.1% to 20730. China +0.7% to 2330. India +0.1% to 17440

    Gold is still $1,761 and oil is $96.45, pretty much drifting along since the close.  Silver is $34.22, copper $3.80, nat gas $2.52 and gasoline $2.87 all drifting flat so we may be looking at pins into the weekend already except, of course, for the very exciting NFP numbers at 8:30.  

    At the close: Dow 0-08% to 12706. S&P +0.28% to 1328. Nasdaq +0.40% to 2859.

    Treasurys: 30-year -0.06%. 10-yr +0.08%. 5-yr +0.02%.

    Commodities: Crude -1% to $96.63. Gold +0.69% to $1761.65.

    Currencies: Euro -0.1% vs. dollar. Yen -0.03%. Pound +0.18%.

    Market recap: Stocks ended mixed in lackluster trading following a mixed bag of earnings reports and ahead of the monthly U.S. employment report. Among key S&P sectors, banks and energy ended higher, while materials slipped. Facebook's IPO filing sent social media shares soaring. Oil fell to six-week lows on supply and demand woes. NYSE gainers led losers three to two.

    Friday's economic calendar:

    6:00 Monster Employment Index

    8:30 Nonfarm payrolls

    10:00 Factory Orders

    10:00 ISM Non-Manufacturing Index 

    Notable earnings before Friday's open: AONAXLCLX,ELSPGTSNCLXELSPGTSNWY 

    Still talkin' up the markets at Goldman:  While there are still plenty of risks to an economic recovery, the start of 2012 is nothing like the 2008-2009 crisis, observes Goldman's Jim O'Neill. One third of the euro zone that’s supposedly falling apart is actually improving, and China appears close to a soft landing. "The evidence from all over the place is that it’s nothing like '08."

    Party like it's 1999:  Dividend investing still has supporters among the prudent (I,IIIII), but more investors have been looking for greener pastures so far in 2012. Non-dividend-paying stocks on the S&P jumped 8.3% in January, while dividend payers fell 1.3% after spiking 10.4% in 2011. "We're seeing rotation into pure growth today," Cabot's Rob Lutts says.

    With corporate earnings a bit lackluster, a new worry is surfacing: profit margins, which stand at 8.23% midway through earnings season, down from the previous two quarters. “The direction of unit labor costs and commodity prices are so key from here in sustaining the profit growth that investors have become accustomed to over the past few years,”  says Miller Tabak's Peter Boockvar.

    "Investors may be inadvertently taking risks that they do not understand or that are inadequately disclosed," says Finra, worried about yield-chasing in an environment where Treasurys offer barely visible yields. Among the questionable products being pushed are non-traded REITs, leveraged ETFs with synthetic derivatives, variable annuities, and life settlements.

    The Reserve Bank of India will cut rates once it's confident inflation is slowing, says Deputy Governnor Subir Gokarn. "The stance now is that we have reached the peak and any further action will be toward easing."

    China is considering deeper involvement in the eurozone's bailout funds, China's Wen Jiabao said yesterday, but he stopped short of offering any firm commitments. It's the strongest public indication to date that China may tap some of its massive forex reserves to aid the eurozone.

    The worsening Greek economy means the country will need an additional €15B (on top of the €130B bailout), says an EU official. The EU/IMF calculates the country needs to bring its GDP/debt level to 120% for a sustainable situation. Unexplained is how piling on additional debt (which is what the €15B would be) accomplishes that. "Get out right now."  "Get out right now," writes John Taylor in an open letter to Greece. With 94% of its debt written under Greek law, the country has control – control it will lose once it signs a PSI deal. Introduce a new drachma at 50% of euro value – it will be ugly for awhile and BMWs will be very expensive, but tourism will boom and manufacturing will be profitable again. "Greece will be a country where it is possible to make a living."

    The Justice Department indicts Swiss private bank Wegelin on charges it enabled wealthy Americans to evade taxes on at least $1.2B hidden in offshore bank accounts. It's the first time an overseas bank has been indicted by the U.S. for enabling tax fraud by American taxpayers. (previously

    Banks have been steadily releasing reserves against bad loans, which has boosted their earnings reports. But with loan-loss cushions now heading back to pre-crisis levels, some analysts believe banks will have to slow reserve releases, adding pressure to profitsalready hit by slower growth and tighter rules.

    Tim Geithner warns against easing up on efforts to set stronger financial sector rules for fear that gains already made will be lost, and says key elements of reform will be coming in 2012, including making non-bank institutions such as hedge funds and insurance companies subject to the same financial regulations. 

    Investors looking for ways to play the Facebook (FB) IPO have taken shares of GSV Capital (GSVC) on a tear, up over 32% during the past seven trading sessions. The San Francisco-based business-development company invests in many of the biggest names in technology before they go public. Facebook, Twitter and Zynga (ZNGA) are among its impressive roster, and snapped up when their IPOs were nothing more than rumor.

  257. I''m not actually awake, just got up to see if anything interesting is happening and it isn't…

    So, later! 

  258. stjeanluc and jomayo……….thanks again for the inputs. always smart to look at the same thing from different angles.
    this boring steady march up structure which seems to fly in the face of common sense and fundamentals is more or less identical to the periods from;
    - 02/08/10 to 04/26/10 and then the flash crash
    - 08/31/10 to 11/08/10 and then a consolidation
    - 03/01/12 gap up day to start the year and has not looked back
    when the reversals come off these un-natural advancing structures the turns have been hard and violent, and then another intervention to stabalize and correct back higher
    The Dow was at 11,800 mid to late August 2008 down from 13,000 mid May 2008 up from 11,800 mid Amrch same yr and down form the H&S peaks of 14,150 and 13,500 from late 2007.
    13,000 looks like the next target up if that is the number our central planners want next
    Europe looks so calm ahead of today's print……….not a care in the world.
    peedlew……weren't you trying to short this thing only a few weeks back or am i mistaken about that?

  259. 2,500 in Nas futures (/NQ) seems like a good shorting line ahead of the bell. That's lining up with 1,325 on S&P, 12,688 on the Dow and 813 on the RUT with the Dollar at 78.99 so of course we're looking for the Dollar to go over 79 and the Nas to pull back and abort if not.  

  260. I remember the last time we had a long slow grind up with low volume it cost me ALOT of money because I was short the whole way up saying the fundamentals don't support this move, but it kept going up and it can go up longer than I had  /have funds to fight it. I am 60/40 bear leaning and if it doesn't flip today I'm going to have to flip.  

  261. Oil $96.71 and we missed a test and failure at $97 or I would have liked that too.  

  262. Many things amaze me about this board.  But a new one is how folks can continue to talk about the same things over and over.  Perusing the comments here it sounds exactly like it did during the last QE driven rally.  No one, including myself, could believe it was happening.  Volume was low and indices defied gravity/logic.  In USAToday they had an article on Bernanke's testimony to congress.  The headline was Bernanke warns against cutting deficit too quickly.  The last line of the article was many economists believe a new round of quantitative easing will be announced at the Fed's next meeting in March.  A U Penn dean at Warton was saying stocks were in some ways at historically low levels.  Yesterday really felt like Groundhog Day.. the movie.  Everyone is working together to try and sell people on this thing.  Whether we recognize it or not we've seen it all before.  There is no fighting it.  Just turn off your brain. 
    Phil / JRW / Pharm or anyone else with pic posting powers I suggest capturing the image from the link below and posting everyday to help as a reminder:

  263. Daily Mail reports this morning on a research study of 15,000 Brits over several decades that found (shockingly) that  conservatives are less intelligent that liberals. Sorry can't post the link on crappy hotel computer.
    Next up--which are more intelligent sheep vs dogs, premium sellers vs premium buyers?

  264. 79.00 looks like a critical support/resistance number for the Dollar Index. back to March 2011………about half way between the high and low for that period.

  265. matt.………i agree, and this is the 3rd time since the market bottomed in Mar 2009.
    the second one came Aug 31 2010 and it was tipped with a buy of several hundred thousand ES contracts at the close that day. i was just smart enough to close shorts but not smart enough to realize it was also a signal to get long big.
    live and learn i guess, or at least try……..

  266. Essentially, it was  just what we expected, the Dollar got jammed back down to 78.90 but held that line and now we're getting a bit of a bounce (but not much so far). 

    7:00 AM On the hour: S&P +0.14%. 10-yr +0.05%. Euro +0.11% vs. dollar. Crude +0.19% to $96.55. Gold 0% to $1759.35. 

    4-Wk Avg NYSE Volume Lowest Since 1999. (graph)

    Jan. Monster Employment Index: -7 to 140, -5% on a monthly basis which reflects a seasonal lull and market conditions. The index is +9% on an annual basis. 

    Eurozone December retail sales  fell 0.4% in December, missing expectations for a 0.2% increase. Sales were down 1.6% Y/Y against expectations for a decline of 1.3%.

    Oil Price Could Fall to $70 in 2012 Amid Volatility, Shell WarnsOil prices could fall to $70 a barrel during 2012, from current levels above $110, as high volatility in the economy and energy markets becomes "a fact of life", Royal Dutch Shell executives said.

    Morgan Stanley(MS) Cuts EURUSD Forecast From 1.20 To 1.15 On Upcoming ECB Easing.

    Europe's "Great Deleveraging" Has Only Just Begun. (graph)

    Greece Aiming to Close Swap in Second Bailout Faces Fight to Stay in EuroGreece’s fight to win its second international bailout may only open a new chapter in its struggle to remain in the euro area. The rescue plan, which European officials and Greek creditors say may be wrapped up in coming days, includes a loss of more than 70 percent for bondholders in a voluntary exchange and loans likely to exceed the 130 billion euros ($171 billion) now on the table. That won’t stanch the bleeding, say economists including Holger Schmieding of Berenberg Bank in London. Greece will be saddled with too much debt, too little growth and too large a budget hole to do without even more money that euro nations led by Germany are increasingly reluctant to offer, they say. “Greece is in deep trouble,” Schmieding said in a Jan. 30 report. “The current Greek adjustment program is failing. Excessive austerity, a lack of supply-side reforms, administrative incompetence and political deadlock have pushed the Greek economy into an apparent death spiral. More of the same will not work.” As Greek officials negotiate with representatives of the so-called troika — the European Commission, European Central Bank and International Monetary Fund — Deutsche Bank AG Chief Executive Officer Josef Ackermann may travel to Athens this weekend for talks over a swap involving Greek debt with a face value of about 200 billion euros.

    Polls Show President’s Message On Tax Fairness Popular, But Jobs Still Key (TPM)

    Global Strategists Abandoning Bearish Views (Bloomberg)

    Life – and Death Proposition (Pimco)

    Fisher Calls Fed's Target Forecasts Misguided 'Guesswork'Federal Reserve Bank of Dallas President Richard Fisher described policy makers’ forecasts for the central bank’s main interest rate as little more than speculation. “These are not binding commitments,” Fisher said today in a speech in Austin, Texas. Fed officials’ projections for the economy and interest rates are “largely guesswork, especially looking out over a multiyear period.”

    Why We Got Ayn Rand Instead of FDR: Thomas Frank on How Tea Party ‘Populism’ Derailed aNew New Deal (AlterNet)

    Why the Early U.S. Didn’t Go the Way of the Euro (Bloomberg)

    Kyle Bass Urges Texas Fund to Hold Gold Hedge as Assets Shrink. Kyle Bass, the Dallas hedge-fund manager, urged overseers of Texas’s state university endowment, the second-largest U.S. college fund, to stick with a $1 billion investment in gold bullion even as the fund’s assets decline. “I’m against selling any of the gold,” Bass said today at a meeting of fund directors in Austin, citing the need for a hedge against mounting risks driven by government deficits in the U.S. and Europe. “As every day goes by, I see deflation in the things you own and inflation in the things you need.

    Another Japanese exporter bites the dust:  Panasonic (PC) reports a ¥197.6B ($2.6B) net loss for the Oct.-Dec. quarter, and expects its full year results to be its worst ever at a projected loss of ¥780B. Contributing factors: a strong yen, production problems related to Thai flooding, costs from its absorption of Sanyo, a global slowdown, and eurozone-driven instability in financial markets.

    Japan Inc. Suppliers Cut Jobs as Yen Batters TV, Chip Profit. Japan Inc. is suffering and the supply chain is bearing the cost. The yen's 7 percent surge against the dollar in the past 12 months has widened losses at Sony, Mazda and Sharp Corp., which plans to halve TV production at its biggest factory to reduce inventory. Manufacturers have been forced to both relocate production outside of Japan and to press their suppliers for cost cuts.

    The Paradox of China Prosperity (Economist

    China Economy Heading for ‘Hard Landing’ as Exports Falter (Bloomberg)

    Wynn Macau Profit Misses Analysts' Estimates on CompetitionWynn Macau Ltd., the Hong Kong-listed casino unit of Wynn Resorts Ltd.(WYNN), missed analysts estimates for its full-year profit on rising competition in the world’s largest gambling hub

    China should prevent using wealth accumulated to overspend on luxury goods, according to a commentary published on the People's Daily today written by Jiang Hongbing.

    Europe is stuck on life support (

    Surrender and extend and pretend is your reward:  Spanish banks that agree to merge by May could get two years to make provisions against troubled real-estate assets rather than just a year. The merged firms would also be able to tap the state’s bank-bailout facility for funds. In total, the government's tough new rules will force Spanish banks to raise €50B in capital. (previous)

    Getting back to the gold standard (MarketWatch)

    Yay, we're getting away with it!  Bank of America (BACwins a dismissal in a lawsuit filed by Allstate (ALL) over losses incurred from mortgage-backed securities purchased from BofA-acquired Countrywide Financial. The judge's ruling allows Allstate to refile a narrower case, but it gives BofA a stronger position if settlement negotiations commence.

    Not getting away with it – the Gang of 12:  Switzerland is investigating a dozen U.S., European and Japanese banks suspected of conspiring to manipulate interbank lending rates. Banks under investigation include Citigroup (C), Credit Suisse (CS), Deutsche Bank (DB), HSBC (HBC), JPMorgan (JPM), UBS (UBS) and RBS (RBS). 

    Banks Join Pensions in Squeeze as Federal Reserve's Low Rates Erode ProfitThe Federal Reserve, which cut its target for the federal funds rate to a zero-to-0.25 percent range on Dec. 16, 2008, said last month that rates would remain “exceptionally low” at least through late 2014. While the unprecedented period of near-zero rates is meant to aid an ailing economy, it poses challenges for banks, insurers, pension funds, and savers. The hope is that by making mortgages and other loans cheaper, ultra-low rates eventually may revive economic growth, Bloomberg Businessweek reports in its Feb. 6 issue. For now they’re squeezing profits at banks and disrupting investment strategies at insurance companies and pension funds. They’ve reduced payouts on savings accounts and bonds, and may lead to higher bank fees and insurance premiums. “For most people, there’s been more downside to these low rates than upside,” says Barry Ritholtz, chief executive officer of FusionIQ, a New York-based investment research firm. “They’ve punished savers and people living on fixed income, and made insurance more expensive.”

    It's been a long time in coming, but yesterday the Senate voted 96-3 to pass the Stop Trading On Congressional Knowledge Act, or Stock Act, which will ban legislators from trading shares based on insider information they pick up in Capitol Hill. The bill now goes to the House for a vote next week. 

    Kass: A Contrarian’s Dream (The Street)

    Teens: More multimedia = less happy and less socially comfortable (The Wirecutter)

    Supercharge Your Creativity by Rebooting Your Morning Routine (LifeHacker)


  267. Matt/Deja Vu

    Nice to see you posting again.
    You're absolutely right.  This is identical to last years and the year before manipulated rally's.  No volume….steady climb upward. 
    It's funny watching the how the Bots work.  They are methodical.  BTFD's.

  268. Conservatives/JMM – Well unfortunately Neanderthals were smarter than Cro-Magnons too but the Cro-Magnons were more willing to bash skulls in with tools and went on to dominate the gene pool. 

    Backed the wrong futures horse (or maybe BECAUSE we backed it) but Nas is only index not falling off.  Oil down to $96.14 now and even gold failed $1,760. 

  269. Phil……….OIL testing that descending channel support  95.50ish so if it breaks lower there is another channel under it with a support line all the way down at around 87/87.50.
    the technicals look OB on a day chart…….CCI all the way down at -190 and last 2 times that indicator was this low there were rallies

  270.  Yep. Not really a fun time for premium sellers, so nice time to pursue hobbies, focus on work, smell a rose etc..

  271. Wow. Were the job numbers that good?

  272. roro/CCI
    My chart has CCI @ +102, (not -190) indicating a possible OB sell-off historically.