9.1 C
New York
Saturday, November 26, 2022

Subscribe

Monday – “Markets in Turmoil” According to CNBC – Must be Time to Buy!

What a fantastic contrary indicator!

CNBC hit the panic button this weekend with their "Markets in Turmoil" special report where they trot out their crisis team of Jim Cramer and Maria Bartiromo in an attempt to stampede all the remaining sheeple out of the markets on Monday Morning (see our Friday morning post for our view on why we thought Friday's drop was going to be a bear trap).

"An awful May is replaced by the start of a frightening June" is CNBC's opening voice over and it gets dumber and dumber from there as "America's Financial News Network" bangs the fear drum right at Asia's open (9pm) and then uses the panic in Asia to prove their point to EU and US traders that there's something to worry about.  

I could go on and on about how ridiculously evil this network is and how horrible it is that we allow these Financial propaganda networks to manipulate the markets to the benefit of the highest bidder but, in the long run – who cares?  If you watch CNBC and take it seriously – just like people who watch Fox to find out what's going on in the World – you reap what crap you have sown.  

SPY DAILYWe are not, in any way, gung-ho bullish but we're also not going to play bearish.  On the whole, as we reviewed in this week's Stock World Weekly (available free this week!) – we are "wishy washy" in our positions, cashy and cautious and doing just a bit of bottom-fishing as we HOPE (not a valid investing strategy) that this is the bottom as we HOPE the G8 takes some rational action.

We made a bullish play on the Futures at 9:13 last night, while CNBC was clearing out all the suckers at Dow (/YM) 12,000 but we took that money and ran as we popped over 12,075 (up $375 per contract) early this morning and flipped to a bullish play on oil (/CL) off the $82 line and those contracts are already $82.40 – up $400 per contract at 8am.  

We were also very excited to see AAPL back at our buy point of $555 early this morning as AAPL is pure rocket fuel for the Nasdaq when it bounces and AAPL can move quickly back to $580 on any hint of good news and that's a 4.5% move up that should be good for a 2-3% pop in the Nasdaq – maybe more if the SOX stop dying for a day or two! 

So thank you CNBC for being the blatantly manipulative joke of a network you are – we continue to make bank betting against you on a regular basis – just like the people who pull your strings…  As we often say at PWS – "We don't care IF the game is rigged, as long as we can figure out HOW the game is rigged and place our bets accordingly."  

During Friday's excitement (over 300 comments in Friday's Member Chat) we played both sides of the fence but had aggressively long trade ideas for TLT (short at $130.36) as well as spreads on TQQQ ($41.96) and XLF ($13.50) – playing for the pop we anticipated this morning.  We'll see how those go before we get all excited but our small, virtual portfolios are very bullish while our brand new Income Portfolio has a virtual $500,000 ready to deploy on the bull side as soon as we confirm that the World is not going to end (at least before December 21st).  

See my comments on "The Week Ahead" in Stock World Weekly as well as our chart of the action this week, which includes Euro-Zone GDP and mucho Fed speak although this morning Cleveland's Pianalto said: "The seasonal adjustment process could be behind the strong January and February prints and May's weak one, she says, but taken together they continue to give a picture of a slowly growing economy that needs no further stimulus."

Nonetheless, GS says: "Our confidence that the FOMC will ease policy once more at the June 19-20 meeting has also grown," and they see the Fed committing to purchases of MBS and Treasurys – "considerably more powerful than an extension of Operation Twist."  Of course listening to GS is almost as bad for your portfolio as sticking with Cramer but the trick to GS is figuring out where they are in their own commitments and this is an early statement that's probably an accurate take on the Fed, rather than a manipulative attempt to scare people out of bearish positions (so they can get more for themselves, of course).

Now it's 9:15 and oil is touching $83.40 and our Egg McMuffins are paid for (up $1,400 per contract and thrilled to take it and run!) so we really don't care what the market does this morning as we're wishy-washy with bets on both sides and cashy enough not to care which side wins but, for the sake of the well-being of the Global Economy – we are kind of rooting for the bulls this week!  

It's going to be a very exciting week but it's ALL about Europe, not our own Fed.  There will be many, many rumors but we need ACTION from the ECB, IMF, EU, BOJ, PBOC, BOE and the Fed in order to reverse this bearish trend – words just aren't going to do it for us anymore so, while we REALLY want to be bullish down here – we still need Mr. Market to show us the levels – starting with 1,284 on the S&P and 2,757 on the Nasdaq – the 200 dmas that MUST be taken back in order for us to get comfortable riding that bull again.  

182 COMMENTS

Subscribe
Notify of
182 Comments
Inline Feedbacks
View all comments

FWIW – CHK triggers catch play
 
CHK hit a 52-week low of $13.32 on May 17 before bouncing back a bit in the last three weeks of trading. After selling off with the market on Friday, the stock found support at its 21-day moving average this morning, signaling a “Catch Play” entry .  The 21-day MA is starting to flatten out after several months of a steady downtrend, another bullish sign for the stock. The next level to watch for momentum is Thursday’s pivot high at $17.13.
 
http://www.t3live.com/articles/market-analysis/3090-chesapeake-chk-triggers-a-qcatch-playq-after-decision-to-replace-key-personnel.html

dpas / RSS  – No, no luck.  I sent Greg a email asking for specific, step by step instructions on how to get RSSOwl to work.  Fingers crossed.

And Tim Rice sounds like Phil talking about the market!!  http://news.bbc.co.uk/2/hi/programmes/hardtalk/9725469.stm

Now that's a BS stick, but expected non-the-less.  ZLCS and CLDX were green…oh, and SGEN. 

RSS / Bur – ok, please if Greg comes back to you, forward me his instructions, you have my mail. Take care!

Burr/RSS — please share with the board, I'd love to get mine working again also. I love RSSowl, but I'm willing to look at another client. I don't see any way to log in through the client, though. I assumed it worked through the browser login, but in hindsight that doesn't really make sense. I'm guessing that's the crux of the problem. Let me know if I can help in any way. 

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

/* Style Definitions */
table.MsoNormalTable
{mso-style-name:”Table Normal”;
mso-tstyle-rowband-size:0;
mso-tstyle-colband-size:0;
mso-style-noshow:yes;
mso-style-priority:99;
mso-style-qformat:yes;
mso-style-parent:””;
mso-padding-alt:0in 5.4pt 0in 5.4pt;
mso-para-margin-top:0in;
mso-para-margin-right:0in;
mso-para-margin-bottom:10.0pt;
mso-para-margin-left:0in;
line-height:115%;
mso-pagination:widow-orphan;
font-size:11.0pt;
font-family:”Calibri”,”sans-serif”;
mso-ascii-font-family:Calibri;
mso-ascii-theme-font:minor-latin;
mso-fareast-font-family:”Times New Roman”;
mso-fareast-theme-font:minor-fareast;
mso-hansi-font-family:Calibri;
mso-hansi-theme-font:minor-latin;
mso-bidi-font-family:”Times New Roman”;
mso-bidi-theme-font:minor-bidi;}

Phil,
I became a member a couple of weeks ago.  Followed you on SA and decided to sign up for the income portfolio etc.

Now I would like to get your thoughts so I can reposition my portfolio properly and more importantly do some  “learnin”.  Some of the positions need to be repaired, removed or replaced.
Been working to absorb the phil…osophy and I have added some of your hedges since i.e. edz, tza and sqqq along with the tlt trade.
I will post my positions on the board over time and look for your thoughts/suggestions on what could be improved.
Long Oxy @ 85 was selling front month 85 calls and at present do not have any.  Rig at 50 same for the 50s. concerned about selling calls down here as im not sure re the rolling methodology.
Tks for your help.

hey all
sorry for the previous message.  figured it out and it wont happen again!

FTR – at least six different officers of the company bought shares in May. 

Egan-Jones strikes again – just downgraded the UK from AA to AA-.

Broken Butterfly/Silent & Phil – last week you commented that my BWB on AMZN might be buying too much premium (silent you specifically mentioned the $220 strike)..This got me exploring the setup, examining it if I had entered with the long July 220s and even with july 210s and 220s while keeping the short june 215s, and a flat out set with july expirations for the 210s, 215s and 220s.  Doing some good learning. To restate the initial entry: on 5/24 for net credit of $185, sold a June 1/3/2 BWB consisting of three AMZN June $215 calls @ 7.46 each, bot one AMZN June $210 call @ 10.49, bot two AMZN June $220 calls @ 5.02 each, with margin hit of $313.
.
Alternate 1: for net debit of $753, sell three AMZN June $215 calls @ 7.46 each, buy one AMZN June $210 call @ 10.49, buy two AMZN JULY $220 calls @ 9.69 each, with margin hit of $1263.  Also looked at an Alternate 2: for net debit of $1225, sold three June 215 calls, and sold one July 210 call and two July 220 calls, with net margin hit of $2225 and an Alternate 3 as if the whole thing was a July 1/3/2 BWB..
for discussion here, will just work with the alternate 1 …
At first glance, going with the july 220s gives a much more robust profit envelope.. but it is not the same trade and is at a cost.. specifically, 4x the margin requirement and is a net debit entry rather than net credit.  SO.. to try and make this a more apples to apples trade using margin requirement as the basis, quadrupling the flat June trade used the same margin ($1272 vs $1263 for the july 220 version) but rather than cost me $753, it put $728 cash in my pocket with downside protection to zero, and max win of $2681. However, the alternate 1 has absolutely generated a faster return, so far, and had more upside protection if I had got the direction wrong. 
.
I like both setups a lot. The same month BWB for credit is especially nice for it’s low margin and cash-in-pocket-up-front and super downside protection. The debit version with next month leg even better for any consolidating or channel-bound stock.. 
Thanks, guys, for calling this out as something to look at. Would be interested if there are different strikes you would have chosen or any additional aspects you would call out. I’m still new at these and as always.. learning!

Phil, any thoughts on WPRT.  I have been watching for some time, its volatile, but seems like a good time to start building a position.

I'm not sure if anyone lives in the Bay Area, but this is like a kick in da balls to all of us who loved an independent coffee shop/ bakery.  I ate here at least 4 times a week.  When they opened it was true artisian baking….
 
 
Starbucks buys La Boulange bakery chain for $100 million
http://www.usatoday.com/money/industries/food/story/2012-06-03/starbucks-bakery/55382660/1

We seem to be consolidating, but we said the same thing around the Down 5% lines…

 "Two words."
 "And, sir, what are they?"
 "Good decisions."
 "And how do you make good decisions?"
 "One word."
 "And sir, what is that?"
 "Experience."
 "And how do you get Experience?"
 "Two words."
 "And, sir, what are they?"
 "Bad decisions."

oops. bad decision. supposed to start with what is your secret of success.

Stjean – consolidating – i've seen more bottoms in the last 2 weeks than a month at the beach!

Mu point exactly Morx…  Looking at the charts, it looks like we paused at the Must Hold (?),  2.5% lines, 5% lines and now getting close to the 10% lines.

Phil / Income Portfolio – Based on 1M (500K actual).  Trades adjusted to reflect a different portfolio amount and margin requirements.  If I understand the entries correctly, we need to be sure there are sufficient funds in your virtual portfolio to double down and roll.  Thanks for the entries.

RSS feed,
Not sure if this helps, but I clicked on the RSS 2.0 link on top of the comments section (also can't get RSSOwl to work any more), and that worked fine so I set up the RSS feed in Internet Explorer.  I later went back to it, and I now got the message:
"Internet Explorer is unable to update this password-protected feed. Authentication forbidden" although the feed was set up with my user name and password.
 
Opening the Philstockworld web site in a second Explorer window now gave me a 'Guest View' with Phil's morning post but no comments, only a message saying that I had to upgrade to Premium Membership (I am a basic member) to see comments.  I was still logged in and I could go and see my account details, but not the comments.  Closing both Explorer windows (RSS feed and web site) and opening the Philstockworld web site again restored comments in the web site window.
 
Earlier in the day I played around with the IE RSS, including trying the /feed/atom/ (as compared to the default /feed/ that I got from the RSS 2.0 link) and got a message that 'this service is only available to Premium Members' or something to that effect.

Phil / TNA BCS – From your morning post:  A question for my continuing education.
Not much to do but see how things go this morning.  My favorite bull play is, of course XLF at our $13.50 target and TNA June $41/47 bull call spread at $3 can end up at $6 with TNA now $3.70 almost all in the money and, if TNA dips further – THEN you can stop out at $1.50 and sell some puts for $1.50 (currently the $39 puts are $1.30) and work into it that way.
I suspect front month vs. July due to the 3x ETF decay.  Correct?  TIA

Phil / Income – Basically I need to adjust recommended trades to the size of a smaller portfolio.  Sorry for the confusion.

Phil / La Boulange
It's a bad thing only if you've actually been there and enjoyed you're coffee and pastry on the sidewalk, watching the ppl go by.  It's a bad thing if you've ordered a french baguette toasted with butter, and you put 1 on of the 3 jams on it and drank you're capp overlooking the bay.    I can't imagine that they will keep the same quality of bread / coffee / butter / jams and nutella that they had in the past.  I can't imagine that they will employ the 28yr old latte maker that knows you and puts a shamrock each morning on your drink.  Etc.  
 
Another example of a big corp taking over a "mom and pop" type shop.  It's another example of why I don't live in the USA.  When you find those La Boulange's in the US, you cling to them like a baby's blanket.  When they are taken over,  I can't imagine they will ever be the same.  Fast forward 50yrs….will there be any mom and pop's left?  If not, that would be very sad…

Nice infographic of where China's Elite are sending their children to study: http://awesome.good.is/transparency/web/1205/export-of-students/flat.html
 
85% of China's rich are sending their children abroad.  Of that about 65% are sending them to either to North America or England. Throw in Australia and N.Z. and 75% are going to Anglo-nations. 
 
So it seems to me that the "rats in-the-know" jumping ship first and the "Americas" are the juiciest destination and also the future of China will be closely tied with the future of the U.S. and U.K.

he did have a sense of humor about being a c student..what is little known is that John Kerry and the Pres were both  Skull and Bones  or that  GWB had a HIGHER grade point than John Kerry…

Stay Connected

159,645FansLike
407,724FollowersFollow
2,130SubscribersSubscribe

Latest Articles

182
0
Would love your thoughts, please comment.x
()
x