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Fabulous Friday Finish in the Ides of June

SPY 5 MINUTEWheeee, what a ride!

We were bearish on Wednesday so you know it was time to flip bullish on Thursday and we did off that bad open where my morning Alert to Members added some aggressive positions:  

XLF/FAS is still my favorite bullish play to speculate with.  FAS July $83/90 bull call spread is $2.60 and you can sell a JPM Jan $29 put for $2.30 to knock the net down to .30 and, if you stop the bull spread out at $1.30 (50% down), then you are in the short JPM Jan $29 puts for net $1 and your worst case is owning JPM for net $28, which is 18% below the current price.  

Oil is also interesting (and I still like gasoline (/RB) over $2.65) at $82.50 and USO is down over 20% since May 1st so I like the USO Aug $35 calls for .53, selling the Aug $27 puts for .58 for a net .05 credit and your worst case is you are long on oil 13% below the current price or about $72 a barrel.  

Needless to say they are all doing quite nicely and that Futures trade on gasoline is the same one I mentioned right in Wednesday morning's post, when we caught that big spike up to $2.69 for a $1,680 per contract gain so, of course, we were thrilled to get another crack at $2.65 yesterday morning and we got another run to $2.69, where we took our non-greedy exit again.  

Oil futures ran up $1,500 to $84 and the USO spread shot up to .15 for a quick 200% on cash for the day and our FAS spread is looking very good with Sheila Bair paying JPM a backhanded compliment this morning, saying:  

They made a big mistake. I think it proves my point these banks are too big and too complex to centrally manage. But at the end of the day it was not any kind of loss that would threaten the viability of the bank.

Believe me, that was harsh compared to the parade of JPM flunkies posing as Senators who stumbled over each other as they competed to see who could bend over backwards the farthest for Jamie Diamon, asking him how he'd like the regulations to be written instead of WTF he was thinking when he decided to gamble with Federally insured money.  

 “We’re here quizzing you,” Senator Bob Corker (R-TN) explained to Dimon in a typical exchange. “If you were sitting on this side of the dais, what would you do to make our system safer than it is, and still meet the needs of a global economy like we have?”  Some Senators even asked Dimon what regulations he’d like to dismantle. “I would like to come away from the hearing today with some ideas on what you think we need to do, what we maybe need to take apart that we’ve already done, to allow the industry to operate better,” said Senator Jim DeMint (R-SC).

Rather than focusing on the clear and present danger presented by JPMorgan’s risky financial maneuvers, Corker then invited Dimon to opine on the “societal good” of his bank, and asked, “What would society be like without these institutions?”  

Dimon eagerly expounded on the value JPMorgan chase provides to the public, particularly “mothers and veterans.”  Instead of pressing for tougher controls, Senator Mike Crapo (R-ID) asked Dimon, “What should the function of the regulators be?”  ProPublica had a nice article titled: "Charting the Cozy Connections between JPMorgan and the Senate Banking Committee" that's sickening but a good read.  

Of course there's no need to buy all those Senators when you can just buy yourself a President.  Shelly Adelson, the LVS casino magnate who donated $21 million to a super PAC supporting Newt Gingrich and followed up this week with $10 million to a pro–Mitt Romney super PAC, will apparently donate “whatever it takes” to defeat President Obama, a source toldForbes. The owner of the Las Vegas Sands casino will reportedly make “limitless” donations to get Romney elected, the source said—which certainly is in line with Adelson’s recent comments that he could donate as much as $100 million to Romney’s campaign. To make a comparison, the $10 million Adelson just donated to the Romney campaign is equivalent to an American family with a net worth of $100,000 donating $40.

Meanwhile, anticipation is high but we'll have to wait for the weekend to see what kind of market rally the G20 is willing to pay for. 

Have a great weekend, 

- Phil

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  1. Good Morning!

  2. Good Morning!

  3. Economic Numbers

    Great Britain Visible Trade Balance / -£10103 (-£8500 expected)
    Euro-Zone Employment / -0.5%
    US Empire Manufacturing / 2.29 (13.0 expected)

    At 9:15 AM we have US Industrial production and at 9:55 AM we have the always important U. of Michigan Confidence (77.5 expected)

  4. Just watched Eric Cantor debate Austin Goolsby on Bloomberg.
    For the unindoctrinated, the right just seems to do a better job at delivering their message…..

  5. goolsby is aptly named..but very articulate ..cantor is a funny guy..he's like the congressional equivalent of kinky friedman

  6. 1020—sent you an e-mail—thx

  7. lionel you know the famous quote by kennedy at the wall?
    can you give the board the literal translation of that?
    very funny stuff
    TODAY: traders… want to be on board every market move…we know that's not always possible…and as PHIL tells you.. it's not always smart… this week we've seen 4 triple digit days – where the Dow moved more than 100 points….stocks are basically exactly where they were last friday.

  8. Angel – Would you want wait to see the U. of Michigan survey at 9:55 to see which way we are going?

  9. Savi/Vegas,
    I'm in as well – business2 @

  10. US Industrial Production / -0.1% (0.1% expected)

  11. Friday up, Monday down, Tuesday up, Wednesday down, Thursday up, means today is down using our super dynamic market predictive barometer. Almost as good as the Skirt Indicator or the Giselle Index.

  12. Pretty good week for FAS Money!

  13. The TNA Puts have to be watched as they are borderline now…

  14. Phil I was in a form of your 5kp FAS today BCS 78/79 which I paid .55, since it is a triple and those spreads seem tough to get out of some times I sold them for .95 on the open…MY question is this a bad play , should I have collected more, I have been having a tough time when to close spreads and if it is against me the triples seem impossible to get out.

  15. Clearing the deck today on this one!

  16. Savi/Vegas
    Put me down. I need a break from all this gambling and Vegas is a ood place to kick back and relax.

  17. If the market holds a nice gain today, could very well be a sell on the news event on Monday.  McClellan would start to get on the high range if we have a big day and hold it today.
    On CNBC today, they had Michele Cabrera badgering the Greek official she was speaking to about how the big problem is that Greek people don't pay taxes.  That's what everyone says.  He responded by telling her that taxes are withheld from all paycheck but there are some professionals that basically take cash to evade taxes.  So right away Joe Kernan starts ranting saying see, that's why they are in trouble, they don't care about collecting taxes.  I guess Joe forgot that the owner of his network GE, evades about all taxes every year, as do the oil companies, Apple, and about every other fortune 500 company not to mention individuals who take cash like contractors, small shops, hedge fund guys with offshore accounts.  Yes this is only a Greek problem.

  18. Taxes / Rustle – As usual, the small guy who can't hide anything gets blamed and the big guy gets away with it because he is a "job creator" I guess. Joe Kernen makes the show unwatchable now…

  19. U. of Michigan Confidence / 74.1 (77.5 expected)


  20. With the media making Greece out to be a serial defaulter, Spain has actually defaulted more times:

  21. rustle123 – Joe Kernan.
    What can I say?….. :)

  22. This is very long but very interesting.

    Bottom Line….dividends.

  23. Woops – I guess I should have reviewed the site before sharing….
    Darn google search…. ;)

  24. CNBC blog/1020
    We both spelled Joe Kernen's name wrong, good read.

  25. TLT up, VIX up, Market at the days highs.

  26. Good morning!  

    Europe up about a point but the Dollar won't go below 82 so hard to get a good rally going (82.13) with the Euro at $1.2614 but the Pound zoomed up to $1.5617 so now caught up with the usual .30 spread to the Euro and maybe we can get them both over the .27 line it will take to ditch the Dollar.  Holding us back will be Yentervention by the BOJ, who do not want to see the Yen as strong as it is (78.68) so we'll see who wins the tug of war today.  

    But who cares about the markets – We're going to Las Vegas!  In case you missed it last night, Savi has details on our November trip:

    Vegas Update—-dates are Nov 10,11 ,12th week-end need to get an initial read on how many  attendees

    Same format as last year—unless Phil wants to change it --you stay at a hotel of your choice--a no. of people stayed at Vdara we meet for dinner Saturday night (hopefully Nobu at Caesars) and then a poker tournament.

    The sessions are held at Cafe Moda, it is a restaurant owned by one of the PSW members (LVModa) sessions are Sunday starting around noon until about 5pm—-and Monday 6am until about noon (actually markets close at 1pm).  

    This info will help LVmoda to give me a ball park figure on cost etc—then I will let everyone know of the deposit needed—I do not think it will be more than $200-- $250 p/p—which would include the equipment and two meals (Sunday lunch and Monday breakfast)  per last mtg flight, hotel   and other meals are your responsibility

    please let me know as to your interest in attending the mtg so that I can get this going—-need to get a head count

    So, if you didn't already, please let Savi know you are interested in chat and, once again, you can expect nothing like a professional seminar since we all had a great time just randomly winging it last year with Sunday being mostly Q&A and Monday we played the markets.  Assuming he's interested, we'll properly block out a section for Pharmboy this time – so a little more organized – and perhaps if someone else has something they want to present…  

    Back to the markets.  Nas testing 2,850 and that's key to going higher this morning – everything else is good and I mentioned early this morning that the RUT Futures were good to play bullish (/TF) off the 760 mark and they're just now crossing it again.  For the Futures challenged – TNA $47 calls at .90 have a .20 premium and that's not bad at TNA can easily move .90 in a day and, fo course, tight stops since we're right on the 760 line in the Futures (764 on the RUT).  

    So the big moves we look for is Nas 2,850 and Dollar under 82 – that should pop oil back to $85 but I don't want to add to yesterday's longs there.  

    Silver is interesting for a long on possible QE/Stimulus next week.  The AGQ July $40/45 bull call spread at $2.30 is a fun way to play it and that's a nice 100% upside potential by itself but can also sell an ABX Jan $32 puts for $2 to drop it to net .30 on the $5 spread and net $32.30 is a 20% discount on ABX, worst case.  

    I have a good feeling about today – rather than not wanting to be long in the close – I would think the average fund manager will be terrified to miss something on Monday so we can expect some speculative betting.  If nothing happens over the weekend – THEN we might have a nasty disappointment sell-off next week but the G20 is Monday and Tuesday so I am feeling good about taking a few bullish chances into the weekend.  

  27. Why would any serious trader be getting long ahead of this election?
    Can you imagine trying to explain that to your boss – well I thought I would get long over the weekend??? 
    This seems like such BS - 

  28. A deeper analysis of the Empire manufacturing numbers:

  29. SAVI – Nov Vegas Trip – I'm interested

  30. Savi – Vegas – I'm interested. 

  31. Morning All – Savi, I am interested in attending the LV event.  Thank you.

  32. AGQ/Phil – for a bullish directional here, why do you like the July 40/45 over say the 42/45  or a July 42/47?

  33. phil,
    i moved the sqqq hedge from 55 to sep 60.
    your thoughts re the july edz  17-23 w/ 15 p and tza 20-25. time to roll or wait until weekend results. tks

  34. Savi: Vegas
    Count my head for Vegas, although a weekend after the election I may be moving overseas :(
     I'm somewhat skeptical about Phil needing a pool for laps.

  35. AGQ/Phil – curious how does the ABX Jan 32 put protects us, since it won't be put to us till Jan, whereas the AGQ BCS could be lost in July?

  36. SAVI Nov Vegas two people wife and I if this is permitted?

  37. 129M on the Dow and we're up 0.5% – that's nice for a change.  

    Crappy data by the way (no one seems to care):  

    At the open: Dow +0.53% to 12720. S&P +0.49% to 1336. Nasdaq +0.21% to 2842.

    Treasurys: 30-year +0.71%. 10-yr +0.41%. 5-yr +0.25%.

    Commodities: Crude +0.02% to $83.92. Gold +0.37% to $1625.65.

    Currencies: Euro -0.19% vs. dollar. Yen -0.83%. Pound -0.13%.

    10:00 AM On the hour: Dow +0.52%. 10-yr +0.35%. Euro -0.13%vs. dollar. Crude +0.29% to $84.16. Gold +0.42% to $1626.45.

    Market preview: U.S. stock futures held small gains afterEmpire State manufacturing came in below expectations. Futures had been tracking European and Asian stocks higher after the world's policy makers signaled they won’t allow a li'l ol' Greek election to start a depression. Spanish and Italian bond yields are also on the downswing. Still ahead: consumer sentiment.

    So who's buying??? (trick question, of course):  Apr. Treasury International Capital: Net foreign purchases of long-term U.S. securities were $26.1B, with net purchases by private foreign investors of $15.4B and net purchases by foreign official institutions at $10.7B. Taking into account both foreign and U.S. securities, the net foreign purchases of long-term securities were $25.6B. Foreigners trimmed their holdings of U.S. T-bills by $16.2B.

    There's a bright side to the euro crisis for the U.S. economy, as foreigners stepped up their investment with $28.7B in Q1, the 12th straight quarter of positive flows. Foreign direct investment in the U.S. in 2011 totaled $234B, a 14% jump Y/Y, with two-thirds of the cash coming from Europeans no doubt seeking a haven from their region's debt crisis.

    June Empire State Survey: Manufacturing 2.29 vs. 13.8 expected, 17.09 prior. New orders 2.18 vs. 8.32 prior. Prices 19.59vs. 37.35 prior.

    More on the Empire State Survey plunge: Optimism about future activity continues to fall, the future new orders index halving to 15.5 and the future shipments index more than halving to 12.4. The future prices paid index fell 24 points to 34.0. Expected number of employees rose, but the future average workweek declined. 

    May. Industrial Production: -0.1% vs. +0.0% expected, +1.1% prior. Capacity utilization 79.0% vs. 79.2% expected.

    Jun. Reuters/UofM Consumer Sentiment74.1 vs. 77.5 expected and 79.3 prior.

    More on the dive in Consumer Sentiment: At 74.1, the read is the lowest since December. Stocks move to session highs, the S&P 500 +0.6% as this print, combined with the plunge in the Empire State Index adds two more poor data points to back up yesterday's chatter about central bank intervention

    Mario Draghi adds to the idea of central bank intervention, telling a conference the ECB will continue its "crucial role" of providing liquidity. The comments may have been ignored any other day, but after yesterday's leaks, they take on new meaning.

    A New Democracy victory will be worth a 26 point (2%) gain in the S&P 500 and a 10 bp increase in the 10-year Treasury yield, estimates JPMorgan, while a Syriza victory could shave nearly 3% from the index and 12 bps from the 10-year. Presented without cynical comment.

    U.K. bank shares are partying following the joint BoE/Treasury plan to fill them full of cheap funding (which they're supposed to funnel into the real economy). The ADRs premarket: RBS+5.9%, Lloyds LYG +4.4%, Barclays +4.1%, HSBC (HBC+1.3%(HSBC is less pure domestic retail bank than the others). The FTSE 100, though, lags the rest of Europe, up just 0.5%.

    U.K. trade deficit +16% to £10.1B M/M in April – the second-largest on record – as exports fall 8.6% to £8.7B, the biggest drop since July 2006. Imports -2.5% to £33.9B. Trade deficit with EU hits a record £4.9B; with non-EU nations it widens 24% to £5.2B, suggesting that the attempt to boost exports to fast-growing countries outside the bloc is yet to bear fruit.

    Mark Hulbert's Nasdaq Newsletter Sentiment Index (HNNSI) continues to flash buy. At -35.3%, short-term market timers have 35.3% of their portfolio shorting tech shares. With the Nasdaq at similar levels in February, the HNNSI was +75%. A 110 point decline amidst a flat market testifies to the erosion in sentiment and may set the stage for a move higher

    Developed markets policymakers "are so wrapped up in their own problems," they're nearly ignoring significant slowing in the BRICs says Goldman's Jim O'Neill. Citigroup's Economic Surprise Index for the formerly fast-growing nations has plummeted to -81.10 from +15.8 just 3 months ago.

    More on the BRICs:  A consensus forms. After pulling out funds for 8 of the last 10 weeks, asset managers have their lowest exposure to emerging markets since October, according to a BAML survey. The MSCI BRIC Index is off 25% Y/Y and the rupee, ruble, and real are the 3 worst-performing currencies in Q2, according to Bloomberg. (Emerging markets are gaining appeal)

    Imagine the worst and double it summarizes Ireland's advice for Spain regarding its banking sector. Irish finmin Lenihan called the 2008 Irish bank guarantee the cheapest bailout in the world, costing the government nothing. Two years and €66B later, the government was insolvent.

    Capital One (COF) reports its 30-day delinquency rate for U.S. cards fell to 3.14% in May from 3.18% previously, the 4th consecutive decline. Auto loan delinquencies rose to 5.76% from 5.39%. U.S. charge-offs declined to 3.85% from 4.07% previously. (SEC filing)

    Annaly Capital (NLY) is downgraded to Neutral at Compass Point, taking some off the table after the stock has returned 8.4% (vs. S&P -3.4%) since the firm made it a Buy on April 9. Analyst Jason Stewart's positive thesis – a steep yield curve – remains in place for the stock and the mREIT sector, but an increase in prepayment speeds could provide near term pressure on net interest margins. Shares -0.5% premarket.

    Transocean (RIG+1.5% premarket after providing its fleet update summary, which includes new contracts and significant changes to existing contracts. Since RIG's May update, backlog associated with new contracts or extensions is ~$2.5B and planned 2012 out of service time decreased by a net 19 days.

    China takes advantage of slumping crude prices to build up strategic domestic supplies by 90M barrels through May, the fastest rate since the 2008 Olympics. The country plans to have stockpiles equivalent to 100 days usage – 600M barrels – by 2020 and is busily building storage sites for such.

    YPF (YPF) jumped 8.9% in AH trading yesterday after Carlos Slim disclosed he had bought an 8.4% stake in the Argentinian oil-and-gas firm. The purchase is a vote of confidence for YPF in the aftermath of its forced nationalization last month.

    Revelations that Barrick Gold's (ABX) recently ousted CEO Aaron Regent brought in more earnings for every dollar he was paid than any other CEO among top gold industry players may prompt shareholders to further scrutinize executive compensation models. ABX earned ~$515 for every dollar it paid Regent for 2011, according to Bloomberg data.

    China, the world's largest cotton user, is reportedly looking tobuy 1M metric tons of cotton from the U.S. to boost government stockpiles. Sources say 160K tons have been bought since last week. "The Chinese government has become the most important factor in global demand and supply," says analyst Dong Shuangwei, even as "the fundamentals still paint a rather gloomy picture." Cotton futures+2.43%.

    What goes around, comes around: Time Warner's (WTX) HBO network airs a documentary this week on former President George H.W. Bush as it simultaneously apologizes for displaying the severed head of President George W. Bush in a rapid background shot from a scene of Game of Thrones. Most damning of all for the network, it wasn't just the work of a mischievous intern, the clip was called out by producers in commentary on the show's released DVD.

    Microsoft (MSFT) will unveil plans to make its own Windows 8 tablets at a much-speculated L.A. event on Monday, sources tell The Wrap and AllThingsD. It's claimed Microsoft, like Google, has decided it needs its own no-compromise hardware to compete with Apple (AAPL), and that it could sell both ARM-based (ARMH) and Intel/AMD tablets. The move could rankle some PC OEMs, especially given reports Microsoft will charge huge license fees for Windows 8 tablets.

  38. Vegas – Actually would like to know how many are planning to bring their family as I would like to bring mine too but I don't want to get them bored. I have a 3 year old girl…

  39. Phil, if you are bullish Im assuming you dont like going long /dx right now? I just thought wed get a small bump up since of all the uncertainty this weekend…

  40. Angel/ the literal translation is: "Always sell premium" :)


  42. Savi – I am interested in Vegas. Not 100% sure I can attend at this point, but will try.

  43. Burrben –  Savi, pencil me in.  I just need to make sure I'm back from Argentina in time.  Actually I'd like to know how many people *arent* bringing their families.  I need a little trouble.

  44. Savi, count me in for Vegas in Nov. Thx!

  45. Phil – going long – thanks – QE makes sense as reason to get long – did not see your post when I was writing mine!

  46. Savi,
    I plan on attending again. Thanks in advance for all your hard work!

  47. Savi
    I am interested,  but would be coming out Sunday morning due to a prior commitment on Saturday.  

  48. Cantor/1020 – Oh I hate that guy!  Here's a clip of him telling you the poor have to pay more taxes.    

    Kinky Friedman/Angel – Now that was  an obscure reference!  

    We are still flatlining to the Wednesday, June 6th close.  The S&P is well over (1,315 was the line) and the RUT is under (765) so let's see what happens.  RUT was pretty soundly rejected at 765 so far.  

    SDMPB/Rpme – I hope not!  

    FAS Money – Damn that thing is a machine!  I guess it would be good form to sell SOMETHING for July, right?  The problem is a 10% pop in XLF to $15.50 seems innocent enough but that's 30% on FAS, which is $104 so it just doesn't seem like a good idea to sell July calls – JUST IN CASE – we get a stimulus pop.  Puts, on the other hand, I'm pretty comfortable selling so let's sell 2 of the July $75 puts for $5.55 so at least we have another $1,110 in our pockets for the month.  

    IWM Money – Should have killed those while we could.  Those of you sharp enough to read between the lines on my morning Alert may have noticed I was bullish on the RUT.  Now the short $47s are $1, not a total tragedy but gotta kill them here and we'll se about selling something later – maybe (same problem as FAS but not so bad).   Let's sell 2 TNA July $44 puts for $4.75 ($950) on the same premise as the FAS sale.  

    $5KP – Never going to happen on TNA but no harm in asking for .05 in case we get a silly spike and they trigger.  What happened to selling 10 TQQQs at .45 and setting a stop on the other 10 at .30?  FAS should expire at $1 but never hurts to ask for $1 unless you save fees on expiration (you do on TOS).  

    $25KP – Same crap on TNA – have to buy them out for $1.

  49. Phil—would you play  /SI ? or stick to the AGQ?
    Vegas—thx to everyone who responded—will update this weekend

  50. Savi – I'm interested.  Thanks.

  51. Phil/
    TNA July $44 Put are $3/3.2
    Are you looking at another strike?
    Selling the 44 put can pay for July 46/53 Call spread so I like the trade.

  52. TQQQ 5KP / Phil – We did sell 1/2 that day and kept the rest. On Monday they were at $0.43 at the open and dropped during the day and we forgot the $0.30 stop…

  53. PHIL: i know my audience!

  54. Savi
    I had a great time last year and am interested in doing it again. Thanks for organizing

  55. Phil TNA  Let's sell 2 TNA July $44 puts for $4.75 ($950) on the same premise as th 
    is only 3.00

  56. Savi/Las Vegas

    I am planning on attending also. Not sure about
    Saturday but Sun/Mon for sure. Thx

  57. Presenting in Vegas…sure….if there is time I would be happy to have a 'Vegas' pick for all to mull over!

    Um, SGEN….is a BEAST!  CLDX is starting to move as well.  YMI, I continue to accumulate in small increments.

  58. FAS/Sage – Nothing wrong with .95 in the hand vs $1 in the bush but, as I noted above – if your broker pays you when they both expire in the money and you feel secure about the close – it's fine to ride them out.  Verticals are difficult to get out of, that's very important to keep in mind as your caller will always have more premium than you so, when you want to get out early, you end up paying a penalty so try to be SURE you are willing to ride them out to the bitter end (or are able to leave the naked caller) or they will give you trouble down the road.  

    So funny, Monday's headline will be "Greece Votes to Keep Accepting Huge Bailouts – World Relived to Keep Giving them Money!"  

    Greeks/Rustle – That's the point the guy was trying to make (which is the same one I make about Corporate crooks here) – that it's the top 1% that don't pay the taxes, not the poor.  The bottom 50% in this country can't avoid payroll taxes, and sales taxes and property taxes and gas taxes, etc – they are built-in and have terrible penalties for being avoided.  It's the same in Greece, even more so at they have a VAT.  Rich people avoid taxes with shell corporations, expense reports, loopholes and other accounting schemes as well as outright fraud, which has for many years, been ignored in Greece.  Now they say – "Hey. we're broke and the rich need to pay their fair share" and Michelle goes "So the rich will all leave your country and then you'll be even worse off."  That's the dumbest statement ever (and it's made here all the time by GOP lackeys) – if the rich leave – then the poor people will be very happy to take the jobs, sales and incomes they walk away from and split them up.  With the 1,000:1 wealth gap between the top 1% and the bottom 20% – we only need 10% of the top 1% to leave and we can double the standard of living for the bottom 20% so, PLEASE, don't let the door hit them in the ass!  

    And what StJ said!  

    Spain/Rustle – Please, don't confuse us with facts…

    LOL 1020 – That's a good site too bad it's gone.  

    VIX up/Threeputt – Well I think it makes sense.  I hope everyone here has hedges – just in case…

    Long/Samz – Traders hate to miss big moves.  No one in their right mind would bet the farm on it but it is reasonable to make an aggressive bet with some cash as we could have a huge pop next week.  We could also have a huge drop but if you are a stock buyer – then it just means you'll DCA in and wait and the key is you'll still "outperform" the S&P as long as you have dry powder to average down.  What's very dangerous to a fund manager is when the S&P makes a big move up and they miss that – how do you catch up once you fall 2% behind?  

    Empire/StJ – Of course 6 months out is December so they'd better be expecting a pick-up by then!  

    AGQ/Scott – Because the $40/45 has less premium but a reasonable price (1/2 the spread cost) since it's over 1/2 in the money to start.  Also, I doubt silver will pop through $30 very easily so I don't want a spread that relies on a big move.  

    EDZ/Mill – That and TZA I'd wait and see how the weekend goes as you're right on the money and you can just roll the calls out if you want to keep them and let the callers expire to protect your gains.  

    Laps/Lincoln, Angel – They're not just for dancing you know… 8)  

    ABX/Lunar – It doesn't "protect" the spread, it merely lowers the net cost by offering to own something else that's long on metals – IF it gets 20% cheaper.  This is an aggressive bullish play on metals per QE anticipation.  If we don't get the QE, you can stop out the AGQ and whatever remains can be applied back to the put and then you just have the short put at net whatever.  Obviously, if you don't have enough faith to buy ABX at net $32 in Jan – what on Earth would you be doing going long on Silver for July?  

    Dollar/Jrom – No, I'm looking for them to fail to hold 82 and rally the markets.  I'm thinking that even if the EU does a massive bailout, the Euro is still priced to fail and the amount of currency dilution over there will not be enough to outweigh the relief rally of people running back into the Euro so the Dollar can drop sharply next week if the EU doesn't collapse.  

    Families/Burr – I'm bringing mind in July so I won't feel bad about leaving them home in November.

    Long/Samz – Don't go too crazy, this blimp could still burst into flames…

    Silver/Savi – Off the $28.50 line, yes, I'd play silver but the problem is it's really a weekend play and I would NOT leave a futures bet open over the weekend.  

    TNA/IWM Money, Lionel – Well I don't know where that number came from but now they are $3 and the strike is right, even if the amount was not.  

    TQQQ/StJ – I don't get it.  So we say we're going to stop out and then just never do?  That's not really teaching good habits!  Those calls were .45 on Monday – how is it possible we never got out?   My comment was from the previous Wednesday:

    TQQQ/$5KP, DC – Yes, thank you.  We bravely bought 15 more at .23 to lower our avg to .41 and now the TQQQ $50s are .45 so let's sell 10 of them and set a stop on the other 10 at .30. 

    On the 7th they were at .60!  That's a lot of money to blow off in a small portfolio…

  59. I'm buying QCOM July 55 calls for 3.10.  This is NOT a MoMo trade.   

  60. TQQQ / Phil – We did sell 1/2 at $0.45 but I can't catch everything, I am tracking 5 portfolios now… Hopefully others got out on Monday when it went from $0.45 to $0.25.

  61. Phil Thanks for clarifying.
    Sold Put 44 July for 3.2 and bought july 46/53 for 3.35 and $2 in the money…
    I like this trade!

  62. Oil, gold, silver, AAPL and the Financials not performing too well so far.  Dollar still holding that 82 line so be careful – clearly some people doubt the miracle of the impending bailouts.  

    TQQQ/StJ – In the $5KP, not losing a few hundred Dollars is a little more important than the others.  I don't think we should run such a small portfolio if we can't stay on top of it – that's why I'm concerned.  

    Oil under a lot of pressure and that's odd as they have a whole week to dump 116M barrels but they're breaking down at $83.50 so watch that line.


    Click for
    Current Session Prior Day Opt's
    Open High Low Last Time Set Chg Vol Set Op Int
    Jul'12 84.33 84.80 83.65 83.98 11:53
    Jun 15


    0.07 96322 83.91 116945 Call Put
    Aug'12 84.67 85.10 83.96 84.29 11:53
    Jun 15


    0.07 37560 84.22 258283 Call Put
    Sep'12 84.85 85.37 84.24 84.55 11:53
    Jun 15


    0.05 11325 84.50 130125 Call Put
    Oct'12 85.23 85.60 84.53 84.85 11:53
    Jun 15


    0.09 4745 84.76 71138 Call Put

  63. Savi- Please count me in for Vegas- thanks for spearheading things.

  64. TNA/Lionel – Very nice but don't forget what your buying premise is.  If the premise fails next week – don't try to find reasons not to take the loss.  That's one of the hardest things to do on those trades.  

    TLT back to $126.50 – That's a little disturbing.   Still, Europe was REALLY happy and we are now lagging considerably, would be strange if we don't close up 1%.  

    11:00 AM On the hour: Dow +0.53%. 10-yr +0.42%. Euro -0.06%vs. dollar. Crude +0.34% to $84.19. Gold +0.76% to $1631.95.

    11:56 AM European stocks close mostly sharply higher ahead of this weekend's Greek elections, investors perhaps comforted by central banks on the sidelines with bazookas loaded. Stoxx 50 +1.5%, Germany +1.5%, France +1.8%, Italy +2.4%, Spain +0.3%, U.K.+0.2%. Spain's IBEX rose 2.6% for the week following its bailout agreement, EWP +11.8% for June.

    12:00 PM On the hour: Dow +0.53%. 10-yr +0.43%. Euro +0.01%vs. dollar. Crude -0.24% to $83.7. Gold +0.45% to $1626.95.

    What do Treasurys know that stocks don't? Usually moving in lockstep, Treasury yields are diving as stocks meander higher. The10-year -7 bps to 1.57%. TLT +0.8%.

    Gallup polling data shows Americans get progressively more pessimistic the further away from home they get, as 49% rate economic conditions in their local area as excellent or good, but 25% positively rate the U.S. economy and 13% the world as a whole. The data suggests Americans may not be in such dire straits as might be assumed based on national confidence ratings. - I agree with this, things are not as bad as people think in this country.  

    The S&P 500 SPDR (SPY) pulled in $6.4B in the week ended June 13, the heaviest inflows since October 2008. Thought to represent the behavior of institutional investors, the move is not necessarily a bullish sign as these types use SPY as a trading vehicle or as a spot to park short-term cash.

    Madrid diverges from a broad European stock rally, the IBEX 35 -0.4% with the Stoxx 50 +1.3%. Spanish government bond yields just won't cooperate with all the bailout talk, the 10-yearcharging back towards 7%. The 2-year is up 14 bps to 5.12%, its highest level of the year. One would think Brussels Mandarins could at least keep a lid on shorter-term paper. 

    PFP Wealth Management's Tim Price's hilarious one-size-fits-all letter to clients regarding this weekend's Greek election and the market/official response. "Following the (shock/expected/bizarre) election of (ND/Syriza/Neo-Nazis), the eurozone was returned to a state of (normality/bowel-clenc… terror) …"

    Insured losses from Wednesday's hailstorms in Dallas could be among the worst - excluding hurricanes – in U.S. history, the SIIS predicting the total could reach $2B. "This is preliminary and we are hopeful that the damage fall(s) short of what we are predicting," says the group's president.

    Oft-criticized Sears Holdings (SHLD +0.8%) appears to be outperforming rivals in the use of Big Data to set pricing on the fly at its retail stores. The company is using open source software to correlate large amounts of data relevant to pricing in a bid to maximize margins. The big picture: The retailers with the most sophisticated algorithms increase their ability to incorporate real-time data such as weather and buying trends and become more efficient.

    Shares of Green Mountain Coffee Roasters (GMCR -2.9%) can't shake off that losing feeling as they dip below the $20 mark. This week's headaches for management include the news that single-serve competition is around the corner from Kroger and Safeway, while the overriding theme on GMCR is that the company hasn't solved the issue of what it will do to counter the patent expirations (III) that are around the corner.

    Qualcomm (QCOM) and Broadcom (BRCM) have begun producing 4G baseband and Wi-Fi chips, respectively, for the next-gen iPhone (AAPL) via TSMC's (TSM) 28nm process, Digitimes reports. OmniVision (OVTI), STMicroelectronics (STM), Texas Instruments (TXN), and NXP (NXPI) are also said to be ramping production of next-gen iPhone chips. It's added TSMC's 28nm supply constraints, exacerbated by Nvidia's (NVDAsignificant needs, continue to be a problem

    Not dead yet:  Nokia (NOK +4.3%) bounces a little following yesterday's huge selloff as M&A speculation grows, and Oppenheimer upgradesshares to Perform. The firm argues Nokia's woes are now priced in, and that staying short is "risky" until the impact of Windows 8 on the company's prospects comes into focus in Q4. The rally comes even though Moody's is downgrading Nokia's debt rating to Ba1 (junk) from Baa3 with a negative outlook. (more on NOK)

    Maybe GOOG is going down because they are messing everything up with GREED!  YouTube (GOOG), which is making a huge push into professional content, is thinking of selling subscriptions for access to some of its offerings. Division chief Salar Kamangar suggests smaller channels receiving minimal affiliate fees from pay-TV providers could be included, as could some existing content providers. The FCC isexploring whether to regulate online video sites in a manner similar to pay-TV providers, and thus guarantee them access to the same content.

    Thanks to the Facebook (FB) fiasco and the resulting selloff in many richly-valued Internet names, the tech IPO market could be dead for the rest of the summer, suggests Goldman banker Anthony Noto. Only a solid company willing to "haircut" its estimates and valuation can go public right now, Noto argues. His remarks come as Bloomberg Businessweek reports fast-growing cloud ERP and HR software vendor Workday plans to file for its anticipated IPO this month.

  65. @Felipe
    Many many muchos for your TASR (Phil's personal Trade of the Decade!) suggestions of the past year or two.
    Today marks the expiry of those $5 June puts 200 of 'em I sold about 10 weeks ago.
    Needless to say, but I'll say it anyway, it was all profit and I can't calculate the percentage gain because I'm—-- "So excited!!…..I just can't Hide it!!"
    I can't think of even one nailbiting moment over the past two months that I had over this trade.
    I would like to do it again, but I'm waiting for further out months to open up. I don't see any things past December 2012 on TOS.
    Do you have any other strategeries for this trade, than the straight short put sale that might be considered? 
    Again, thanx.

  66. Long oil off 83.50
    EUR USD bouncing off 1.2625
    which should provide some support
    As Phil noticed correctly we are lagging by almost 1%
    Some people are going to th nuke shelter and buy UST some people are buying the market – What a funny day!

  67. Gold – Hathaway is bullish (of course). Describes a base already in and new highs coming in this letter:
    "On three occasions since the December 29, 2011 low of $1523.90/ounce, the Bernanke Fed has stated that further rounds of QE were off the table.  The first was during congressional testimony February 29th.  Gold reacted by dropping more than $100 in 24 hours to $1688.  The second was the release of the Fed minutes April 3, 2012.  The reiteration of Bernanke’s earlier stance led gold to drop $72 in two days to $1613.  The final instance came in Bernanke’s congressional testimony of June 6, when, following a very weak jobs report and a subsequent sharp rally in the gold price to $1640 intraday, he again disappointed the gold market by removing the prospect for additional QE.  Gold dropped $86 to $1556 in two days.  In no moment of QE disappointment did gold fall to a lower low than the $1523 of year end 2011."

  68. lflan, what's your view on qcom ?

  69. GOOG – "Division chief Salar Kamangar" Trying to monetize youtube? Sounds like some kind of Thunderbirds-era arch villain!

  70. phil,
    tks for the update

  71. Savi – you can put me down for a maybe. Im hoping with the replacement of 28K in troops with $300K a year contractors er, I mean the 'troop drawdown" they will let me leave here in Nov. If I have to stay I guess Ill end up doing a Kabul DFAC cuisine tour

  72. Hello there Phil & Co    Reporting in.  Back for a few weeks from  London, York, Barcelona…and Iceland (just for fun).
    England crazy acitivty of course…even York.  Diamond Jubilee not a bad stimulus package :) .  I know..wait to see the bill first.  Barcelona didn't need a Jubilee…couldn't even walk down the wide boulevards without knocking shoulders…any time of the day or night.  Just as many locals buying stuff as tourists.  Must have one cab per person…never seen so many cabs.  Cabbies all say a little slower than the peak but business still good.  Madrid may be in trouble but Barcelona is bustling.  Same for the whole state of Catalunya. 
    Not such good news in the shipping business.  Still hope for the second half to improve.  Interesting web site that tracks world wide container shipments with 60 large international shipping companies.  Created an index.  Graphs and indexes not the end all but always another peice of the puzzle.  May be worth checking form time to time.

  73. Correction…index tracks ports not shipping companies….

  74. StJ
      For all that you do for the board, you deserve to be carried around in a sedan chair in Vegas (assuming you're going).

  75. I think STJ would rather us just let him win the poker tournament-LOL :)

  76. Phil,
      Thanks for the APPL/WWDC response. I actually rolled my July 575s down to the July 550s for $15 before I saw your response. Another question I had is how to position for the weekend. My hedges are the EDZ July 17/26 spread for $2 and TZA July 20 call for $3.55 (also short he EDZ July 16 put). Trying to determine if I should roll down in strike in the same month or roll down and/or out? Thanks.

  77. stj/Vegas – you are going, right?

  78. Phil /  "Hard Six" long for the weekend
    Any trade jump out at you that looks "cheap" right now as a long into the weekend that could payoff big?  
    Apologies if I missed a trade earlier yesterday or today that would be good, I'm taking care of my 80yr old mom for few weeks, and it's hard to focus and do research.  Tks in advance!

  79. Vegas / Nicha – Doubtful… I have a lot going on right now (with my business) that makes it hard to plan ahead.

  80. Phil
    For FAS Money sales do you always prefer the monthlies over the weeklies? Big premium on July 75s sold, but I remember more of a weekly sale back in the beginning. A nice start for my portfolio this week!

  81. Euro flying toward 1.265 – this is a big resistance to the way back to 1.28 and then 1.30

  82. Phil/5KP
    Please continue the portfolio. In case of TNA you had already provided the trade with the stop so it is assumed that people would have carried that out. It is our fault if we have missed it.
    And Stj is doing an awesome job maintaining the portfolios!

  83. stj/Vegas – you missed last year too. You should come before Phil starts charging :)

  84. I love that headline: 

    What do Treasurys know that stocks don't? Usually moving in lockstep, Treasury yields are diving as stocks meander higher. The10-year -7 bps to 1.57%. TLT +0.8%.

    Tells me ….  things are not as rosy as they seem.

  85. Pharm, I invested in MNTA with the June $15 buy write and at net $11.47/$13.23.  With MNTA, what is your suggestion on rolling the caller to July $15's at a further credit of $1.02 and then selling more puts to extend the buy write?  I am sure happy with the 23.5% gain in less than 60 days, but was interested to know if you were still bullish on the company.  Great call and thanks!

  86. Must Buys – anyone see any today?

  87. 1.265 providing good resistance so far, I am off with 40c
    Oil at PP and it is Opex day so not much to hope for…..the moment!

  88. How did we miss SAN,  up  1,100 perCent??

  89. Joke, BS, and I smell fish.  Roll that all into one, and it ain't no pun – we are going to have fireworks next week just for fun.  Which way will this market run?

  90. TASR/Flips – Nicely played!  If you already have the stock, then $5 is a nice spot to sell the Dec $5 puts and calls for $1.30 – that's 25% in 6 months – not a bad way to hang on to a stock…  If they had 2014s, then I'd want to pair it with a long call and longer put but you gotta play the hand you're dealt. 

    Thunderbirds/Scott – LOL!  

    Kabul dining/Jrom – I love the 4 exploding stars rating.  No surprise the French are tops, you can drop those guys anywhere and they'll whip up a good meal. 

    Thanks for report living – sounds like a good trip.  What's up in Iceland?   

    Hedges/Japar – Same as to Mill above, they are still close enough to offer good weekend protection and, if not needed, you can just roll back the long calls to longer-term insurance.  

    Weekend/Burr – USO is still playable (in the post above) and Silver still works (morning Alert) – those both have a great chance to pop on QE news.  Best wishes to your Mom – mine's 72 and running around Europe with my niece at the moment, probably bumped into living at the Jubilee.  

    FAS Money/Crussell – I prefer weeklies when I think we're calm enough that we don't need the cushion – but that's not now.   

    $5KP/Pat – I don't mind keeping it going but we do have to follow the rules.  With a small portfolio with limited ability to adjust – it's critical!  

    VIX very stubborn at $22.  

    SAN/Flips – 1,100%???

    157M on the Dow at 1:40 – pretty dead since the strong open.  

    Oil held $83.50 and the Dollar is just below 82 ahead of the Prez – maybe we get a nice Obama rally to end the week but would be strange on expiration day to have a stick.  

  91. Pharm/
    I agree with your analysis. You were right on UST going to Japanese levels when everyone was fretting about inflation.
    But since there is no market (ie no volume) and almost no panic so far, I believe they can turn this market around at anytime. We are just an audience.
    I would say that it will hurt the most if we go up and fast – too many shorts and too much cash on the sideline.
    So I am betting up and fast (Single stock volatility collapsing) even if I believe that we should correct at least 10-20% from here (US markets)
    Selling Put premium seems the best tool for it.
    Q2 earnings will be another story…

  92. Savi/Vegas – I am interested.  Good time of year to leave a rainforest for a desert!

  93. 12:00 PM On the hour: Dow +0.53%. 10-yr +0.43%. Euro +0.01%vs. dollar. Crude -0.24% to $83.7. Gold +0.45% to $1626.95.

    The U.S. Reaps Benefits as a Scarce Berth in the Safe Harbor (Barron’s)

    Forget the spread between German and Spanish debt as a stress indicator, writes Stephen Bernard, keep your eye on the German-Swiss spread. Ideas the EU debt issues will eventually crater the German balance sheet are gaining more traction and is being reflected in Swiss 2-year yields 43 basis points lower than German vs. just 9 bps a month ago. (nice companion piece here

    Even as German bond yields fall to unimaginable levels, CDS spreads on the country's debt are on the rise. It's a troubling sign, writes Sober Look, suggesting German debt is not quite as risk-free as a 1.44% 10-year Bund yield would suggest. 

    As Europe’s Currency Union Frays, Conspiracy Theories Fly (NYT)

    The EU Smiled While Spain’s Banks Cooked the Books (Bloomberg)

    Greek Dilemma: Buy, Sell, or Hide (WSJ)

    Banks Get Mauled by Bears’ Bets (WSJ)

    Yep, really liking silver and oil here!  Mexico's pension funds – known as Afores – have been given regulatory permission to invest 5-10% of their $121B AUM in commodities starting on June 20. The funds have typically allocated most of their holdings to the country's debt markets. Barclays, BlackRock, and Deutsche Bank are waiting in the wings to pick up some of the business.

    Cheniere Energy (LNG +4.3%) shares are hopping after S&P raises its corporate credit rating on the company and Citi follows by reinstating coverage of the stock with a Buy rating and a $26 price target, citing the full contracting of LNG's four-train liquefaction project at Sabine Pass.

    Falling oil prices are typically good news for airlines as fuel accounts for more than a third of their operating costs, but fuel hedging so far has prevented many carriers from benefiting from the recent decline in prices. "You can't win at [hedging]… It's a casino," one air exec says, speaking for others who believe the trend can't be sustained given the volatility. 

    Solar stocks are closing out a volatile week on an up note (TAN +2.5%). Option expirations could be driving some traders to close out their bets. Among the big winners: TSL +8.6%STP +6.5%.GTAT +5.7%.

    YPF (YPF +10.5%) shares are jumping on news Carlos Slim has taken an 8.4% stake in the Argentine energy company, but Street Insider says the billionaire's stake may not be all it seems. Slim's stake could somehow be tied to loan defaults following the YPF nationalization; otherwise, it just "doesn't make sense" that Slim would buy into a nationalized company.

    This summer will see a crowded slate of animated movies with DreamWorks (DWA +0.8%Madagascar 3: Europe's Most Wanted, Pixar's (DIS -0.1%Brave, and Fox's (NWSA +0.9%Ice Age: Continental Drift all debuting within five weeks of each other. Each film boasts strategic box office advantages, but analysts find it unlikely that all three will be smash hits as they can't help but cut into each other's target demographic. - Not to mention Spiderman and Batman – could be a big disappointment on these 3

    SanDisk (SNDK +3%) rises after BofA predicts the company's bottom line will show a cyclical improvement in 2H and 2013-14 thanks to supply constraints for competitors (i.e. Samsung) and new products (MacBook Pro solid-state drives are cited as an example). The firm is lowering its PT to $56 from $64, but that's still 53% above current levels. SanDisk shares have been pressured by amajor drop in NAND flash memory prices, and concerns about slowing smartphone growth. 

    My baby gives it, she gives it away:  Amazon (AMZN) plans to drop the price of its current Kindle Fire by $50 to $149 as it makes way for a next-gen model with a high-res display, claims Digitmes. The site, whose track record with Kindle Fire rumors is spotty, also claims Amazon is planning to launch a 10.1" Fire model in Q4 or Q1 '13, as well as a 6" backlit Kindle e-reader in Q3 or later. Kindle Fire sales, still focused on the U.S., havegone south thanks to the iPad's popularity and mixed customer satisfaction.

    What Facebook Knows (Technology Review)


    Counting on an Inheritance? Count Again. (WSJ)

    Three lunchtime reads:

    1) Greece before the election: Wait and flee

    2) Greece now just a footnote

    3) True recovery pushed further into the future

  94. Or perhaps i should ask, anyone see any Must Sell opptys?

  95. Savi:
    Vegas.Ain't 'that a bitch.Last week I booked a cruise for Nov 11-17. Dam !

  96.  Banks With High Derivatives Concentration May Be Too-Big-to-Fail. Regulators will probably view six banks with 75% of the U.S.'s derivatives assets and liabilities as too-big-to-fail, according to a Fitch Ratings analyst. A Fitch study released last week found that three-fourths of derivatives assets and liabilities among 100 big U.S. firms reside in six banks – Bank of America(BAC), Citigroup(C), Goldman Sachs(GS), JPMorgan(JPM), Morgan Stanley(MS) and Wells Fargo(WFC). The report is the first to quantify how derivatives are concentrated across all sectors SMALL DETAIL

  97. Vegas – Deal me in!

  98. smala/QCOM/view/………up…….calls already up 10%, if you bought and want to take some profit.  I will hold into next week, or longer.  

  99. MoMo trade:   Bought to open AAPL July 575 calls , 5 @ 16.60.  AAPL is pinning 570 today, most likely.  I think it moves up Monday.   

  100. All / WMT – I sold a call spread on WMT, betting it will stay below $70.  My rationale was that it had a nice run as a safety stock, but the buying was overdone.  If things get horrible, it would ultimately get dragged down with everything else, and that if things get better, buyers would move on to more exciting stocks.  The risk/reward on my strategy probably wasn't the best, but any thoughts on the premise of my investment going forward?


  102. Gold and Treasuries are not acting like there is going to be stimulus, QE, ball rubbing, whatever you want to call it.  This is pure, old fashion manipulation, and putting on cheap shorts.  P/C ration on SPY is 2.2.

  103. Mario Draghi [from BBC]: "Mr Draghi, speaking in Frankfurt, said that while financial authorities stood ready to act if necessary, it was now for politicians to take the lead.  'Political choices have become predominant over monetary policy instruments,' he said.  The euro currency needed 'strengthened foundations' which would mean governments relinquishing some powers over financial and economic policy to supra-national bodies.  Mr Draghi said that he and other top officials working on a longer-term vision for the euro and economic policy will have something "very soon… All the work we're doing is with a view to the next [EU] summit" at the end of June.  'The outcome will get to be known pretty soon, in a matter of days,' he added."
     Why does this not sound convincing?  Perhaps because I'm not aware of any "supra-national" discussions that are taking place in a serious way among the major Euro countries.  Or perhaps because, ever since the "peace in our time" announcement [Sept. 30, 1938, after the Franco-Prussian War and WWI, shortly followed by WWII], I don't believe European countries are capable of reliably reaching agreement on anything at times of crisis.

  104. Bingo Zero….! 

  105. Phil – Thanks, I really like the USO trade.  Trying to get into it now…although it's now a bit of a debit.  No worries.  My mom can barely walk, so no Europe for her, just a few church fairs and music shows.

  106. SGEN 22.5 June Calls….how sweet were those.  I am going to exercise my stock for those.

  107. @Felipe
    From:   6.50 to $74.12

  108. RIMM – Just wanted to share this.  I was walking around the Altanta Airport for 4hr layover (most traffic in the US), and there were 3 Blackberry stores.  There was not a SINGLE person in any of the stores.  All the other stores had a few people, to a lot of people.  Seriously, not 1 person.  The sales people were all just hanging out of the store window gawking at people walking by.  I had some food right next to one of the stores, and no one even glanced at the display windows.

  109. I am in for Vegas, excited to be there the entire time and not just the last day!

  110. @Felipe
    Only sold the $5 TASR puts naked
    Do not own any shares.
    Although I hoped to have the shares  put to me at 5.00, (also hoping that the shares would be at 4.97) so that I can sell the Dec 2012 $5 Calls.

  111. Flip : Must be a google error.  I'm seeing 6.09×6.10 on IB.  
    Q: Why do you put that @Felipe in front of your comments.  What does it mean?

  112. Felipe = Phil

    See This:
     This summer will see Madagascar 3: Europe's Most Wanted, Brave, Ice Age: Continental Drift  not to mention Spiderman and Batman.
    ALL debuting at about the same time.

  114. Boy the DJI has not moved all day

  115. And "@" means "right atcha?"

  116. lol

  117. Yodi, Triple Witching is turning out to be a very damp squib today.  

  118. MoMo trade:   Sold to open one next weekly PCLN  570/545   short strangle for 16.20.    (I'm keeping the PCLN next weekly short 615 put sold yesterday).    

  119. IFlan – I'm liking the pinning action on AAPL.  I sold today's $565/570 bull put spread for .48 at 3:00 PM.  Just watching the time decay spill into the account after a long Friday.

  120. Iflan….I thought there was no margin use in this MoMo trade account?  or maybe it is another one I am thinking of……?

  121. Iflan – u mean the 670/645?

  122. Pharmboy…..There is no margin use beyond what is in the account.   The margin for this trade plus the sold 615 put is about 25k.   This is within the account value.  Tis true, we will not use any margin beyond what the account is worth.  

  123. Next week SPY 133/132 bull put spread for 31c.  Protection!

  124. nicha….yes, 670/645

  125. LFlan – I don't think those strikes are correct.  Maybe the 6's?  I'm guessing AAPL on the brain…

  126. Gotcha.

  127. Burrben…That's correct, AAPL on the brain and trying to trade PCLN.   But you guys will not let me stray far from the correct trade, eh?   :)

  128. LFlan – Maybe I'm just over conservative, but why sell a strangle when there is a high prob of a big move up or a move down after the greek election.  

  129. Remember that "Kindness in America" hitchhiker who got shot a few days ago?   And now (with apologies to Paul Harvey)… the rest of the story.

  130. Pharm, not sure if you saw this earlier – I invested in MNTA with the June $15 buy write and at net $11.47/$13.23.  With MNTA, what is your suggestion on rolling the caller to July $15's at a further credit of $1.02 and then selling more puts to extend the buy write?  I am sure happy with the 23.5% gain in less than 60 days, but was interested to know if you were still bullish on the company.  Great call and thanks!

  131. Now we're up about 1% – that's more in-line with Europe.  

    WMT/Rky – Good premise.  Very unusual that they've moved up so much this year.  

    Europe/ZZ – They are just very slow-moving and we're talking about major changes so the ECB is ready to backstop a slide if they have to but they hope the EU acts before they have to.  It's hard for Americans, who are used to being told whatever they want to hear by our officials, something iffy-sounding by European politicians, who tend to shoot straight – it confuses us.  

    Walking/Burr – I know, enjoy what you can while you can I'm saying…  RIMM sounds very sad.  

    SAN/Flips – Then I guess I should be scooping it up in TOS for $6.11!   Yahoo has the same price as does Etrade so you might want to check before acting off GOOG Finance.  

    TASR/Flips – I'd sell the puts and calls for $1.30 and buy the stock if they pop $5.25.  

    Squib/ZZ – Speaking of squib (not really) I was watching Hell's Kitchen last night and Chef Ramsey starts yelling about how the chefs can't cook a pigeon properly and the diners are looking around like "did he say pigeon" and my kids and even Tina were like "WTF?" – it's funny how many Americans don't know what squab is….

    This is 5% on the Dow from 12,150 (12,757), which was our early June low so going to be tough to pop this with no pullback.  Other 5%s off the bottoms (non-spike) would be S&P 1,350, Nas 2,887, NYSE 7,665 and RUT 777 so I'm pretty sure those will cap our gains for the day.  

  132. Re: Iceland   Counrty and people doing very well.  No apparent negative ramifications of the currency crisis or thumbing their collective noses at repaying the UK(?) backed soverign loans.  Maybe more to that if we could see their national balance sheet.  But on the surface employment about the same as it has historically been.  Lovely people, amazing landscape, very diverse.  Parts that are like no place I've ever seen on earth.  Amazing seafood and natural grass fed cattle and sheep.  A vibrant, resolute, independent minded people.  Very proud of their viking roots.  Telling Britain to take a hike on repaying the national loan/debt seems to have worked quite well for Iceland.  But it is a tiny population with apparent equilibrium between population, employment and economy.  Fishing, agriculture stalwarts of the economy and tourisim a third and growing leg of that.  Highly recommend a visit.   Went just becuase we were flying over it on the way home and had never been. 

  133. Burrben…… Because I can?     No, seriously, there are a lot of ways to make money in the market.  Right now I'm playing "suck the premium out of the MoMos".   If it charges upward next week we will sell adjust accordingly.  But you are correct, PCLN more likely than not goes up next week.  To guard against such a move perhaps we should buy a July monthly 670 call?   

  134. Pharm – SPY 
    When you say "protection" are you protecting to the upside with the bull put spread, or did you mean protecting to the downside, with a bear put spread?  
    I guess I like the idea of a bear put spread for downside protection, as I'm a little underhedged.

  135. I would second the call to continue the $5KP, it had some good trades for small portfolios like TLT (both ways), GLL, USO etc. I found that I learned a lot on position management, scaling and rolling. I think the goal for anyone following the trades is to be at a point where the 'normal' adjustments – rolling, DD and of course taking profits come naturally, and Phil's calls are more of a confirmation.

  136. MNTA – that is the move to make, and yes, I still like them long term.

  137. Phil, I have some bullish plays that will pay off if we shoot up next week, could you post your favorite disaster hedges? Are they still the plays from earlier this week?

  138. Burr – downside.  Otherwise I would have 'sold' the spread.  I am doing 10. 

  139. '12 elections – gonna get ugly……

    Now the lowly reporters?……

  140. Phil:  You're telling me that "squib" is the plural of "squab?"  Ya learn something new every day – if you pay attention!

    this idiot is a one man wrecking crew for the president..i hope romney asks christie to run with him then at least two singularly unattrative facing each other

  142. Pharm – Right, that's what I thought.  I believe that's called a Bear Put spread, by buying the 133 and selling the 132.  
    I remember it by:
    Bull Call Spread / Bear Put Spread are Debit Spreads  (we like these on PSW, defined risk)
    Bear Call Spread  / Bull Put Spread are Credit Spreads (we generally don't like these on PSW)
    I'm not trying to be a Mr Knowitall, just being specific so I don't go bullish, when I want to protect to the downside.  Thanks!

  143. revtodd….yes, bull put spreads.  Loved by some, feared by many.  But if you pick the right spread, right time, right stock…..then money to be made on them.   

  144. Lflan – PCLN
    Well for me, I'd just wait until I know what happens in Greece this weekend.  Although if you compare my track record to yours, I'd ignore my own advice :)

  145. AAPL can't hold 570.   I'm looking for a breakout on Monday.   

  146. Livingfull:  I've flown over Iceland quite a few times, it seems a beautiful country and I shall stop in some time.  I've read all the Icelandic sagas, which one British critic described, not unfairly, as "peasants at loggerheads" but still a fascinating contemporaneous account of early European life.  "Plus ca change" I suppose I should add…..

  147. What RIMM needs is an MMA fighter, Motley Crew and a super model for their new marketing campaign….
    Works for KIA  :)

  148. I strongly believe that if Greece looses vs Russia tomorrow Tsipras will fare badly :)

  149. " Crue", w/ umlat. 

  150. lionel hahahahaha!

  151. MoMo trade:   Buy to open one PCLN July  670 call for 20.70

  152. zero/"crue"  sorry, was never much of a fan….;)

  153. Burrben – I didn't get the sense credit spreads were frowned upon here; risk is greater, but still defined, as is the profit potential.  Aren't credit spreads at the core of Peter D's strangle portfolio?

  154. stjeanluc…for the records, the prices on the PCLN  short strangle (next weekly) were,   645 put sold for 10.35   and the 670 call sold for 5.85… thx.  

  155. Me neither. Boyz & Noiz.  I prefer musicians who can play their instruments.  Nice tatoos, though.

  156. FTR :)

  157. 1020  -  Dude, in that video Tommy Lee looks like an alien sucked all the life out of him….

  158. See you all Monday.  Have a  great weekend!

  159. Hitchiker/Bolt – I knew that was too ironic to be true! 

    Iceland/Living – Certainly on my list, thanks.  

    Disaster hedges/Jrom – Yes, same as last week.  TZA nice and cheap at $20.45 so July $22/28 bull call spread at .95, selling anything for $1 against it (like USO Aug $29 puts at .90) gives a very nice upside but only if we really head down – it's true disaster insurance with a 5% deductible essentially.  

    Reporters/1020 – Yes, soon people will boo the President if they didn't vote for him.  It's democracy in action, right?  

    Squib/ZZ – Nah, just reminded me of it.  I think I could have explained to the kids they were eating people and they would not have been more grossed out.  

    Biden/Angel – Real twist of his words to get that headline.  Context was talking about which country puts investments into infrastructure and he's just making a point.  Another example of the sickness that American political press has become. 

    AAPL/Iflan – Or 30 seconds after you made that comment!  ;)  

    Wow, nailing those 5% markers into the close – that's a good sign, indicates follow-through is likely, especially with Dow, NYSE and S&P breaking over last few highs.  Won't take much stimulus to push us way up there.  

    Have a great weekend everyone – I've gotta run but plan on doing Income Portfolio post tomorrow.  

  160. FLAN/ PCLN:  Pricing on 670/645 at $39.30…. Correct???

  161. FLAN/ PCLN: sorry had July plugged in. Not weekly.

  162. boltdude –  It's more that Phil frowns upon them, and he for sure has some good reasons.  I think each strat has it's own merits in certain times.  Peter D's portfolio is using strangles, credit spreads, and vertical spreads all together.  Which makes it super interesting how he manages all the legs.  PSW is much more diverse than it was a year ago.

  163. Stimulus….LOL….there are a few stimulators that I know of…and… have a good weekend.

  164. byer bye FB!!!

  165. FB- 10% gain in 24 hrs…..whooda thunk.

  166. zero – me too. One of my favorites….

  167. PHIL / anyone – I sold calls against my FB shares, and FB closed .014 in the money.  What are the odds that they will be called away??  I will be in trouble with my sig.other if they get called away and FB rallies on Mon.  If they surely will be called away, I will buy now in AH. Help!

  168. FB/They are 1 cent ITM?  What month are your calls?

  169. FB/ I wouldn't worry too much at 1 cent. I think you should just be patient and see what happens this coming week.

  170. I was assigned once on a short put. I had the 25s, and the stock closed at 25.00. General rule is that you are ALWAYS assigned. I would be happy to hear of any exceptions.

  171. With Fidelity, they seem to exercise if it is 1 cent in the money at expiration unless you tell them otherwise I believe.

  172. Sorry Ryk – Mind is somewhere else today.  I would say that there is a high likelihood that you'll get called away.

  173. Inkarri19 / FB – the short calls were June.  I would buy in AH if I knew for sure, but don't want to end up doubling the position…  Rookie mistake for taking my eyes off the close for a sec…

  174. If you sold which I assume are the $30 calls, then you should have made a profit on them.  I would still wait until monday as the transaction probably won't show up until then at the earliest anyway.

  175. Thanks for the feedback folks.  I'll wait and see. Will be an interesting Sunday all around.

  176. Income portfolio at the close:

  177. This one is to get a conversation going with Phil:


    It's hard to believe but seven years ago this month, shares of (AMZN) and Best Buy were both trading within $1 of each other, around $37 per share.  Over the last seven years, though, the stocks have taken two entirely different paths.  Since then, AMZN has rallied close to 500% and is currently trading near $220 per share.  BBY, on the other hand, is down 47% and is trading at $20 per share.

    While the differences in the paths of these two retailers is noteworthy enough, it also provides a broader illustration of the evolving retail environment from bricks to clicks.  In 2005, online sales accounted for 6% of total retail sales.  Since then, the sector has increased its total share of sales by nearly 50% to just under 9%.  At the same time, electronics and appliance retailers have seen their share of total sales drop to 2.0% of total sales, which is the lowest reading since at least 1993.

  178. BIDEN: That is true his audience was a group of US mayors I still believe biden is a liability..romney will have an equally disastrous pick no worries!

  179. i just bought a new laptop at Best Buy and i might as well have been buying on the internet. the salesman was useless except to push insurance and maintenance programs. The only advantage is that i could walk in, see and compare and take it home.

  180. Savi

     Please count me in for Vegas- thanks for doing the work to set up the event.

  181. Not bad Peter with the full OpEx to go… Not too bad at all!

  182. Squib/Squab/Squid… Phil, share this with Tina and the girls and they might just get more grossed out… Squid Injects Woman's Tongue With Sperm Bag As She Eats In Korea

  183. stjeanluc…..I have a suggestion for the portfolio headings.   They should probably indicate the date the portfolio was started.  Otherwise there is no indication as to yield over time.     For instance, looking at the Peter Strangle Virtual Portfolio, I don't know if the P/L of $2,803.00 is over one year, one month, or one week.   A simple addition like 6/12 would show us that it was started in June of 2012.   Just an idea.  Thanks.  

  184. Good idea lflan. I'll add the date of the first trade in the header for the next update.

  185. scottmi/sperm  Ewwww….. thanks for the heads up there….scott….

  186. Happy Fathers Day to all the Dads!  :)

  187. Volume very heavy yesterday but no unexpected on expiration Friday.

  188. I have updated the volatility spreadsheet for next week and added the study for the July OpEx period:

  189. Yellowstone/Anybody -
    Driving this week from Vancouver, BC, to Northern Ontario via a US route – anyone have a reasonably priced, dog friendly, hotel recommendation in the NW corner of Yellowstone?  1st night will be in Coeur d'alene, ID, 2nd in Yellowstone, 3rd…?  Planning on driving through the Badlands via hwy 90 east… any other suggestions will be appreciated.

  190. Iran & Iraq looking for a way to counter low oil prices. Seems like nobody but "the Kingdom" likes $80 oil on the sell side.  This would make the price more unstable to the upside, perhaps.

  191. After having defeated the Russian at the Euro 2012, Greece might have to face Germany! Could be interesting….

  192. Michael Lewis at Princeton graduation, on "luck, and the responsibility it confers."

  193. Canuck: Nothing specific but this may help:
    Also, if you are coming from the N/W; consider a detour through Glacier National Park. The Road to the Sun is worth it. You can enter from the west and exit south towards Great Falls then to Yellowstone.

  194. Happy Father's Day to everyone concerned!

  195. Canuck,
    We stay at La Quinta Inns or Drury Inns with our lab.  Both are pet friendly(free) are under $100, clean and have free breakfasts.  La Quinta has the best beds of all hotels in my opinion.  Past the Badlands if you stay at Chamberlain SD (I-90) on the west side of the Missouri river is Cedar Shores Resort Hotel.  Very nice right on the river and dog friendly.  Enjoy your trip!

  196. Zero/ Michael Lewis & Luck – enjoyed that a lot…thanks for sharing!

  197. S&P Futures up close to 10 points at the open on Sunday… I guess they love that Greece election!

    French elections came out without a surprise – the left has a strong majority in parliament (no filibuster rule there anyway!)

  198. And oil is up $1.50…. 

  199. QE3/Omen???
    Went to the horse track today.  2nd race they had a horse named "My Bailout" – my bet was to Show but it won… 85% win in a few minutes, but what does it say about QE3, Bennie and the G20 this week.  Only time will tell.

  200. FB/Rky – It's my understanding you will be called away but so what?  Buy more stock, sell more calls and it they keep going up you make another Dollar for the month and another and another.  $1 is 3.3% a month on them – what on Earth is there to complain about getting called away?  

    Squid/Scott – Well if you boil it then it's hardly raw, is it?  

    Oil/ZZ – Back to $85 overnight.

    Markets only up about 0.4% now but no point in worrying about it.

    7:07 AM Greeks are voting for the second time in six weeks in elections that could lead to the country leaving the euro and the bloc breaking up. As far as the EU elites and investors are concerned, New Democracy and Pasok good, Syriza bad, with the outcome to close to call. A wildfire raging near Athens seems to provide an unfortunate but apposite backdrop, but at least the Greek soccer teamprogressed to next round of the European Championships.

    7:18 AM While the Greeks vote, the French do too, in the second round of elections for the lower house of parliament. President Francois Hollande hopes his Socialist party will win the 289 seats it needs for a majority, otherwise he might have to rely on the anti-austerity Left Front. That could pull Hollande's government further to the left and increase the divisions with Berlin.

    7:26 AM Polls in Greece close at noon ET, with results from exit polling data coming shortly after. The first vote projections are expected at 2:30 PM ET.

    12:03 PM Voting has ended in Greece and the initial exit polls show the race too close to call, with New Democracy (apparently good if it wins) at 27.5-30.5% and Syriza (supposedly bad if it wins) at 27-30%.

    4:24 PM Official projections show the establishment (pro-bailout) parties – New Democracy and Pasok - with enough seats to form a government in Greece. New Democracy is projected at 30.1%, Syriza at 26.5%, Pasok at 12.6%. Pasok indicates it will provide the votes to create a majority but will not take part in the government, reports Dow Jones. The euro is buying $1.2705 vs a Friday close of $1.2638.

    4:31 PM The Eurogroup gives its thumbs up to the election result and "looks forward to the swift formation of a new Greek government that will take ownership of the adjustment program to which Greece and the Eurogroup earlier this year committed themselves." The Troika is expected to return to Athens upon formation of the new government to "exchange views" on the way forward. (full statement, .pdf)

    The next time some pezzonovante talks about cutting off aid to Greece, find him and give him a smack. Of the €410B in "aid" to Greece over the past 2 years, JPMorgan estimates only about €15B has gone into the economy, the rest doing a 180 and going to creditors. German and French banks were the main beneficiaries of the first bailouts, now it's the ECB and the IMF.

    ECB chief Mario Draghi and EU top brass such as Jean-Claude Juncker are working on yet another plan to help save the euro. This one includes making the ECB the supreme bank regulatorinstead of the EBA, and as already discussed, creating a deposit insurance program to help prevent bank runs. 

    The G20, which is due to start a two-day parley in Mexico tomorrow, could agree to increase the IMF's firewall beyond the $430B agreed upon in April, Mexican President Felipe Calderon says. That's despite the U.S. and Canada not providing any of the funds. Other than that, guess what everybody will be talking about.

    Stiglitz: It’s no accident that Americans widely underestimate inequality.  We’ve been brainwashed (Salon)

    War or Revolution Every 75 Years. It’s Time Again. (Brave New World)

  201. Understanding the European Crisis

    By Barry Ritholtz – June 16th, 2012, 3:00PM

    Many of Europe’s
    Economies Are
    Weakening . . .

    . . . and Their Banks,

    Which Dwarf Their

    Economies, Are Hurting.

    With Many Countries

    Mired in Debt . . .

    . . . and So Many People

    Out of Work . . .

    . . . Hundreds of Billions

    In Aid Has Come Up Short.


    Source: NYT

  202. Good speech by Micahael Lewis.  

  203. I am hopeful that this rather muted market response [so far] to a Greek election victory by political parties that will support Dutiful Austerity will spike my U.S. longs while not crushing my short Euro hedge entirely, given me enough time to skeddadle before the whip comes down.
    They keep reminding us that Greece produces "a very small part of European GDP," from which one can presumably infer that nothing in Europe worth mentioning can be solved no matter whom the Greeks elect.  

  204. And as for Egypt, it's heartwarming to know that the optimistically-yclept "Arab Spring" has borne fruit in Egypt, where it's military council has issued a declaration permitting any new future President and legislature to exercise plenipotentiary powers in this cradle of Middle Eastern democracy, provided that these powers do not detract in the slightest from the ruling Military Council's ability to run the country as an independent entity, set its own budget, and control any and all proposed modifications to the Egyptian constitution. That should calm things down, I reckon. 

  205. Phil
    You mentioned late last week that you might have an update for the income portfolio.     Are we on hold until we see the market reaction tomorrow?

  206. zero – I will join u in that counter.  I will roll out and up on my puts, as the charts point to a top on the Euro and the dollar has or is close to bottoming.  The election, while sobering to some, means nothing…..there are bigger fish to catch…

  207. Interesting – virtual online gamer 'economies' mirror germany and greece.. observations from an economist hired to help them out.. "…what they were describing, the digital community they had facilitated into existence, was an economist’s dream-come-true. Think of it: An economy where every action leaves a digital trail, every transaction is recorded; indeed, an economy where we do not need statistics since we have all the data!"

  208. _"Believe me, that was harsh compared to the parade of JPM flunkies posing as Senators who stumbled over each other as they competed to see who could bend over backwards the farthest for Jamie Dimon,"
    These sycophantic toadies know that their next Inside Information tip will be hollered down a deep fracking well rather than whispered to them if they don't bend over forwards, AND provide Mr. Dimon with the cherry flavored K-Y.

  209. Here is the reason why Wall Street and CONgress will continue to mate like squirming annelida:
    During the followup on our TIVO'd  "60 Minutes",  'expose' of, particklerly, Nancy Pelosi's and Baucus's  'insider trading'  and CONgress's generally, the distaff side of the Flipster's household had this to say:
    "That's wrong". 
    I looked over at her and practically shouted, "Is that all you have to say about it?  Are you going to write your CONgresspeep and tell her about your opposition to this odious practice?? This further ripoff of YOU and your investments??"
    She told me to calm down and fast forwarded to the Taylor Swift's segment.  
    The APATHY by the voter (she still wastes her time and therefore ENCOURAGES the very people that she knows are screwing her)  even in the face of this continual Anal penetration  by the politicians of their own constituencies, is the single most controlling factor of why incumbents continue to live like Princesses, Kings, Queens, and Emirates and the middle classes are getting wiped out.
    Pogo, discovered and enshrined the source of our fate forever: "We have met the enemy……" 

  210. Phil
    Had a fantastic dinner at WD-50 in NYC on Friday. Thanks for the recommendation.

  211. Greece/ZZ – Still a distraction to Spain and Italy (whose notes are back over 7% this morning).  

    Income Portfolio/Den – Well we have the spreadsheet and I do intend to do a write-up but my family had other plans this weekend so I'll try to squeeze it in during the week.  Didn't have any particular trades since we had such a huge pop – I'm actually tempted to cash in a $7,000 win and go back to waiting with cash!  

    60 Minutes/Flips – System can't be changed from within. 

    That's great DC, glad you enjoyed it – I like that place. 

  212. Phil/”buy-writes” – When this term is used on PSW, does it generally refer to 1) buying calls and selling calls against them, or 2) buying stock and selling calls against it?