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TGIF – Can We Stop The Week Before Our Indexes Fail?

Look at the Russell!  

Look at the Nasdaq!  Are you seriously still holding onto your Dow, S&P and NYSE stocks?  That's exactly what people did in 2008, when they were so used to the markets being saved whenever they dipped, that they ignored all the warning signs – until it was too late.  

I know that I've been sounding like a broken record and you can call me Chicken Little but cut me a little slack as we are protecting profits here.  

We have 5 virtual porfolios we track for our Members and the $100,000 Butterfly Portfolio is up 19.4% ($19,000), the $500,000 Long-Term Portfolio is up 9.6% ($48,000), the $100,000 Portfolio is down 5.8% ($5,800), the $500,000 Income Portfolio is up 6.4% ($32,000) and our $25,000 Portfolio is up 15.4% ($3,850).  Overall, that's a gain of 8.8% on $1.225M deployed in 4 months.  

SPY 5 MINUTEThe Short-Term Portfolio is a hedge to the Long-Term Portfolio, so we haven't cashed those in but the Income Portfolio doesn't have an external hedge, so we moved to cash on that one last month (BEFORE the Nas and Rut started crashing off decade highs) and the Butterfly Portfolio is self-hedging while the $25KP has just one position left.  

Perhaps I'm wrong and the Nasdaq and the Russell will recover and the other indexes will all move up to new highs.  Even if they do, our worst case is we miss a bit of a rally.  If we're breaking out to new all-time highs from here – there will be plenty of money to be made.  BUT – if I'm right and the market drops 5-10%, then our taking 110% off the table at the top means that when we buy stocks again at 90%, we are buying 120% of what we could have bought had we not wisely cashed out in the rally.  

NDX WEEKLYThe REWARD for being cautious is owning 20% more shares if we're right, owning maybe 2.5% less shares if we're wrong or owning the same amount if the market stays flat.  It doesn't take a degree in statistical analysis to see why I prefer CASH!!! in an uncertain market like this one.  

Just because you have decided to trade stocks, it doesn't mean you have to trade them ALL THE TIME.  If you are a heart surgeon – you operate when there's a patient – you don't run around opening people's chests on the street.  If you are a lawyer, you don't run into court when there's no trail scheduled.  With any job – you do the job WHEN THE CONDITIONS ARE APPROPRIATE and, when they are not, you wait.  

Traders are very bad at waiting.  Investors tend to wait and learn patience.  Warren Buffet (and Arnold Rothstein) can go years without making a trade and then, when the time is right (as it was in 2009), he takes his pile of cash and engages in a flurry of activity – taking full advantage of a market correction.  That's exactly what we've done with our Income Portfolio – where we are re-deploying our cash to do some bottom-fishing already.  

For instance, we bought ABX at $18, got out at $21 and now it's $17.50 – so we'll buy it again!  We bought CLF at $16, got out at $24 and now it's $17 – so we'll buy it again!  TASR, IRBT, LQMT, TWTR – everything old is new again BECAUSE WE CASHED OUT!  We're even long on CMG now, a stock we were shorting earlier in the year.  Looking at the Russell chart, you can see what happend the last few times they failed the 200 dma – would you rather ride that down or have cash to go shopping with at the bottom.

It's very difficult not to trade and most people with my job aren't going to tell you not to trade because then you may wonder why you are subscribing to a stock market newsletter (and you can subscribe to this one right here).  I don't care because A) We're full and about to close Premium Membership and B) because our guys know we have lots and lots of ways to make money with our sideline cash – we just put on a different trading hat for a while.  

USO WEEKLYYesterday, for example, right in the morning post – FOR FREE – I told you that we LOVED shorting oil at $100.50 (/CL Futures contracts) and that you could make $2,000 on a drop to $98.50.  After the open, oil dropped to $100, for a $500 gain, then back to $100.50, then down to $99.80 for a $700 gain then back to $100.50 and then back to $100 overnight for another $500 gain and, this morning, it's back at $100.50 again.   We're still targeting $98.50 but, if they want to pay us $500 ten or twenty times along the way – we're OK with that too!  

I even talked about taking those $500 profit blocks right in the morning post.  We also talked about shorting the Futures at Dow 16,500 (/YM), S&P 1,870 (/ES), Nasdaq 3,550 (/NQ) and Russell 1,100 (/TF) and those made $500, $100, $500 and $1,000 so far.  

Again, this is just the stuff we're giving away!  cheeky

The TSLA trade I mentioned in the morning post yesterday that gave us a net credit of $8,350 finished the day at -$5,768, up $2,582 (30%) in just one day – this is why we don't fear having cash on the side – there's always something to trade – especially during earnings season.  

Not only that but Dollars are cheap right now – it's a good time to buy some!  


Have a great weekend., 

- Phil


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  1. Oil Lines

    R3 – 101.88
    R2 – 101.37
    R1 – 100.90
    PP – 100.38
    S1 – 99.90
    S2 – 99.39
    S3 – 98.91

  2. There has to be better ways to spend that money:

    If we take the low estimate of the distribution of these tax expenditures provided by the mortgage interest tax deduction figures, we find that the richest fifth of families will receive $181 billion in home owning subsidies this year. That is 2.25x more money than food stamp recipients received last year.

    Needless to say, this is a pretty ridiculous way to spend $248 billion to help people afford housing. If one were cynical about these things, one might even think that this is nothing but a giveaway to rich people.

    There are a long list of better ways to spend $248 billion on housing assistance. One better way would be to give it out universally so that everyone received the same amount of housing assistance. With a current population around 318 million, that would mean a housing assistance check of $780 per person. Thus for a family of four, that would be equal to $3,120 in housing assistance each year. Home owners could spend this money on their mortgages and renters (which is what most low-income people are) could spend it on their apartments rents.

  3. Why Comcast is bad for the Internet:

  4. Good article about inequality:

    Piketty concludes that we may soon reach a point in which social rent-seeking àl la marrying wealthy will be a far more effective path to prosperity than entrepreneurship. This is how capitalism dies—not with a revolution—but rather vitiated by rentiers, increasingly myopic and addicted like a junkie to the high of wealth accumulation. [...]

    The Koch brothers, who bankroll a large portion of the conservative dis-information machine are great examples. They claim to love free markets but in truth nothing terrifies them more. The freedom that they seek is the freedom to exploit the market power that their inherited wealth affords them. They use the political sphere to entrench the wealth inherited from their father. Piketty notes that the American tradition is one of high progressive taxation, especially on bequests, to prevent an American analog to European-style aristocracy. Even the patron saint of libertarianism, Robert Nozick, argued that an estate tax was fair, and suggested that, “taxes will subtract from the possessions people can bequeath the value of what they themselves have received through bequests.” Two generations of rentiers are rather enough.

  5. Re: IB and /TF.  I would give them a call.  I checked my market data settings and it says I pay 85/mo but in my cash transactions, I don't have that fee.  I have a note in email that says if you make 1 trade on the ICE in the calendar month it's only a $2 fee.  I'd call for a new acct to confirm.

  6. Phil- Oil has been above 100.50 all morning, so do you wait for it to fail that line or are you playing it short from here currently 100.90? Or are you resetting your line to short from 101?

  7. 100.95

  8. Mortgage Credits/StJ – A completely insane policy that also inflates the price of housing.  Just another way to make Banksters and the top 10% richer.  

    Oil/Craigs – When you see it spike up like it did earlier, you have to play cautiously (and Friday's in general are bad times to short) so yes, at $100.45 it's an entry with a stop at $100.55 and at $100.90 entry with stop at $101.05 and at $101.40, it's time to buy USO puts for the weekend instead.  

  9. Here's a new way to leak an M&A deal:

  10. FYI – I didn't realize that LINE pays Div's monthly.  I just got a program called TradingDiaryPro that downloads from IB and has a cash transactions section.  Just sayin…

  11. Good Morning!

  12. Netflix raising prices by $1/month; existing subs unaffected for 2 years • 9:05 AM

    Netflix (NFLX) is raising the price of its basic U.S. streaming service for new subs by $1/month to $8.99/month. However, an e-mail sent out to many existing customers tells them their prices won't change for two years.

    Netflix, only 3 years removed from the Qwikster debacle, stated last month it plans to hike prices for new U.S. and foreign subs by $1-$2/month (depending on the country) in order to finance more content spend. But it added existing subs will maintain their current pricing "for a generous time."

    With Netflix possibly on its way to having 70M+ global streaming subs in two years – it currently has 46.5M – a $1/month hike could yield over $800M/year in extra revenue by the time it reaches Netflix's entire base.

    NFLX -0.3% premarket.

    Read comments

  13. AAPL – I have to agree with cramer this morning. What was Apple thinking when buying Beats when HAR, though more expensive, could put an Apple in millions of cars?


    Tim Cook has not been impressive, to say the least….. :(

  14. …..hey let's be cool and pay 3B for some overpriced, crappy headphones….oh yeah….. :)

  15. WDC Short?

    May 8: Western Digital (WDC) has been forming a bear flag pattern below its 8- and 21-day EMAs that could lead to more selling pressure if it breaks below $82.50. The stock continues to have resistance at the $85 level for the past three sessions, which could be used as stop-loss level in this short idea. The first target could be the 200-day EMA at $78.

    BIDU Short?

    May 8: Baidu (BIDU) has been showing weakness as high beta tech stocks continue to be under pressure. The stock has been struggling around its flattening 200-day EMA and looks vulnerable for further downside once it breaks below the current weekly support of $148. Stops could be placed at the upper end of this weekly range at $165, with a target at $115 where the gap from July 2013 would get filled.

  16. beats
    ya, but the kids love them, regardless. they're join after millennials.
    but what do i know, i sold all my AAPL because I thought the iPad would be a flop ; >

  17. LQMT
    back up the truck – .18

  18. …what do kids know?….


    …Though I've often wondered if my wife can tell if sound is coming from two speakers or one…. ;)

  19. Nice little head-fake that failed already, game on for our shorting lines on Futures but super-tight stops as it's Friday (see post above).  

    Dollar 79.80 but now we (as shorters) have to worry that they can drop it down to reverse the drop in the indexes.  Should get a Dollar rejection here which will help the indexe futures at the usual 1,865, 16,400, 3,500, 1,090 anyway.

    Beats/1020 – It's a good demo for them to hook up with and $3Bn is nothing to AAPL.  Don't forget, they are getting to the point in the IPhone/IPad cycle where they will be dropping prices on some models, the way they did with IPod – so they want to hit the lower-income markets as well as young people and AAPL needs to stay cool because they're losing the schools to Chromebooks (because they are half the price).  

    BIDU/Burr – Where were you in the Fall when we were selling naked calls on them as they got near $200?  Probably still a good short but you never know with Chinese web stocks. If Alibaba has a home run, BIDU will pop too.  WDC also already sold off 15%, I hate to chase things.  

    LQMT/Wombat – Tasty.  Amazing there was no chatter about the patent filings.  

    AAPL $582.  TWTR, on the other hand, testing $33.  CMG bounce off $500 again.  

  20. Beats/1020- Beats may be crappy and overpriced, but they currently own 65% of the headphone market. But the real prize here is the streaming service they launched in January which has many unique features that will fit very well with Itunes and make apple radio a much better service. For instance beats has a feature where you describe your mood or where you are in a sentence and it will give you a playlist to match. My kids think it is very cool, and if I had invested in every fad my kids liked I would be a very wealthy man today. Using hindsight, they have always been a leading indicator of what will be hot. 

  21. ….I guess my kids aren't cool….


    …. or it could be that Pops has them listening to high end audio and are simply snobs…. ;)  

  22. Why technically AAPL buying beats doesn't make sense.

    1 They became cool when people discoverd they were better than in ear and it showed you cared about better sound with flasy look.

    2 They require extra power which AAPL devices don't provide. When turned up they distort.

    3 There are better sounding headphones now by very well known companies.

    4 All over the ear phones need an extra external amp with extra battery power.

  23. Chromebooks / Phil – You mean 1/4 of the price… Of course, you get what you pay for, but sometimes it's all you need!

  24. 5 They were designed for listening at home without disturbing others as with speakers. Those people are buying the better phones.

  25. Fad investing/Craigs – Yep, I'm always asking Jackie and her friends what they're into.  

    Wow, big whipsaw move back up already – what a joke of a market.  

    Beats/Shadow – I think the power issue is another reason AAPL is buying Beats.  They need to work with a headphone maker to make sure they can have high-quality devices that work well with good headphones – no one likes the ones they include.  AAPL likely has some design ideas that they don't want to give away to an outside manufacturer.  I know Jackie would love headphones that had a heavy battery pack on the wire that could also charge up the IPod.  Mostly the kids listen at home or at friend's houses – size and weight aren't the issue.  

    Chromebooks/StJ – In NJ and other states, they are going to begin standardized testing on Pads.  Nationwide, it's millions of additional sales and I don't think AAPL's going to get many at their prices – unless they can get old IPads below $149.  Stupidly though, in NJ, procurements are up to each local school.  

    Home/Shadow – Ah, you already knew that!  

  26. The USPS bleeds $1.9B in FQ2

    10:23 AM ET · FDX

    • The USPS reports it lost $1.9B in FQ2.
    • First-class mail volume declined 4.1% during the period while standard mail volume managed a 0.5% gain.
    • The agency reduced operating expenses by 1.1% Y/Y to $17.9B.
    • The meltdown at the USPS has some bearing on FedEx (FDX), UPS (UPS), Staples (SPLS), and (STMP).

  27. Skullcandy jumps following Apple-Beats report

    10:20 AM ET · SKUL

    • A report that Apple is set to acquire Beats Electronics for $3.2B is providing a lift to fellow headphone maker Skullcandy (SKUL +6%).
    • Skullcandy’s current market cap of $201.7M in a small fraction of Beats’ reported acquisition price. The company’s U.S. sales have been slumping due to tough competition from Beats and others, but international sales have been faring better.
    • Shares rallied last week following a Q1 EPS beat and healthy guidance, but quickly gave back their gains.

  28. No action in FX means bad results for FXCM

    10:18 AM ET · FXCM

    • It’s a second day of losses for FXCM (FXCM -4%) after Q1 results fell far short of expectations amid dismal volatility in currency markets. Net income of $2.1M or $0.05 per share fell from $6.9M or $0.23 one year ago.
    • CEO Drew Niv: “Volatility in the currency markets is currently at lows only seen twice in the past 20 years … We believe we have the scale to continue to weather the difficult trading conditions relative to our competition and use them to expand our market share for when conditions improve.”
    • Thus far in April: Retail customer trading volume of $250B is down 14% from March, down 32% Y/Y. Tradeable accounts of 192,605 is up 2% from March, down 2% Y/Y. Institutional trading volume of $185B is down 8% from March, up 1% Y/Y.
    • Previously: FXCM misses by $0.05, beats on revenue
    • Source: Press Release
    • Looking for some growth, the company purchases the U.S. retail forex accounts of FXDirectDealer – roughly $27M in client equity and 7K active accounts.
    • Source: Press Release
    • Sandler O’Neill downgrades from a Buy to a Hold.

  29. Concealment lawsuit against Wal-Mart moves forward

    10:16 AM ET · WMT

    • U.S. Magistrate Judge Erin Setser rules that a case filed against Wal-Mart (WMT) over its alleged concealment of issues with its operations in Mexico should move forward.
    • The company had filed for a dismissal.
    • Setser’s determination will be subject to a review from the district judge in the region.

  30. Goldman pulls SunEdison from Conviction Buy list

    10:14 AM ET · SUNE

    • Goldman’s move comes a day after SunEdison (SUNE -0.4%) sold off in response to its Q1 results, which were accompanied by an increase in the company’s solar project pipeline and a decrease in its backlog. Separately, Needham has cut its PT by $1 to $22.
    • SunEdison, beloved by David Einhorn, is down 22% from a March 6 high of $21.93, but still up over 3x from a 52-week low of $5.

  31. BE Aerospace offers may reach $140/share, analysts say

    10:13 AM ET · BEAV

    • As B/E Aerospace (BEAV -0.6%) studies options that may lead to a sale or breakup, analysts are predicting offers of up to $140/share, or almost 22x profit, which Bloomberg says would make it the aerospace industry’s most expensive takeover on record.
    • Valuation of the company already was rich – justifiably rich, given BEAV’s strong growth prospects – so the price tag likely would scare off P-E firms, analysts say, leaving only aerospace companies with hefty cost-saving potential to make the deal work.
    • BEAV’s options are limited in terms of buyers, says Biondo analyst Scott Goginsky, which “makes you wonder whether a breakup is more likely to be in the cards.”

  32. Virgin America and Southwest Airlines wait for decision out of Dallas

    10:10 AM ET · LUV

    • The fate of two gates at Love Field in Dallas could be determined today as City Manager A.C. Gonzales decides if Virgin America or Southwest Airlines (LUV -1%) lands the rights.
    • The issue is important to the carriers because next October a restriction on nonstop flights out of Love Field is lifted.

  33. Mar. Job Openings and Labor Turnover Survey (JOLTS)

    10:01 AM ET

    • 4.014M job openings, vs. consensus of 4.125M, 4.125M prior (revised)
    • Report

  34. Wholesale Trade rises 1.1%

    10:00 AM ET

    • Mar. Wholesale Trade: Inventories +1.1% to $525.2B vs. consensus of +0.5%, +0.7% in Feb (revised).
    • Sales +1.4% to $443.4B.
    • Inventory to Sales ratio at 1.18.

  35. Biotech technical outlook still bearish

    09:59 AM ET · IBB

    • The downtrend in the biotech sector that began on February 26 ain’t done yet. On a technical basis, (IBB +0.1%) has been trying to hold on to its wobbly base since its snap back move on April 15. Volume has dried up as the index struggles to stay above the key support level of the 200-day MA. This is not encouraging action for longs.
    • The relative strength line has dropped from a best-possible rating of 99 down to 68 with no upturn in sight.
    • Biotech investors should keep their powder dry until the money flow turns decidedly positive. Based on the chart, there is no indication that this is happening yet.

  36. Phil

    The at home listeners say Beats have too much base, that the kids love, but the biggest issues is they are uncomfortable for extended listening, correct size and weight don't matter comfort does.

    It only makes sense to realize the potential if an amp and battery pack was included. The shape doesn't fit over the ear properly and that word is out at least in the 30 year old public commuter class.

  37. Margin improvement at Gap helps to lift shares

    09:48 AM ET · GPS

    • Gap (GPS +3.8%) trades higher after releasing April sales tallies and FQ1 guidance.
    • The shift of Easter into April made the comp look a little overblown, but there’s no disputing that Gap’s margins are moving in the right direction.

  38. CBS in focus following Q1 report

    09:24 AM ET · CBS

    • Topeka Capital Markets trims its price target on CBS (CBS) to $70 after sizing up growth trends at the media company.
    • Analysts note that revenue growth at CBS is pinned tighter to broadcasting advertising than peers.
    • Shares of CBS are down 1.7% premarket to $57.00 after Q1 earnings.

  39. At the open

    09:32 AM ET

    • Dow -0.013% to 16530. S&P -0.12% to 1873. Nasdaq -0.37% to 4036.
    • Treasurys: 30-year 0%. 10-yr -0.06%. 5-yr -0.01%.
    • Commodities: Crude +0.57% to $100.83. Gold +0.3% to $1291.6.
    • Currencies: Euro -0.34% vs. dollar. Yen +0.12%. Pound +0.39%.

  40. UPS sizes up FedEx’s new strategy

    09:17 AM ET · UPS

    • The ball is in UPS’ (UPS) court after FedEx (FDX) announced an extra charge to customers for larger packages.
    • Though the company has a history of matching its rival’s price hikes, this time around could be different with it already indicating is has no plans for “dimensional” pricing.
    • The wildcard in the mix is how Amazon will look at FedEx’s new pricing structure. UPS may take a wait-and-see stance.

  41. /cl over 101, looking at yesterdays high.  Hoping to short below 100 on a cross.

  42. Buffalo Wild Wings lower with Buckingham Research on the case

    09:42 AM ET · BWLD

    • Buffalo Wild Wings (BWLD -0.9%) trades lower after Buckingham Research initiates coverage with an Underperform rating.
    • The investment firm has a $116 price target on shares which reps a sell-off of 18%.
    • Buckingham has a decent reputation of turning bearish on momentum-drive stocks just ahead of the stampede (LULU call vs. chart).

  43. Big miss for Canadian jobs in April

    08:42 AM ET · FXC

    • The loonie heads south as Canada reports a loss of 29K jobs in April vs. expectations for a gain of 12K. March saw 42.9K jobs added.
    • The unemployment rate is unchanged at 6.9%.
    • The Canadian dollar is currently buying $0.9190, down 0.5% on the session.
    • FXC -0.4% premarket

  44. Twitter gets its second upgrade in two days

    09:39 AM ET · TWTR

    • A day after Morgan Stanley upgraded Twitter (TWTR +0.4%) to Equalweight in response to its huge selloff, BofA/Merrill has upped shares to Neutral. Its PT remains at $36.
    • BofA’s Justin Post likes the fact Twitter added 14M MAUs in Q1, up from an underwhelming 9M in Q4, and is upbeat about Twitter’s extensive efforts to improve ad monetization. He thinks revamped apps, site changes, and new features could all provide a lift.

  45. William Lyon Homes +5.5% as home prices surge

    09:02 AM ET · WLH

    • Home sales revenue of $140.3M (up 84% Y/Y)
    • Adjusted gross margin of 27.6% (up 440 basis points)
    • New home deliveries of 276 homes (up 3%)
    • Average sales price of $508.3K (up 78%)
    • Net new home orders of 400 (up 11%)
    • Dollar value of orders of $199.2M (up 51%)
    • SG&A expense of 13.3% (down 400 basis points)
    • Adjusted EBITDA of $20.3M (up 342%)
    • Dollar value of backlog of $264.8M (up 55% and translates into ASP of $538.2K)
    • CC at 12 ET
    • Source: Press Release
    • Previously: William Lyon Homes beats by $0.14, beats on revenue
    • WLH +5.5% premarket

  46. Polypore +7.7%, inks long-term lithium separator supply deal with Panasonic

    09:12 AM ET · PPO

    • Polypore International (PPO) +7.7% premarket after announcing a five-year lithium-ion separator supply agreement with Panasonic (PCRFY), and authorizing a repurchase of up to 4.5M common shares.
    • Q1 results were mixed, however, with earnings falling short of expectations but revenues rising 10% Y/Y; sales of lead-acid battery separators rose 4% while lithium battery separator sales jumped 23% due to higher volumes in electric drive vehicles.
    • DA Davidson upgrades shares to Buy from Neutral and raises its price target to $42 from $36, citing PPO’s flexibility to increase capital investments in strategic growth opportunities through the recent debt restructuring and subsequent lower interest rates.

  47. Plug Power +8% on fuel cell deal with Central Grocers

    08:27 AM ET · PLUG

    • Plug Power (PLUG) +8.2% premarket on news retail co-op Central Grocers ordered 182 GenDrive fuel cell units to operate its electric lift truck fleet at its Joliet, Ill., facility, and signed a service contract with PLUG for the GenDrive fleet.
    • Central Grocers has been operating GenDrive as the sole power source for its class-2 and class-3 lift truck fleet at the facility since 2009, and the new units will replace the original fleet.

  48. More on Apple: iPhone 6 launches reportedly set for August/September

    08:45 AM ET · AAPL

    • Supply-chain sources tell Taiwan’s Economic Daily News (hit-and-miss with product launch reports) a 4.7″ iPhone 6 (AAPL) will arrive in August (a month earlier than expected), and that a 5.5″ or 5.6″ model will launch in September. The paper adds 80M iPhone 6 units will be produced this year.
    • There have been plenty of reports stating Apple plans to launch 4.7″ and 5.5″ iPhones, with some adding the latter will arrive later than the former. There have also been reports stating Apple is looking to charge a premium for a bigger iPhone. The Street has been enthusiastic about the potential of the phones to win back share lost to large-screen Android devices.
    • iPhone audio codec/amplifier supplier Cirrus Logic (CRUS), believed to get over 2/3 of its sales from Apple, could benefit if the rumored launch schedule is accurate.
    • Earlier: Video appears to confirm Apple-Beats

  49. India soars nearly 3% on election hopes

    09:27 AM ET · IBN

    • Investors are placing bets ahead of next week’s election results which are expected to show a win for the opposition party’s Narendra Modi and the worst-ever defeat for the ruling Congress Party amid a wave of graft scandals, rising inflation, and slowing growth.
    • The Sensex – up 2.9% last night – is ahead by 17% since the opposition BJP party named Modi as its PM candidate last September.
    • Leading last night’s advance was ICICI Bank (IBN +5.2% premarket). HDFC Bank (HDB +2.9% premarket)

  50. Ralph Lauren beats estimates but investors dig deeper, shares -5.9%

    08:25 AM ET · RL

    • Ralph Lauren (RL) beat estimates with its Q1 report, but underneath the hood things don’t look all rosy.
    • Segment revenue growth: Wholesales +24% to $983M; Retail +5% to $845M.
    • Consolidated comp sales growth was 2% lower with the start of the spring season in North America lagging.
    • The retailer’s gross profit rate sank 190 bps to 57.9% due to F/X changes and a change in mix tied to the integration of Chaps.
    • Guidance for 2015 from the company is well-below the consensus estimate of analysts.
    • RL -5.9% premarket

  51. Obama photo op at Wal-Mart goes sideways

    08:12 AM ET · WMT

    • A plan by President Obama and Wal-Mart (WMT) to publicize the company’s commitment to use solar energy technology has gone sideways after labor advocates seized the moment to throw a spotlight on Wal-Mart’s wage structure.
    • Criticism from union officials aimed at Wal-Mart has overshadowed some of the coverage on the retailer’s effort to conserve energy through its solar initiative.
    • Even staunch Democrats are taking on Obama and Wal-Mart for the photo opportunity. Former Labor Secretary Robert Reich leads the charge in that area: “What numbskull in the White House arranged this?”

  52. Video appears to confirm Apple-Beats; Iovine reportedly set to join Apple

    07:57 AM ET · AAPL

    • In a Facebook video posted by actor Tyrese Gibson, Beats co-founder Dr. Dre appears to confirm (with colorful language) his company is getting bought by Apple (AAPL) for a large sum.
    • Separately, the NY Post reports Beats’ other co-founder, music industry legend Jimmy Iovine, is in talks to join Apple as a creative “special adviser” to Tim Cook.
    • Questions are flying about Apple’s intentions for Beats, and whether the deal represents a big strategy change. While Apple has bought plenty of component, software, and services firms over the years, it has shied away from acquiring established electronics hardware brands in favor of a do-it-yourself approach. Also, audiophiles generally aren’t huge fans of Beats’ headphones.
    • At the same time, Beats, as a consumer brand known for premium pricing, a loyal customer base, and simple/iconic design, has more than a few things in common with Apple.
    • Music industry sources tell re/code Beats is doing over $1B/year in sales. The site also speculates Apple is interested in Beats’ streaming service – Billboard reported in March Apple is talking with labels about a subscription streaming service, and is thinking of offering an iTunes Android app.
    • Apple -0.4% premarket. Pandora (P) -3.2%; the company is no stranger to selling off on reports of Apple music forays.

  53. Flat comp growth at Bloomin’ Brands

    07:48 AM ET · BLMN

    • Bloomin’ Brands (BLMN) reports flat comparable-restaurant sales growth in Q1 on lighter traffic trends.
    • Comp growth by concept: Outback Steakhouse +0.8%; Carraba’s Italian Grill -1.8%; Bonefish Grill -1.5%; Fleming’s Prime Steakhouse and Wine Bar +1.7%.
    • Restaurant-level margin fell 40 bps to 18.0% due to higher costs and commodity inflation.
    • The company sees FY14 EPS of $1.21 off of a 1% to 2% gain in comparable restaurant sales.

  54. Party at Carlyle over Beats sale

    07:34 AM ET · CG

    • Carlyle Group (CG) is up 3% premarket amid the rumored $3.2B sale of Beats Electronics to Apple. At that price, the P-E firm would more than triple its investment of $500M made less than one year ago.

  55. U.K. Deputy PM wants “binding” assurances from Pfizer over AZN deal

    07:18 AM ET · PFE

    • U.K. Deputy Prime Minister Nick Clegg says that the pledges that Pfizer (PFE) has made to the British government in connection with the company’s proposed takeover of AstraZeneca (AZN) need to be “binding.”
    • Pfizer has promised to complete AstraZeneca’s new R&D center in Cambridge if the deal goes through, keep a factory in Macclesfield, and ensure that 20% of the combined company’s research staff are located in Britain for at least five years.
    • The government’s focus is that “jobs are protected, research is protected, excellence in science is protected,” Clegg says.
    • It’s worth noting, though, that Clegg is from the Liberal Democrats, the minority party in the coalition government, so his influence may be limited.

  56. U.K. industrial output slips, trade deficit narrows

    05:13 AM ET · EWU

    • U.K. industrial production -0.1% on month in March vs +0.8% in February and consensus of -0.2%. On year, output +2.3% vs +2.5% and +2.4%.
    • Manufacturing production +0.5% on month vs +1% and +0.3%. On year, output +3.3% vs +3.9% and +2.9%. (PR)
    • Total trade deficit £1.28B vs £1.71B in February.
    • Goods trade deficit £8.48B vs £8.75B in February and consensus of £9B. (PR)
    • The pound slumps from earlier highs and is -0.15% at $1.6907, while the FTSE 100 is -0.4%.

  57. ArcelorMittal core profit climbs 12%

    05:00 AM ET · MT

    • ArcelorMittal’s (MT) EBITDA rose 12% to $1.75B in Q1 and met analyst expectations, while revenue edged up 0.2% to $19.79B.
    • The steel-maker’s net loss narrowed to $205M from $345M a year earlier, with the latest figure affected by $1.08B in depreciation and amortization, net interest expenses of $426M and losses from currency fluctuations and other financing charges of $384M.
    • Steel shipments rose 21% and marketable iron ore shipments 28%, offsetting a fall in ArcelorMittal’s average achieved steel and iron-ore selling prices.
    • Net debt increased to $18.5B from $16.1B at the end of December, but the company reiterated its target to cut the figure to $15B in the medium term.
    • The firm also reaffirmed that it expects 2014 EBITDA to grow to $8B from $6.89B last year, but it increased its 2015 iron-ore production target by 11M tons to 95M tons.
    • “The prospects for growth of our core markets in Europe and the U.S. are encouraging and overall we remain cautiously optimistic about the business outlook for the rest of 2014,” ArcelorMittal CEO Lakshmi Mittal said.
    • Still, the company reduced its 2014 growth outlook for global steel consumption to 3-3.5% from a previous forecast of 3.5-4% and vs last year’s increase of 3.5%. The firm expects weaker steel demand in Russia, Ukraine and emerging markets such as China.
    • Shares are -2.3% in Amsterdam. (PR)

  58. Telefonica’s Q1 profit falls 23%, shares tumble

    04:24 AM ET · TEF

    • Telefonica’s (TEF) Q1 earnings missed analyst expectations as net profit slumped 23% to €692M ($957.5M), hurt by forex turmoil in Latin America, declining revenues, and the sales of the telecom carrier’s Czech business last year.
    • Revenue fell 14% to €12.2B, with sales in Spain dropping 8.2%, in Germany 8.8% and in the U.K. 0.3%. In Latin America, where Telefonica has two-thirds of its customers, revenue tumbled 18% in Brazil and 13% in the rest of the region.
    • Operating income (OIBDA) dropped 14% to €3.93B.
    • Telefonica reiterated all of its operational and financial guidance for 2014.
    • Shares are -3% in Madrid. (PR)

  59. Italian industrial production falls vs expectations for growth

    04:09 AM ET · EWI

    • Italian industrial output dropped 0.5% on month in March after falling 0.4% in February and missed consensus for a rise of 0.3%.
    • On year, production -0.4% vs +0.4% and +1.2%.
    • The FTSE MIB is -0.6%.
    • Web site of the National Institute of Statistics.

  60. Alcatel-Lucent Q1 loss drops by almost 80%

    03:42 AM ET · ALU

    • Alcatel-Lucent’s (ALU) Q1 net loss narrowed to €73M ($101M) from €353M a year earlier, helped by lower costs and an 11% increase in revenue at the telecom-equipment company’s Internet-routing division.
    • Losses per share dropped to $0.03 from $0.16.
    • Revenue fell 3.3% to €2.96B, mainly because of the increase in the euro vs the dollar and a 50% fall to €99M at the firm’s managed-services business. Internet-routing sales +11% to €549M, wireless-network fell slightly to €999M.
    • Alcatel-Lucent swung to an adjusted operating profit of €33M from a loss of €179M and beat expectations for break-even.
    • Free-cash flow loss €398M vs €544M, adjusted for discontinued operations.
    • Alcatel-Lucent remains on track to sell €1B in assets.
    • Shares are +3.4% in Paris. (PR)

  61. Chinese CPI moderates, PPI drops again

    03:02 AM ET · FXI

    • China’s inflation slowed to an 18-month low of 1.8% on year in April from 2.4% in March and came in below consensus of 2%
    • On month, China’s CPI fell 0.3% vs -0.5% and -0.1%.
    • Factory-gate prices (PPI) dropped for the 26th consecutive month, declining 2% on year vs -2.3% previously and forecasts of -1.8%. The deflation demonstrates that “overcapacity remains relatively serious,” the People’s Bank of China said recently.
    • With other data indicating that China’s economy is slowing down, economists attributed the fall in CPI to a weakness in demand. Today’s data has increased expectations that the government will further ease monetary and fiscal policy.
    • “It’s time for the People’s Bank of China to cut the reserve requirement ratio,” says ANZ economist Liu Li-Gang, adding that the risk of deflation is increasing. At the moment, major banks have to keep 20% of their deposits at the central bank, thereby restricting their lending abilities.
    • The Shanghai Composite is -0.2%.

  62. German trade surprisingly falls

    02:09 AM ET · FXE

    • Germany’s exports fell 1.8% on month in March after dropping 1.3% in February and missed forecasts for a rise of 1%.
    • Imports declined 0.9% vs +0.4% and +0.5%.
    • The trade surplus slipped to €14.8B from €15.8B and missed consensus of €16.6B.
    • The current account surplus increased to €19.5B from €13.8B.
    • The euro gives back earlier gains and is flat at $1.38349, while DAX futures are +0.1%. (PR)

  63. FedEx is shaking up the shipping game in charging by package size

    Yesterday, 07:20 PM ET · FDX

    • FedEx (FDX) is changing the way it charges to ship bulky packages; instead of charging by weight alone, all ground packages soon will be priced according to size, which effectively will raise prices on more than a third of its U.S. ground shipments.
    • Such a move would greatly affect bulky but lighter weight items like toilet paper and diapers, but the changes also would profoundly affect Web retail shoppers, who often buy multiple clothing or footwear items – perhaps with free shipping – then keep what fits and return the rest.
    • For Amazon (AMZN) and other big online retailers, shipping is already one of the biggest and most rapidly increasing costs; e-commerce retailers likely would be affected by differing degrees, with the biggest companies such as Wal-Mart (WMT), Walgreen (WAG) and Saks (SKS) having advantages in their ability to negotiate pricing with FDX.
    • UPS has not yet followed FDX’s move, but the two companies historically have matched each other’s price increases.

  64. Columnist: Did 60 Minutes whitewash the 2010 BP oil spill?

    Yesterday, 06:20 PM ET · BP

    • Did 60 Minutes whitewash the Deepwater Horizon oil spill?LA Times columnist Michael Hiltzik poses after BP scored a largely sympathetic 60 Minutes segment this past Sunday which “parroted” its complaints that many businesses have been pocketing settlement checks based on fraudulent claims.
    • “Today’s 60 Minutes seems more inclined to view the little guy as a born scammer,” Hiltzik laments, and rips CBS correspondent Scott Pelley for speculating that claimants refused to be interviewed “because they’re feeling sort of sheepish about receiving that check.”
    • Of ~288K claims thus far, 69K claims totaling $5M have been approved, 54K have been denied with the rest pending, incomplete or withdrawn, according to settlement administrator Patrick Juneau’s office.

  65. Winklevoss twins pick Nasdaq for bitcoin fund

    Yesterday, 06:15 PM ET · BITCN

    • Brothers Cameron and Tyler Winklevoss disclose that they’ve chosen to list Winklevoss Bitcoin Trust (BITCN) on Nasdaq, as the fund slowly moves toward public approval.
    • “The fact that the S.E.C. has allowed the S-1 to progress this far is an indication that it may actually happen,” says Wedbush’s Gil Luria.
    • The fund would buy one Bitcoin for every five shares; management fees are as yet undecided.
    • The brothers’ own index was valuing a single Bitcoin at $443 today.
    • Previously: Report: Prospects for Winklevoss Bitcoin ETF approval look good

  66. Think tank says investors should weigh risks of big high-carbon projects

    Yesterday, 05:58 PM ET · PBR

    • Large oil companies are betting more than $1T on large-scale, “high-risk” projects over the next decade, and investors should question the assumptions underpinning that spending, urges the Carbon Tracker Initiative.
    • The think tank advises oil investors to require annual stress tests of oil companies’ sensitivity to a low-price scenario, and to ask what demand and price assumptions underpinned companies’ spending strategy, as some major pension funds already have begun to do.
    • Among companies with the highest exposure to such high-risk projects, as measured in dollar terms, are Petrobras (PBR), Exxon (XOM), Rosneft (RNFTF), Shell (RDS.A, RDS.B) and Total (TOT), the CTI says in a new report.

  67. Silver Wheaton EPS in-line, misses on revenue

    Yesterday, 05:12 PM ET · SLW

    • Silver Wheaton (SLW): Q1 EPS of $0.22 in-line.
    • Revenue of $165.4M (-19.6% Y/Y) misses by $20.71M.
    • Press Release

  68. Universal Display +10.8% AH on Q1 beat, guidance hike

    Yesterday, 04:59 PM ET · OLED

    • Universal Display (OLED) now expects 2014 revenue to “reach the high end” of a prior guidance range of $190M-$205M; the consensus is at $199.2M.
    • Materials sales (93% of revenue, given Samsunng licensing payments arrive in Q2 and Q4) rose 38% Q/Q and 176% Y/Y to $35.3M. Materials gross margin (closely watched) rose 220 bps Q/Q and fell 370 bps Y/Y to 72%.
    • R&D spend rose 14% Y/Y to $10.2M, and SG&A spend 24% to $6.4M.
    • Shares had fallen over the last six weeks due to a tech stock selloff and Samsung-related concerns.
    • Q1 results, PR

  69. AAPL/ Beats

    I think there may be some synergy potential with Beats Music & I Tunes.

    $ 10 monthly for online music sharing with 3 devices seems pretty good to me.

  70. Phil I really like the new color for news, thanks.  

  71. Good morning Phil, wanted to ask, do you have an opinion about Goldman Sachs at this point?  I know they're the vampire squid and all that, but seem to be hovering around long-term support, with a PE of only about 9-10 or so, maybe they will benefit from increased M&A activity, increased market share in the trading business?  Or maybe in the general weakness, hold off until around $140?


  72. A UPS wisper is revinue is way down for individual shipping like the returns, they end up USPS. The big shippers demand special pricing and that squeezes margin. Fed Ex is addressing it as those same big shippers are filling up their trucks with low margin packages as they pay by weight per trailer full. Small shippers like on eBay are almost all USPS. When profits are down the smart guys look at why.

  73. DLR – great finish to a good week

  74. third times a dream on ES?

  75. Potential/Shadow – Of course an amp but you have that whole wire you can hang things off.  An amp doesn't way anything, just the batteries but you can make a line of those down the cord (or maybe make a cord like a guitar strap) and that solves the biggest concern these kids have – that their phone will run out of power.  These kids go into withdrawals just seconds after their phones die…

    Oil/Burr – It's just not a good short into the weekend.  USO safer to play.  June $37 puts are .93 with oil at $36.70 so about .63 premium for 42 days means it costs 0.015/day to hold them and the delta is .55.

    Beats Music/Randers – That's definitely something AAPL needed to do anyway.  

    By the way, guys, AAPL has a p/e of 14 and Beats isn't some internet start-up with no profits they are overpaying for.   As long as they can see their way clear to making $200M per year (they have $1Bn in sales now), then this acquisition costs them net nothing in the not very long run.

    You're welcome Cturb.  

    GS/Pwright – Well, they got way too expensive at $180 but they are also essentially bullet-proof, so I wouldn't bet against them.   Betting for them is tricky as it's like betting on Hydra to take over the World – hopefully they won't but, just in case, may as well cover your bets.  I like JPM better but, on the whole, I like my FAS shorts best of all as I think all that good news is already anticipated and disappointment lies ahead.  If not for the IBanks, then the juniors.  

    UPS/Shadow – As an AZMN prime customer, we get low-weight packages all the time.  AMZN is going to have a big problem if UPS and FDX change their deals or maybe they'll be in trouble if AMZN contracts a better rate with the post office.  

    DLR/Scott – Wow!  

    Pressure on the indexes still looks down to me.  

    Oil coming down nicely from that $101 test.   Below $100.75, so that's the stop on /CL now

    Dollar 79.88 – gotta love that CASH!!!

  76. Phil thanks re: GS

  77. Phil// Where do you see the floor for AAPL?  Thanks.

  78. Phil

    I'm curious why is DX so strong today?  

  79. Phil – I'm taking the /CL Jun 101 puts for .95c instead of USO puts.  Same delta. More trading hours.

  80. You're welcome Pwright.  If you want to get them bullish.   I'd wait for an overreaction on some bad news.

    AAPL/Rookie – They'll go down if the market dives, could go back to $450 but I doubt $400 – either way it's a BUYBUYBUY on any good dip.  

    Dollar/Chuck – Because Draghi said crazier things than Yellen did yesterday.  As I said yesterday, she's out of ammo – Draghi has talked a big game so far but hasn't actually done much easing so now, if he starts while she's stopping, he can knock down the Euro quite a bit.  

    Good idea Burr.  

  81. Regarding indices.  I have Cummulative delta longs from the first visit to 1863 still holding following subsequent tests, of about 10,000+ contracts.  So that looks like it might hold and is likely accumulation.

  82. @Burrben, another advantage of /CL puts, is taxes.

    They are considered '1256' and it means:

    1. even if you day trade – they are 60% long-term capital gain/loss / 40% short

    2. In taxes you don't have list all individual trades

    3. Some losses may be carried back 3 years


    4. you have to mark-to-market at the end of the year.

  83. lol730 – Thanks.  I'm new to options on futures.  So I'm looking at the contract desc for the Jun 101p's and IB says that they expire on May15 at 14:30est.  Do you know if that's correct?

    So if I wanted to trade a option that expires in June, I'd have to trade the July futures?  

    Last question, are the option prices based on the front month future?

  84. Phil – do you still have a list of "crash insurance" Puts?  They were cheap way-out-of-the-money Puts to buy in case of a big pullback.  I am sure AMZN was on there…already short them though

  85. Burr /  CL FOP  Same as the futures, July options based on July futures which both expire in June but on different days.

  86. One week to go on the strangles options:

    Looks like another $4K in the bank this month, about average for the portfolio.

  87. /CL futures options are expired 3 business days before futures. Although they write expiration time 14:30EST – in fact it's end of trading time and expiration(and assignment) around midnight. So if your options close to money – it may get into money afterhours.


    BTW /ES has weeklies and end of month, but also options that expires on the same date as /es expires. And those expire at the end of regular hours, but settlement is based on later time (I think midnight – don't remember). So again – if you are close to money and there is big move afterhours – you may not have chance to adjust. For that reason I never trade those, only weeklies and monthlies, so I have opportunity to roll

  88. lol
    yes, thats why I never hold past the 'options' date expiration. too risky.

  89. NG / Phil:

    NG is in the lowest point in a month do yoou think is a good long for weekend?

  90. there goes /CL

  91. Phil,

      Both CLF and SPLS look to me like good candidates for covered calls in an IRA. What do you think? Any other candidates from the many fertile minds here would also be greatly appreciated.

    Thanks in advance.

  92. Breaking with GOP, Romney Backs Minimum Wage Hike


  93. Burr / CL Fop
    THANK YOU, $800 IN 5 MINUTES.!!

  94. Rolling SPY May Calls 190s to May5 Call 192s and Doubling down.  Bought them for 51c (50 of them), so

    51c*50 contracts + 9c*50 contracts = 60c * 50 contracts.  Doubling down reduces price by 1/2, so 45c average price (I think my math is right)…..

    SGEN – I am holding the May $35Ps STO.  I think they expire worthless.  I am holding the June 35Ps STO, and selling some Sept $25s Ps for 1.15 or better.  Everything else stays the same. 

    CLDX – selling some $10 Sept Ps.

    IMGN – nothing.  I like SGEN better.

    CRIS – selling $5 calls if possible.

    PLX – $7 calls selling any month someone will buy them.  1/2 sale of those

  95. qcmike Romney

    The reason is unmentionable and he was for public healthcare until it was policically incorrect in his party.

  96. Pharm, thanks for the update.

  97. And up we go again – very bouncy today.   Oil down though, heading back to $100. 

    Crash insurance/Cdel – If you remind me over the weekend, I can look some over.  I've been more in bargain-hunting mode lately as I don't think we'll dip more than 10% at most, maybe just 5% (from here).  

    Very nice on strangles, Peter.  

    /NG/Advill – No, it's at the lowest point in the month because demand was disappointing and they are running out of days that might be cold – I'd stay away.  

    SPLS/Kevin – I'm not too wild about them with ODP closing 1/3 of their stores.   I don't know if it will help SPLS or maybe they will have to now bow to the same pressure to compete.  Either way, it's an indication the sector is hurting, so not for me.  I knew they were in trouble when they began putting 3-D printers on the floor – that just meant people weren't buying the usual stuff and they were getting desperate.  CLF, of course, I always like down here.  

    Romney/QC – Is he still in politics? 

    Very nice Advill. 

    Good list Pharm.  

    Looks like we're topping out at 1,100 on /TF again.  16,532 on the Dow is strong, 1,872 on /ES and 3,542 on /NQ and oil bounced off $100 (now $100.13) with the Dollar 79.88.   

    /RB can be played long over $2.90 (now $2.9033). 

  98. Why buy contracts that are OTM and high risk.  Well….I think we get an overthrow of the top…everyone is talking seasonality right now, and algos will take advantage of it.  Notice how we have been bouncing b'w lines since the beginning of the year.  Chart is from Pretzel's set, but we are range bound.  The longer the range bound continues, the BIGGER the breakout will be….I am using Bulkowski and several other sites for that assumption.  I may be wrong, but for now, with the Fed still in play, more likely there is a few more pops.

  99. Phil,

    Do you think FUEL is a good buy at these levels? Rev of 400mil with market cap of 740mil. No profits. but who cares about profits :-)

  100. Phil Romney

    Idaho is in primary and every other ad has him indorsing his pet politicians, religiously connected to a church in a place where he is god.

  101. Very good article about signs of a tech bubble – now they are bribing reporters with "friend and family" round shares:

    At the outset of this post, I wrote that I was merely surprised by this slimy suggestion that it'd be okay for a journalist to buy into the IPO of a company he has covered. That's because, as with so many of the telltale signs of a bubble, I have seen this before. During the dotcom boom of the late 1990s and early aughts, a colleague of mine at the San Jose Mercury News got into hot water for accepting a "friends and family" share allocation. (She contended that the CEO who offered her the shares was indeed a friend. I had and have no reason to doubt her assertion, which was and is beside the point.) When times are so good that executives are willing to disregard the difference between ethical and unctuous behavior, it's just one sign that the end, relatively speaking, is near.

    FUEL/Harip – Gosh, I've been saying not yet on them since $50, now they're $20 and I'm still not sure.  I'd make sure they actually recover a bit first because, strangely enough, people are starting to expect some kind of earnings from these companies.  

    Romney/Shadow – I hope you have Tivo, so you can skip him.  

  102. Check out how they ramped up TLT into this week's auctions and then immediately let it drop back off.  If our own Government blatantly manipulates things like this – how can we expect them to regulate GS, JPM, et al?  

  103. Pharm / SPY Calls,

    Can you elaborate the roll that you did? did not get it completely? Just flowing that trade in my paper account and want to better understand the roll.


  104. Phil – /CL "not a good short into the weekend"  

    #smileyface #scarcasticwink #mydaughterjustgotanewpairofshoes

  105. Math/Pharm – on those SPY calls.. If I read your purchases right, you have $3000 expended for 100 contracts.. so 30c average cost.

  106. Ok. I am currently short AMZN, WYNN, CMG, CAT, MA via Put spreads and/or synthetics.  Just flipped to bullish on GOOGL and PCLN

  107. Math – nevermind. missed the roll out/up part.

  108. Phil

    Have no TIVO and can't say how much I look forward to the end of the primary. Somehow Koch brothers think Simpson is too liberal and the chruch thinks Smith is a ruthless debt collector. I can't see how this can help the GOP. The demo is a former senitor that doesn't even bother to advertise, if he wins the election it may spread to many red states. Since W ran I can't believe I ever voted for any of them starting with Reagan who started the banking mess. In 2012 I voted in the WY GOP primary to vote against the worst knowing they would win all anyway, waste of time. Barrasso was the worse.

  109. I'm looking at rolling my June STX 52.5/57.5 BCS to $49 calls for $1.30 (rolling cost).

    Does that look like a decent deal or is there a better position or should I just continue to leave it alone?

  110. re: SGEN, for some reason my short Jan 2016 25 puts have gone up $.85 on a day when SGEN is up $1.25.  Making my P&L look bad :)   But can get $4.35 for those now if the chart is right, in case anyone interested

  111. /CL puts – Burr/Lol730.. thanks for getting attention back to these, and especially info about the 1256 classification. Missed the play today but this is definitely a vehicle I am ready to explore!

  112. Shadow

    Where in Wyo?

  113. The use of killer robots will be debated for the first time at the United Nations Convention on Certain Conventional Weapons.

    Read more:

  114. Wow – I got quotes on my quote – no idea how I did that!

  115. buster

    On the west side of the Tetons 1/2 mile from Idaho, other than WY public radio all I get is ID!. Are you in WY?

  116. UNP/pwright – and the premium burn has put the trade back in the black. can close out if cold feet. I'm going to let the may2 190 expire, then look to write a may 190 or 192.5 on Monday, depending on where the stock is after the weekend. If concerned about drop, roll to may 190 today to have the cover over the weekend. Stock is still in uptrend IMHO

  117. Was raised in Lander.  Now reside in Albuquerque.  Cut my teeth on the heavenly slopes of Teton Village and Targhee.  God I miss it.  Still get up to fish the Winds in the Summer.

  118. Yikes Pharm – with that many s/r lines – how can you miss?  

    LOL Burr – Just gotta play this historical moves.  USO $37 puts at $110 – up 20% so far.  I guess if you took the $4K Futures margin and put it in USO instead, same outcome…

    Gasoline, meanwhile, failed to hold that $2.90 line and it's getting late to pop it into the close.  

    Interesting mix, Cdel.  Of course, I prefer cash, cash, cash and CASH!!!

    Reagan/Shadow – He seemed like such a nice, old man….

    STX/JPH – How about the July $46/50 bull call spread at $2 – then all it has to do is hold $50 and you make $2. 

    SGEN/Pwright – When things like that happen, you might want to make an offer and see if you get the fill at that price. 

    Killer robots/Deano – No debate, they are cost-effective so we'll use them.  As a leader in tech, we'd be nuts to give up that advantage – though it won't last forever and we'll probably be run over by cheaper Chinese robots at some point.  On that Sherlock Holmes TV show, they had a guy murdered by a fly-sized drone that injected him with poison – welcome to the future!

    Quotes/Deano – Don't you have those controls on top of your chat box?  

  119. "break on down, to the other side" …. of 100

  120. Most Millionaires think they SHOULD be taxed more and that minimum wage should be higher BUT, when you split it by party – almost none of the Reps think so – amazing how one party can be so completely out of touch with the will of the people – even the ones they claim to represent:

  121. SPY calls/pat – well, a few weeks ago I bought 50 SPY May 190 calls for 51c.  Now I am going to roll those to the SPY May5 192 calls for 9 cents more, so net in is $3K.  (51c + 9c)*50 = 3K.  I am going to then buy 50 more at 30c = 1.5K. So net is not $4.5K for 100 contracts (45c).  If they get to 45c or so, sell 1/2.  Let the rest ride, or sell all and be happy one is out even, or go for the moon shot….

    Lines/Phil – well, not my chart.  But the range is the point.  DJI 16400 or so, SPX 1850ish…..

  122. scottmi re: UNP, I'm with you, just figure on selling more premium on Monday..

  123. Phil – I like Elementary too.  I saw the fly drone episode and remembered that one of the Ted Conferences featured some guys who developed a laser that could zap mosquitos out of the air using commonly available parts.  I wish I could find the link. 

  124. Banksters still have a booming drug trade (British press, of course – US Corporate Media won't cover this):   Official statistics show that huge sums of drug money are laundered every year:

    The United Nations Office on Drugs and Crime (UNODC) conducted a study to determine the magnitude of illicit funds generated by drug trafficking and organised crimes and to investigate to what extent these funds are laundered.  The report estimates that in 2009, criminal proceeds amounted to 3.6% of global GDP, with 2.7%  (or USD 1.6 trillion) being laundered.

    This falls within the widely quoted estimate by the International Monetary Fund, who stated in 1998 that the aggregate size of money laundering in the world could be somewhere between two and five percent of the world’s gross domestic product.  Using 1998 statistics, these percentages would indicate that money laundering ranged between USD 590 billion and USD 1.5 trillion. At the time, the lower figure was roughly equivalent to the value of the total output of an economy the size of Spain.

    This is why we don't run this strategy anymore (but most hedge funds do)!  

    And down we go again, right at our watch levels.  

    Oil failing $100!  

  125. Millionaires / Phil – Notice that the Reps do support more education opportunities and savings incentives. But mostly because these are just empty words anyway! The concrete stuff like higher taxes and higher wages have financial consequences….

    I can't believe that so many people can't see that when it comes to the lower classes they are all talk… Look at the way the call their bills – kill the food stamps and call the bill National Nutritional Incentive Bill! Or Health Opportunity Bill…. That works!

  126. UNP/pwright – if still flat on Monday, will probably roll the June 190 call out as i'm concerned it's theta crush will start getting ahead of what premium can sell.

  127. scottmi: makes sense, how far out do you go?  maybe Aug 190s (about $5 now)?

    Also I've been playing with these short weeklies on the calendars, I notice that, if you have the long but expect a short term pullback, you can sell the weeklies slightly in the money, if it drops and your shorts expire worthless, that can be a nice deal / did you ever try to play it that way?  Or better just to take the premium and keep the spread as wide as you can?


  128. scottmi I was more thinking of a trade where you would have a long that was further in the money (probably wouldn't try it in the UNP, where our long is still out of the money)


  129. Mondays during OPEX week are bullish FWIW.

    "if you follow the PitBull rule about a low the Thursday or Friday the week before the expiration, then we should be on the lookout for some type of low today. According to the S&P cash study, the Friday before the expiration has been up 17 / down 13 of the last 30 occasions and Monday has been up 21 / down 9 of the last 30 occasions.

    These are very bullish stats. Our view is to look for a retest of yesterday’s lows; we lean to selling the early rallies and buying weakness." – Mr. TopStep

  130. I managed to secure a loss on /CL here at the end of the day/week trying to catch a drop below $100.  Swept me up instead.  So far my futures experience has been many small gains followed by a large loss giving it all back (plus transaction costs).  Hmmm…

  131. Pwright – I have been ITM for the longs and played specifically for gathering short premium, but that is not this play. This was cover (in case was wrong) for a premise that stock is and will continue moving up. Premise not blown, but the june was close and is closer now so theta decay becomes concern. Often I start with further out ATM or slight ITM long calls but it is always a tradeoff for low cost (and exposure) with potential for high quick returns, to higher cost with lower % returns.

  132. MCP – good grief. more houses being built, cars being sold, the economy is 'growing' says the talking heads, more phones and ipads than ever will be reaching with world, and giga factories for lithium batteries are 'coming soon'…  but no one wants or needs or expects to ever use any more rare earths? 

  133. sibe/ futures i hear you.. its a very tough game and can be very draining.  phil makes it look so easy, and when it works it is.  i think phil benefits from not needing to do it, almost like he's indifferent to the futures.  hes confident and has no stress with it. 

    on the contrary i end up being short when i should be long, long when i should be short.. wins get cut short by trailing stops, stops end up being turns points.  if only i could harness exactly the opposite of what i do :)

  134. Here is a one hour play, RUT IWM are out of sync above the others, since it is Friday a good chance the close will sell off from people unwilling to hold until Monday.  /TF, TZA, IWM puts may be winners.

  135. Phil, do you like bottom fishing on MCP here?

  136. scottmi makes sense, I was wondering, if we get in the money, (and you've got, say, the short 190 weeklies), will you be willing to pay to widen your spread?  Or better just keep rolling forward for a credit?

    Many thanks again

  137. So far this looks like a flush up on vapor but better reverse quick. The BOTS are watching what is said here. Why do we even matter? When you skim pennies!

  138. Mosquito Laser/Grant – That was a classic!   I'd love one of these systems for my pool…

    Monday's/Pharm – good point.  

    Oil/Sibe – Tsk, tsk, too greedy – especially on a Friday.  Could have just made a nice, relaxing 20% on USO wink.

    Meanwhile, neither oil or gasoline managed a move up into the NYMEX close (2:35) – if something doesn't happen to jack them up over the weekend, things could get ugly as traders scramble for the exits (a week from Weds is last trading day).  

    Click for
    Current Session Prior Day Opt's
    Open High Low Last Time Set Chg Vol Set Op Int
    Jun'14 100.27 101.18 99.71 100.05 14:37
    May 09

    -0.27 220097 100.26 242193 Call Put
    Jul'14 99.57 100.42 99.04 99.36 14:37
    May 09

    -0.23 92388 99.54 223352 Call Put
    Aug'14 98.68 99.47 98.15 98.48 14:37
    May 09

    -0.22 33067 98.65 127613 Call Put
    Sep'14 97.75 98.48 97.29 97.53 14:37
    May 09

    -0.22 21337 97.71 114826 Call Put

    About 700,000,000 barrels now – worse than it was earlier in the week and they have to roll over 200M barrels into the next 3 months, which are already stuffed with 4.7Mb and, don't forget, Sept contracts deliver in Oct, which is already getting into the much slower winter season.  Notice prices in Aug and Sept drop $1 per month – those are LOSSES for anyone buying a barrel today and selling it later.  

    MCP/Scott – That's my issue, the facts don't fit the narrative, do they.  

    No stress/Toe – I agree with that but that's why it's all about practice.  If you stress out about something, it's very hard to do it effectively and make good decisions along the way.  Also, I certainly learned a lot of very expensive lessons along the way – you can warn people and talk about it all you want but, in the end, experience is the only teacher people listen to.  

    Also, you have to get used to the manipulation.  You're not doing everything wrong, you are just seeing "THEM" move the stick against you the second you fill an order.  You need to PLAN for that to happen and get used to the pattern.  For me, I use it to my advantage since I generally am filling more than one contracts so I will purposely start a move higher and then, when they try to stop me out – I'll fill the bulk of my orders at the higher (when shorting) strike.   The downside of that plan is you have to be willing to take short-term losses and that means you have to do it a a few hundred times before you internalize how it works over the long run.  Playing a tight stop game is much tougher – but it's also the only way to learn, since you have to make thousands of trades to get the proper feel of it.   

    RUT/Shadow – I think they are going to try to hold the lines into the close.  The Shanghai is 2,011 – very close to catastrophic failure, the last thing they want them to do is wake up to a negative US close.  Also, the Dollar popping almost 1% today did nothing for the Nikkei – that's also a scary sign.  They can close the Dow at another all-time high if they pop it to 16,580 into the close – seems like something they are likely to do as that's the headline they'd love to print.  


    MCP/Palotay – Sales volumes were actually up about 10% but prices were down 24%.  They would have made more but they had production issues in California that I think are over but they only have $236M left and they burned through $46M last Q and $168M from last year – not the best trend.  They haven't made any money at all since 2011, when they made $100M and, since then, they've lost $850M, so it's not like they just need a small turnaround.  Sales are $550M so prices will have to do a lot more than go up 25% to stop the bleeding.  In short – I wouldn't jump in just because they fell from $6 to $3 – we did that with Bear Stearns and it didn't turn out well…

    Flush/Shadow – As I was just saying above…

  139. Phil

    I am only looking at the RUT as ahead of others, scared traders, and Pharms point on Monday. I am only risking profit and may wish I bailed earlier. I am out no matter what.

  140. pwright – pay to expand.. sometimes. always depends on the trade, the stock, the premiums. in general though, default is roll to same strike unless there is a good deal for a wider roll or a really clear new support line has formed.

  141. phil/futures – some great advice as usual.  i feel like i am so close, so very close to being able to consistently make money trading futures, which probably just adds to the frustration because i havent figured it out quite yet.  so close but so far. 

    its hard when the line you pick works exactly as you thought it would, except you get stopped out for a loss right before the move happens.. or a nice 10 point move occurs that you were right on top of but you only managed to get 2 points of it. 

  142. scottmi thanks, these are cool trades, now I'm scouring around looking for longs to try em on !


  143. Other points on IWM today; dip buyers went in heavy at 9:45, strong @ 11:10 and 12:35. They usually get out by EOD, this is a little different from the rest of the week. FWIW

  144. Mosquito – I like what these Brazilian mad scientists have done:

  145. Diagonals/pwright. works on shorts too.. right now I have USO June 37 puts, half covered with may2 36 short puts and  may36.5 short puts (just rolled to today from may2 36.5s). The 36s should expire today so leaves me with good downside run if Ukraine declares peace or we just get another good smackdown.

  146. FTR closing in on first close over $6 in…years.

  147. Futures/Toe – The real secret is NOT trading most of the time.  Make sure all the stars are in alignment and get out the minute one of your confirming indicators moves the other way.  Look at oil today, it was a great short but also a great long between $100.50 and $101, until it finally broke down.  I see 6 .50 moves between those lines just today with a high of $101.18 and a low of $100.36.  If those stopped you out – your stops are too tight.  Watch the webinar from this week – yes, I pick a stop line but, if I don't think the move that hits it is strong, I wait and see if it's really holding or I move it up a bit.  Of course, you have to have the conviction in one direction or another.  

    LOL, there's the Dow 16,580!  All that matters is the headline you get to print over the weekend.  

    FTR/Scott – That's one I really like for a dividend play.  

  148. gees, who lit a fire under CLDX

  149. Can't speak for the DOW and news headlines but IWM is going up on under 100 share lots and never seen so many 1 share trades. Not sure these are even vapor trades, way under pump to dump.

  150. same with IMGN, big  daily reversal

  151. Phil,

    Seeing "them" move the stick against me is exactly what I saw.  A quiet, lazy decline was underway until the moment I entered, then it banged up like a pin ball machine.  I rattled around for a couple of minutes like a cat in a garbage can before running for cover.

  152. ARIA – I am selling the June $8 calls against my stock.  100% cover.

  153. FYI, the /CL Options are 1000x.  So a single $2 put is a risk of $2000, not $200 like equity options.  

  154. Look at Goldman chasing everyone out of SUNE , while there were 15000 July calls traded today, most  look like buys

  155. Dow up 28 points isn't exactly a crack the champagne kind of event.  

    Vix back below 13 because, you know, we're not volatile at all. 

    I'm surprised /NKD is still at 14,190 with the Dollar at 79.90.  I guess the diving Euro is outweighing it.  

    • Molycorp (MCP -18.6%) shares plunge for a second straight day after Q1 results brought another substantial loss, marked by a deteriorating liquidity position and lower prices for rare earth metals, and little reason to suggest that operations would turn cash flow positive any time soon.
    • Today, analysts at J.P. Morgan pile on by downgrading the stock to Underweight from Neutral, expecting another capital raise this year – logical timing, considering the rate MCP is burning through cash – made all the more urgent as the Mountain Pass ramp is happening more slowly than expected.
    • Shares have lost a third of their market cap in two days.


    • Jumbos are growing while almost everything else is dead,” says FBR's Paul Miller. “Big banks need loan growth. If they were getting decent commercial loan growth, they wouldn’t be so aggressive on competing for jumbos.”
    • As the rest of the home loan market contracts (sharply), applications for jumbo mortgages (above $729K) were up 4.9% Y/Y in March. Another reason for banks plowing into jumbos: They don't have to pay the higher guarantee fees charged by the GSEs, allowing them to actually charge lower rates than on conforming loans. At Wells Fargo (WFC), the current rate for a 30-year fixed jumbo mortgage of 4.13% is 12 basis points less than that for a conventional mortgage loan.
    • JPMorgan (JPM) is boosting its efforts and created a special process to review all declined loans to make sure the decisions make sense. It also has a group working with wealthier clients who have more complex financial situations, such as being self-employed. The bank's jumbo mortgage originations accounted for 21% of all mortgages in Q1, up from 10% a year earlier.
    • At Bank of America (BAC -1.7%) the down payment required for most jumbos less than $1M was cut this year to 15% from 20%, and nonconforming originations in Q1 were 37% of all mortgages vs. 22% last year.
    • In its 10-Q, Goldman Sachs (GS) says it expects litigation expenses to remain "high" and discloses a boost to reserves to $3.7B from $3.6M. Rumored a few days ago, Goldman is indeed under scrutiny for possible violations of the Foreign Corrupt Practices Act.
    • The bank also says it's under investigation over high-frequency trading, though it didn't specify which agency is having a look.
    • The EPA is taking the first formal step toward requiring oil and gas drillers to disclose the content of fluids they use in fracking, saying it will begin to solicit public comment on whether companies should publicly list the chemicals used to extract oil and gas out of the ground.
    • Disclosure of the chemicals by companies could be positive for industry if it can allay fears of fracking opponents about toxic chemicals in groundwater, says natural gas consultant Miriam Swydan Erickson.
    • Baker Hughes (BHI) said last month that it will spell out all the chemicals it uses in fracking, but many other major companies have said their chemical formulas are proprietary and disclosure could help competitors copy their process.
    • Transocean (RIG +1%) claws back a day after falling 4.3% despite reporting better than expected Q1 earnings; Howard Weil says the result had been heavily discounted since the outlook really did not change.
    • Even the achievement on the revenue efficiency front, hitting the highest level since early 2008, carried little weight, Weil says; at the end of the day, RIG still has ~20 floaters set to roll off contract in 2014 and again in 2015, which spooked investors in the current environment.
    • RIG's next step in the multi-stage process of divesting non-core assets and high-grading its fleet is the creation of the new Caledonia Offshore entity; RIG said in its earnings call that it would decide later whether to sell the company to a direct public or private buyer, spin the company or IPO.
    • The corn harvest will hit a record 13.935B bushels this year, says the USDA in its latest report, bringing U.S. stockpiles to 1.726B bushels, higher than analyst forecasts. Global stockpiles will jump 8% to 181.7M metric tons thanks in part to big crops in Ukraine and Brazil.
    • Analysts were taken by surprise by the big U.S. supply figure given farmer intentions of planting 4M fewer acres than last year, but the USDA is banking on normal weather, seeing the harvest at 165.3 bushels/acre, up 6.5 bushels from a year ago. "These are big, bearish numbers," says a futures broker, but "we still have to go out and produce the crop."
    • July corn is off 7 cents to $5.09 per bushel. CORN -2%
    • July wheat is off 7.25 cents to $7.28 per bushel after the USDA pegs global inventories at 187.4M metric tons, up from 186.5M for the current season. WEAT -0.8%
    • July soybeans are higher by 17.5 cents to $14.87 per bushel after the USDA cuts its stockpile estimate to 130M bushels from 135M. The agency sees production this crop year at 3.635B bushels from 3.289B a year ago. SOYB +0.5%
    • ETFs: JJGGRU
    • Passenger car sales in China rose 13% to 1.5M units in April.
    • The sales growth rate at Ford swamped that of GM, 29% vs. 6.3%, on strong demand for Mondeo and Focus vehicles.
    • Sales in China got a boost from anticipation that more local governments will restrict sales due to pollution.

  156. Shadow, many ’1′ for spy & QQQ. Interesting…

  157. scottmi re: shorts: good point.  Also I've been incorporating your strategy on the downside hedges (TZA, DXD), the worst thing about those has been premium burn, this is a good way to overcome that. 

    For the USO trade, I'm guessing it's all about entries; I might wait til / if we get a spike up to 101 or so on /CL, give it a try

  158. LOL Sibe – Yep, that's how it feels.  

    Good point Burr.  

    SUNE/Stock – That's why we wait.  

    ALL TIME HIGH ON THE DOW – WOO HOO!!!! Congrats everyone, now you can tell your grandchildren you were there when it happened…  The excitement was palpable, wasn't it?  

    Have a great weekend all, 

    - Phil

  159. ...

  160. Phil  Looking to your comments over the weekend.  How much hot air can they pump into the market before it blows?

  161. Education / Phil – Goes back to my previous comments. The GOP talks a good game about education – we need to improve it, the free market is the solution, incentives, etc. But won't allocate one penny more to help students. But $310B of tax breaks for big businesses – no problem (

    I just saw an article about how now they want to run an investigation on why veterans have to wait so long to see doctors and the guy was saying – duh… the VA can't hire more doctors to see all these wounded veterans (from wars that these guys in Congress started) because Congress won't give them more money. And yet, the VA medical centers have a 91% approval. Compare that to your free market hospital! It's just sickening.

  162. phil/futures – do you believe there are "better" markets to practice in than others?  the two markets i seem to have the best success with are rut and cl. 

    also you have spoken many times about targeting 25/50 cent gains per trade in cl .. if im trading one contract and im placing a hard stop at 20 cents .. does the math even work to enable success?  the old axiom is dont trade unless there is a 2 or 3 to 1 ratio potential profit ratio.   i feel like you  go more by how a trade is looking and feeling and im trying to be more rules based..

    also, if you were me trading one contract in rut and cl, at what point would you move your trade to breakeven?  in rut i do so after about a point and a half and cl i do so after 10 cents. 

    as always thanks for the insights.. have a great weekend!

  163. Cash…

    O'Hara's research found that the average S&P 1500 stock is down by more than 12% from their recent 52-week highs. The average stocks in the Russell 2000 and Nasdaq Composite are down by more than 20%, which means you can say they are in bear markets.

    "Historically, this sort of divergence does not bode well for the longevity of a market’s upward inertia," said O'Hara. "We went back and examined instances where the market made a new high and looked at where the median stock sat compare to its high. Our data suggests that the current breadth reading is very unhealthy. Not only are new highs diminishing but we are seeing many stocks making new lows. This breadth divergence is a major concern."

    O'Hara says this isn't necessarily a screaming sell signal.

    "However the powerful message of “there is something wrong” should not go unnoticed," he cautions.

    cotd average stock bear market

  164. Thanks, Stjeanluc and Phil for the Virtual Short Strangle portfolio updates.  It has been nice to stay out of the chopping range for the indices lately.  The whipsaws must have made many people dizzy.

  165. From Bloomberg, May 9, 2014, 7:09:53 PM

    U.S. stocks fell for the week, giving
    the Nasdaq Composite Index (CCMP) its worst decline in a month, as a
    technology and small-cap selloff overshadowed optimism the
    Federal Reserve will continue to support the economy.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  166. From Bloomberg, May 9, 2014, 11:14:22 AM

    Russia’s President Vladimir Putin, right, speaks with China’s President Xi Jinping during a bilateral meeting at the G-20 summit in St. Petersburg, Russia, on Sept. 5, 2013. Photographer: Alexander Nemenova-Pool

    Russian President Vladimir Putin plans to open the door to Chinese money as U.S. and European sanctions over Ukraine threaten to tip the economy into recession, according to two senior government officials.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  167. From Bloomberg, May 9, 2014, 7:33:32 PM

    An unmanned aircraft almost struck a
    US Airways flight over Florida in March, a pilot told the
    Federal Aviation Administration, highlighting safety concerns as
    U.S. regulators develop rules for civilian drone use.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  168. From Bloomberg, May 10, 2014, 12:00:00 AM

    Jacob J. Lew, U.S. treasury secretary, speaks during a Bloomberg Television interview in Washington, D.C. on May 9, 2014. Photographer: Andrew Harrer/Bloomberg

    U.S. Treasury Secretary Jacob J. Lew
    said he will call on Chinese leaders to let markets determine
    the value of the yuan and to avoid postponing measures to
    overhaul their economy even as growth falters.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  169. From Bloomberg, May 9, 2014, 11:00:01 PM

    Petroleo Brasileiro SA (PETR4) posted a 30
    percent drop in quarterly profit, in line with analysts’
    estimates, after cost-cutting efforts by the biggest crude
    producer in deep waters were blunted by losses at its fuel unit.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  170. From Bloomberg, May 10, 2014, 12:00:01 AM

    Timothy F. Geithner, then-president of the Federal Reserve Bank of New York, speaks during a session on day four of the World Economic Forum in Davos, Switzerland, on Jan. 26, 2008. Photographer: Adrian Moser/Bloomberg

    Timothy F. Geithner was at the edge
    of a cliff.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  171. From Bloomberg, May 6, 2014, 1:59:19 PM

    A development in Illinois. Photographer: Daniel Acker/Bloomberg

    Premature withdrawals from retirement accounts have become America’s new piggy bank, cracked open in record amounts during lean times by people like Cindy Cromie, who needed the money to rent a U-Haul and start a new life.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  172. From Bloomberg, May 9, 2014, 2:15:20 PM

    Pakistani paramilitary soldiers in the lawless area of Dara Adam Khel, in the Northwest Frontier Province near Peshawar, in this Feb. 1, 2008 file photo. Photographer: Tariq Mahmood/AFP via Getty Images

    Umaima Ahmed opens her mouth at a polio vaccination booth outside the international airport in Karachi, Pakistan, as a health-care worker squeezes a few drops of clear liquid onto the three-year-old’s tongue.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  173. From Bloomberg, May 10, 2014, 12:00:27 AM

    Treasury two-year notes gained the
    most in four weeks as Federal Reserve Chair Janet Yellen
    tempered speculation that an improving economy would accelerate
    an increase in interest rates.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  174. From Bloomberg, May 9, 2014, 2:49:08 PM

    A Thai anti-government protester waves a large national flag as Thai riot-policemen stand guard at the entrance of a television station during an anti-government rally in Bangkok on May 9, 2014. Photographer: Pornchai Kittiwongsakul/AFP via Getty Images

    Thai protesters rallied outside
    television stations and state offices, and urged lawmakers to
    support their bid to topple the government, two days after
    Yingluck Shinawatra was ousted as premier by the courts.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  175. From Bloomberg, May 8, 2014, 5:34:55 AM

    Masayoshi Son, chairman and chief executive officer of SoftBank Corp. Photographer: Tomohiro Ohsumi/Bloomberg

    With Alibaba Group Holding Ltd. filing to go public, the biggest winner won’t be founder Jack Ma or his fellow executives or even venture capital backers like Silver Lake Management LLC. It’ll be Japan’s Masayoshi Son.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  176. From Bloomberg, May 9, 2014, 3:03:18 PM

    The International Monetary Fund, which
    currently expects growth of 7.5 percent this year in China, may
    lower its forecast for the world’s second-largest economy,
    according to Changyong Rhee, director of the fund’s Asia and
    Pacific Department.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  177. From Bloomberg, May 9, 2014, 5:48:15 AM

    May 5 (Bloomberg) — Thomas Murphy, managing partner at Family Office Research & Management Ltd. in Sydney, a private wealth management firm, talks about central banks’ policies of Australia, South Korea and Japan.
    Murphy also talks about the U.S. government’s diplomatic policy. He speaks with Zeb Eckert on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    South Korea’s central bank left its
    key rate unchanged and the government said it will speed up
    spending, seeking to spur growth that faces headwinds from a
    surge in the won and weaker consumption after a deadly ferry

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  178. From Bloomberg, May 9, 2014, 7:03:17 AM

    Wall Street can be an unforgiving workplace. Photographer: Timothy Clary/AFP/Getty Images

    It’s probably just a sad coincidence, but the sudden deaths since December of a group of young men who worked for JPMorgan Chase & Co. (or who once did) have conspiracy theorists in a tizzy.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  179. From Bloomberg, May 9, 2014, 3:43:59 PM

    Senate Minority Leader Mitch McConnell declared the 60-vote Senate when President Barack Obama was first elected. Photographer: Andrew Harrer/Bloomberg

    Judging from Glenn Kessler’s takedown of a claim by Barack Obama, I guess I need to go over the right way to count filibusters, again.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  180. RadioShack closes near all-time low, analyst says “the ship is sinking”

    Yesterday, 06:55 PM ET · RSH

    • RadioShack (RSH) has lost almost half its market cap since the beginning of the year, plunging 9.5% today and coming within pennies of its all-time closing low after reneging on its plan to close up to 1,100 stores.
    • RSH said its credit agreement only allows it to close up to 200 stores per year and up to 600 over the life of its credit agreement, prompting Wedbush analyst Michael Pachter to respond that “the creditors clearly are in control of the ship, and in our view, the ship is sinking.”
    • Pachter sees management and creditors trying to compromise on a smaller number of store closings; otherwise, RSH could declare bankruptcy, holding off the creditors and allowing it to close as many stores as it wants.

  181. Report: ArcelorMittal in talks to buy BHP iron ore asset in Guinea

    Yesterday, 06:27 PM ET · MT

    • ArcelorMittal (MT) is in deep discussions with BHP Billiton (BHP) to acquire the latter’s stake in the Mount Nimba iron ore deposit in Guinea for as much as $500M, WSJ reports.
    • BHP has been trying for months to find a buyer for its 41.3% stake in the rich deposit located close the Liberian border, as it seeks to exit west Africa and focus its investments elsewhere in the world.
    • Other partners in the project include Newmont Mining (NEM) and Areva (ARVCF).

  182. Chinese carriers allowed to set their own prices

    Yesterday, 05:21 PM ET · CHL

    • Starting tomorrow, China’s state-run carriers – China Mobile (CHL), China Unicom (CHU), and China Telecom (CHA) – will be able to set their own service prices without having to first clear them with the government (as has been the case thus far). The policy change covers voice, text, and broadband services.
    • Nonetheless, the carriers will still be prohibited from offering “excessive” discounts. The regulatory change is part of a broader effort by the Chinese government to let market forces determine prices.
    • It follows two moves from regulators that could pressure the carriers’ bottom lines: The imposition of a telecom VAT, and the issuing of MVNO licenses to Alibaba and ten other firms.

  183. Twitter execs sell shares; major investor distributes stake

    Yesterday, 04:51 PM ET · TWTR

    • Following Twitter’s (TWTR) Tuesday lockup expiration, COO Ali Rowghani exercised 300K options at an $0.84 strike price, and sold them at $33.76. Finance VP Luca Baratta sold 9,285 shares at $31.44, and general counsel Vijaya Gadde sold 13,346 shares at $33.77.
    • Meanwhile, money manager Rizvi Traverse Management has distributed its entire 14.4% stake to its investors, which include affiliated entities, JPMorgan, and an investment company controlled by Saudi prince Alaweed bin Talal.
    • The moves come after Rizvi other major shareholders, including CEO Dick Costolo, co-founders Evan Williams and Jack Dorsey, and VC firm Benchmark, stated they plan to hold onto their shares for now.
    • Earlier: Twitter gets its second upgrade in two days

  184. Dow closes at record high, Nasdaq leads afternoon up move

    Yesterday, 04:15 PM ET

    • Stocks finished with modest gains but they were enough to lift the Dow to a new record close, in a session marked by little economic news to digest and the end of earnings season drawing near.
    • The consumer discretionary and health care sectors led late-day gains, and momentum stocks bounced back after a three-day slide; the Nasdaq led the major indexes higher but still ended its biggest weekly drop in four weeks after investors dumped tech and small-cap shares.
    • Treasurys spent most of the day anchored to their flat lines; the benchmark 10-year yield edged slightly higher to ~2.62%.

  185. Liquidmetal falls after posting Q1 results

    Yesterday, 04:08 PM ET · LQMT

    • Liquidmetal (LQMT -9.3%) had Q1 revenue of $160K (largely from product sales) vs. $122K a year ago. Net loss rose to $3.91M from $3.49M a year ago.
    • SG&A spend rose 41% Y/Y to $1.85M, and R&D spend 42% to $334K. The company ended Q1 with $6.95M in cash/equivalents, and $6.65M in warrant liabilities.
    • Liquidmetal says it “continued to focus on the development of prototype parts for its customers and partnering with licensees on the development of the company’s technology and production processes.”

  186. At the close

    Yesterday, 04:00 PM ET

    • Dow +0.19% to 16583. S&P +0.15% to 1878. Nasdaq +0.50% to 4071.
    • Treasurys: 30-year -0.11%. 10-yr -0.02%. 5-yr +0.02%.
    • Commodities: Crude -0.19% to $100.07. Gold +0.1% to $1289.
    • Currencies: Euro -0.6% vs. dollar. Yen +0.16%. Pound +0.49%.

  187. The Lack Of Winter Weather Makes Vail Resorts A Buy

    Yesterday, 07:30 PM ET | by Marshall Hargrave Includes: mtn

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  188. U.S. Trade Rebound Only Partial; Oil Involved

    Yesterday, 06:54 PM ET | by Joseph Calhoun

    By Jeffrey P. SniderApril trade data for Chinese exports purportedly show a rebound forming, though its size and even legitimacy is still much in doubt. The fake Hong Kong invoice scandal of last year is making comparisons to this year difficult, but that doesn’t and won’t quell the extrapolations.The export data are “somewhat inconsistent with the weakness seen in new export orders” in …

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  189. Middleby Continues To Defy Gravity

    Yesterday, 06:30 PM ET | by Stephen Simpson, CFA Includes: midd

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  190. Transocean Ltd.: What Really Went Wrong During The Conference Call On May 8?

    Yesterday, 06:20 PM ET | by Fun Trading Includes: rig

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  191. Big Oil Under Serious Threat

    Yesterday, 05:05 PM ET | by Shareholders Unite

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  192. Is Something Big Brewing In Silver?

    Yesterday, 04:48 PM ET | by Dave Kranzler

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  193. So much for income mobility in the US:

    If your chances to end up in the top quintile from the bottom quintile is 4%, it's pretty much down to luck rather than skills and hard work! And maybe bad luck for the 8% on top quintile that end up at the bottom.

  194. Pretty damned bad luck to end up in the second quintile too, that's still a LONG way down from the top!

    It would be nice if they broke it down to tenths or less, you don't get the real story looking at the top 20% as a group.  A guy in the top 1%, who makes $400,000 a year at the bottom of the 1%, can keep his kids above the bottom 40% with 10% of his income.  

  195. Personal Portfolio Stats: As the DOW has reached an ATH, so too has the WinstonPort. Some relative stats indexed to the Net Liquidation Value as given in TOS:

    Option Buying Power: 18%

    Cash: 90%

    P&L gain/loss YTD: 9.2%

    3 biggest positions: AAPL, CAT, GS, PCLN

    Largest gainers YTD: AAPL, GS, CAT, BA, TSLA, AMGN, STO

    Largest losers YTD: PCLN, CLF, RIG

    For AAPL, GS, PCLN have positioned as short calls 2015, long BCS 2016.

    I have been closing out naked short puts with 2015 expiration. I still have too many – in effect these are the only positions that can significantly hurt me, but in general plenty of rolling opportunities for these. For the short calls, I can cheerfully handle a market 'crashing upwards'.

    Used recent strength to cash out long 2015 calls and layer on 2016 BCS – no 2016 puts yet placed, will wait to see when the inevitable correction comes. Lots of flexibility in the put selling area.

    I like to keep significant amounts of option buying power, as past experience has shown me my blood pressure is inversely related to the amount of OBP I have left. 

    My hedging strategy is based on short calls on key positions. I have tried the ultras (DXD and TZA) but found them worse than useless in practice – I guess I must have been doing something wrong, but the theory and practice diverge significantly when it comes to using the ultras as hedges. I have been more successful with cashing out longs, and establishing longer term LEAP BCS. I think the law of large numbers comes into play also – there is no way I am sticking over 2% of my NLQ in hedges!

    This is the post that proceeds the crash :) (a shaman told me to write that).

    Finally, I got to where I am now through a lot of hard work, tons of reading, gaining and losing a fortune, and a strategy founded on the bedrock of Phil's principles intertwined with a calm zen patience. Thanks be to Phil for the good works you do and the passion and dynamism you impart to your members (I was going to say 'followers', but that starts sounding weird!!!).

  196. China is reportedly thinking about building a bullet train that reaches America

  197. Pfizer chief says AstraZeneca takeover would be ‘win-win for society’

  198. Senate approves ‘kill switches’ for cellphones sold in California – Los Angeles Times

  199. FCC’s Wheeler Denies Trying to Divide Internet Into “Haves” and “Have Nots”

  200. China’s Top Central Banker Says A Big Stimulus Isn’t Coming

  201. Science Shows How Guitar Players’ Brains Are Actually Different from Everybody Elses’

  202. World’s first atomic wristwatch comes to Kickstarter

  203. Where Are America’s 49 Million Hungry – An Interactive Map

  204. Thomas Edison’s Reaction To His Factory Burning Down Shows Why He Was So Successful

  205. Phil – here is a reminder to look at some "crash puts". Thanks!

  206. Some earnings analysis:

    Analysis / Conclusion: When we came into 2014, I originally thought that Sp 500 earnings could grow 10% in 2014, and with just modest p.e expansion, from 15(x) to 18(x) earnings, the SP 500 could be up another 15% – 20% on the calendar year in terms of return. We are flip-flopping (to put it mildly) on this expectation, but after seeing the q1 ’14 revisions and the expectations for q2 ’14 remain relatively stable, the last two – three weeks, I am back to thinking we could see +10% on the SP 500 earnings growth this calendar year, given the economic data, particularly job growth. The degree of p.e expansion we would see on that 10% earnings growth remains a mystery (as it always does).

    In calendar 2013, the SP 500 grew earnings 7% y/y, and yet the SP 500 increased 32% y/y. Id say that is a good example of p.e expansion.

    This year, the market’s flat return could be a function of allowing earnings growth to catch up to the index appreciation.

    What ever is happening to the SP 500 and growth stocks this year, it isn’t really earnings related. I’m growing ever more confident of 10% earnings growth for 2014.

  207. Phil/CCJ
    I have the Jan15 $19/24 bcs. I think you have this in one of your portfolios. I was more conservative and have not sold puts yet. My net on the spread was $2.88 and the $19 calls are showing $2.70 which is where you usually recommend we start to look to roll. Would you adjust yet, or wait to see if $20 stays a floor? Thanks

  208. Someone mentioned MCP the other day:

    I recently saw someone refer to Molycorp (MCP) as one of the greatest “pump and dump” schemes ever.  In the last week it lost about a third of its market cap in the wake of a disappointing earnings report.  Stories also mentioned a downgrade by J.P. Morgan from “neutral” to “underweight.”

    Then I saw a tweet from Jamie Lissette (@jamielissette) that referenced $105 price targets on MCP from J.P. Morgan back in the day.

    So, we are back to the folly of price targets (we have a target theme going here), something I have written about many times in the past, including in an essay that said they are “best understood as marketing tools rather than analytical ones.”

    The chart illustrates the public market history of MCP.  In the top panel are the stock price, the consensus target price, and the target at J.P. Morgan, including the $105 plateau.  The bottom panel shows the percentage upside implied by each of the target prices.

    The real damage to investors was done during 2011 and 2012 when the hype machine was going full steam even as MCP was falling from its highs.  Implied upside was routinely near 100%.

    14 0510 zMCP

  209. That quite the divergence:

    That chart shows the Dow and SPX gaining 1.6% and 1% respectively since March lst when the market started to weaken. While the large cap indexes gained ground, the Nasdaq Composite Index lost -5.5% and the Russell 2000 Small Cap Index dropped -6.4%. In other words, investors haven't necessarily left the market. But they have been rotating out of riskier growth stocks into safer value stocks. Defensive stocks that pay dividends have been market leaders. That hasn't necessarily hurt the overall market trend, but isn't necessarily a sign of confidence either.

  210. From Bloomberg, May 11, 2014, 8:38:42 PM

    May 8 (Bloomberg) — Medha Samant, investment director for equities at Fidelity Worldwide Investment in Hong Kong, talks about the outlook for Asia stocks.
    She speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    Asian stocks swung between gains and
    losses after Chinese President Xi Jinping said the nation needs
    to adapt to a “new normal” in the pace of economic growth.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  211. From Bloomberg, May 11, 2014, 5:40:32 PM

    A worker sets up a voting box in one of the polling stations in the eastern Ukranian city of Slavyansk, on May 10, 2014. Photographer: Vasily Maximov/AFP via Getty Images

    Pro-Russian groups hailed a large
    majority in favor of secession in a referendum they organized in
    eastern Ukraine that was dismissed as illegitimate by the
    government in Kiev and its U.S. and European allies.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  212. From Bloomberg, May 11, 2014, 8:45:48 PM

    Haruhiko Kuroda, governor of the Bank of Japan (BOJ). Inflation will probably accelerate to the central bank’s 2 percent goal next fiscal year, BOJ Governor Haruhiko Kuroda said after the central bank released its quarterly outlook on April 30. Photographer: Tomohiro Ohsumi/Bloomberg

    Japan’s Government Pension Investment
    Fund should adopt a short-term strategy as the central bank’s
    plan to spur inflation creates the risk of a bond rout, said the
    former head of the fund’s investment committee.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  213. From Bloomberg, May 11, 2014, 5:00:07 PM

    May 9 (Bloomberg) — Steven Major, head of global fixed-income research at HSBC Holdings Plc, discusses European and U.S. bond yields and the outlook for European Central Bank policy.
    He speaks with Anne Edwards on Bloomberg Television’s “The Pulse.” (Source: Bloomberg)

    Financial professionals are optimistic about the global economy, just not as fervent about it as they were at the start of the year. That’s the message from the latest Bloomberg Markets Global Investor Poll, which shows concern about risks ranging from the turmoil in Ukraine to the threat of deflation in Europe.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  214. From Bloomberg, May 11, 2014, 8:40:55 PM

    May 7 (Bloomberg) — Takahiro Sekido, a Japan strategist in Tokyo at Bank of Tokyo-Mitsubishi UFJ, talks about the Japanese government’s economic policy and the nation’s central bank policy.
    He speaks with John Dawson on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    Japan’s current-account surplus
    narrowed more than forecast in March as a surge in imports
    before last month’s sales-tax increase trimmed gains from
    overseas investments.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  215. From Bloomberg, May 11, 2014, 1:07:19 PM

    May 12 (Bloomberg) — Pavin Chachavalpongpun, an associate professor at Kyoto University and author of “Reinventing Thailand: Thaksin and His Foreign Policy,” talks about the political tensions in Thailand and prospects for elections.
    He speaks with Zeb Eckert on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    Thai security officials said they
    will arrest protest leaders seeking to install an appointed
    prime minister as rising tensions threaten to spark fresh
    clashes between supporters and opponents of the government.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  216. From Bloomberg, May 11, 2014, 8:33:53 PM

    Nobuyuki Hirano, president of Mitsubishi UFJ Financial Group Inc. and chairman of the Japanese Bankers Association, seated left, responds to a reporter’s question during a news conference in Tokyo. Even as equities slump, Prime Minister Shinzo Abe remains on target to achieve his goal of ending deflation, Hirano, said in an interview in March. Photographer: Kiyoshi Ota/Bloomberg

    When Japan’s three biggest banks
    report a jump in profit this week, investors should be warned:
    the gains are already disappearing with the drop in the stock

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  217. From Bloomberg, May 11, 2014, 9:11:52 PM

    Xi Jinping, China’s president. Xi said that China needs to remain “cool-minded” amid a slowdown in the economy, according to a Xinhua News Agency report posted on the central government’s website May 10. Photographer: Goh Seng Chong/Bloomberg

    Asian stocks dropped, pushing the
    regional index down for the first time in three days, while U.S.
    index futures gained after the Dow Jones Industrial Average
    climbed to a record. Gold led precious metals lower and wheat
    fell, while nickel advanced a fifth day.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  218. From Bloomberg, May 11, 2014, 9:23:17 PM

    Coffee sales by growers in Vietnam,
    the biggest producer of robusta beans used by Nestle SA, may
    slow after stockpiles slumped 54 percent from an all-time high.

    To read the entire article, go to
    Sent from the Bloomberg iPad application. Download the free application at

  219. StJ, thanks for posting about MCP, it was my mention on earnings day.  It's in my LTP from last November, ScottMi was buying leap BCS and selling puts and Phil liked it too so I followed in.  Time to bail, I think.

  220. Good morning!

    Ended up having more of a family weekend than I originally planned – didn't get anything done.  

    Doesn't look like I missed much, markets pretty much where we left them but China powered up 2% in less than one hour and then flatlined after the Chairman's remarks on growth.  Could have been manipulated but who can tell over there.  India popped 2.4% and was up steady all day as they are liking the election results so far but Singapore was down all day (1%) and Japan finally gave up in the end and turned down 0.35%.

    Europe is generally green but all over the place with London up 0.25%, Germany up 0.45%, France down just a bit, Italy up 0.7% and Spain up 0.1%.  

    Our Futures are up about 0.25% with the Dollar at 79.85.  Oil is $100.52, gold $1,296, silver $19.49 and a nice winner for the longs on that one, copper suddenly took off – now $3.15 (great for FCX) but Nat Gas dipped back to $4.48 and gasoline $2.92.

    On the whole, the positivity continues.  Don't forget, the Dow printed an all-time high to close the week and nothing has happened to mess up those good feelings over the weekend.  No big M&A news – just nothing.  

    • Tech Stocks Are Still 'Too Silly'

      Abreast of the Market: Young technology-company stocks fell out of favor in the blink of an eye. But their valuations remain sky-high and many investors say they have a lot more room to decline before bouncing back.

    The Market's Rough Rotation -- Former market leaders such as biotechnology and Internet-related stocks have fallen 25% and more from early-year highs. Many once-strong small stocks have taken hits, too. Money is shifting to safer, dividend-paying stocks such as utilities and telecom stocks.  Broad indexes, meanwhile, have been in a rut all year. The Dow Jones Industrial Average hit a record 16583.34 Friday, but it is up just seven points, or 0.04%, since the end of December.

  221. Warning: Weak Stock Market Closes Are On the Rise

    The Average Stock Is In A Bear Market

    Are Stocks Cheap?

    Are Valuations Really Too High?

    Bizarro Housing Bubble Spills Over Into "Overbid Madness", $10 Million "Flips" In 24 Hours

    • European Stocks Follow Asia Higher

      European stocks brushed off renewed tensions in Ukraine to trade slightly higher Monday, tracking recent gains in U.S. and Asian indexes

    Japan Debt Update: ¥1,020,000,000,000,000.00

    Japan Balance Of Payments Current Account Collapses To Record Deficit

    China Stocks Rally on Reform Plan - Shares in China rallied as investors cheered Beijing's new blueprint for capital-market reforms aimed at boosting regulatory transparency and widening market access.

    Here's Why Chinese Shadow Banking Is Still Accelerating

    • Heavy Rains Pound China

      Heavy rains over the weekend affected more than half a million people in southern and eastern China, triggering landslides, destroying 1,400 houses and forcing more than 50,000 to evacuate.

    India Shares Hit Fresh Record

    Investors were pushing up Indian markets on expectations that the country's main opposition party, perceived to be more business friendly, would form the next government.

    Loaded Imagery Inflames Ukraine Crisis on Both Sides

    Russia distorts history to paint Ukrainians as fascist, while Kiev labels pro-Russians in eastern Ukraine as terrorists.

    Putin Arrives in Crimea

    The Death Of Hedge Funds

    "The Gold Cartel" And The Giant Credit Bubble

    Platinum Lures New Buyers in Asia's Gold Heartland

    While gold continues to command the loyalty of millions in the world's second-largest consumer of the precious metal, the appeal of platinum is soaring in India, and growing elsewhere in Asia, even though platinum costs more.

    Goldman(GS): Iron ore price to crash

    Why Apple’s Beats buy is genius (Daily Dot)

  222. Hot air/Den – I think as long as the Fed keeps their foot on the gas, we can keep going up hill.  The question is, when does the Fed HAVE to stop?  That's tricky.  Their credibility has been resilient but maybe that's just because all the other CBs are playing the same game – so no one is going to point fingers and shout "shenanigans" just because we're manipulating our markets.  

    Education and Veterans/StJ – I've decided this country is hopeless and I'm going to vote for Russia to annex us in the next election.  cheeky

    Futures/Toe – I like oil and the RUT best too.  /NKD is pretty predictable if you like to watch the Dollar and the S&P is a nice, slow-mover while the Dow is very respectful of those 00 lines – so they all have their charms (except the Nasdaq, which is very annoying to trade) but, oil and the RUT are the easiest ones to trade for me as well.  As to stops, .20 is very arbitrary, the idea is to enter as close as possible to a resistance line. 

    Like right now, oil is $100.48 (/CL), so that's a short with a stop at $100.56 – that's an ideal entry as we're risking .08 to make .25 or more.  That means we can be wrong 3 times and right once and still be ahead!  

    Also, you can't be dogmatic about "rules" – if you are behind, then you should tighten your stops to try to get even.  Not losing is just as good as winning once you are behind.  Also, you simply have to learn to go with your gut but your gut WILL be wrong as often as not – especially in your first 5,000 hours of practicing.  That's all part of the learning process.  

    On moving to breakeven – if you have a winner and let it turn into a loser – you are doing something wrong!  It's all about momentum and, if you catch a .10 move on oil and it reverses on you – then you were WRONG about the momentum.  The idea is to take the money off the table, NOT when the momentum reverses on you but WHILE IT'S STILL GOING YOUR WAY – when the momentum slows and shows even the smallest sign of reversing – THAT is a good time to get out.  

    Averages/StJ – That's a hugely important chart!  

    Thanks Peter, great job!  

    Big Chart – Long way to go to get a strong bounce off the Nas and RUT. 

    Plosser is a real downer – he speaks at noon today.  

    LOL Winston – Good advice on blood pressure.  Thanks for kind words.  

    Crash puts/CDel – I will look for some but it seems to me that just going with DIA is probably best.  

    P/E Expansion/Pstas – Yes, see that chart above.  Kind of scary..

    CCJ/RJ – Exactly right because you want to preserve the $2.88 you put into the trade.  Since CCJ seems to have found a floor at $20, I'd buy back the $24 calls (.85) first and then your basis is $3.72 on the $2.75 calls.  IF $20 fails, THEN you need to look to 2016, where the $15/22 bull call spread is $3.80 so then your basis is up to about $4.80 on the $7 spread but, even at $18, it would be $3 in the money and THEN you could sell something for $2 (the $17 puts are already $2).  As long as you are comfortable owning CCJ long-term for net $19.80 (and, of course, you will be able to sell 2018 $20 puts and calls to bring that down too), then this is a good course of action. 

    Great divergence chart, StJ. 

    MCP/Mr.M – I liked them at $4.70 on Oct but, we got out around $6 up 30%) and that was it for that trade.  At the time, I said we WOULD play it with conviction if it went to $2.88 (my low target) from there.

    Them/Jomp – I assume you mean MCP?  I did like them, we added them to the Income Portfolio by shorting the $7 puts for a net $4.70 entry.  I still like them for $4.70 in 2015, I'm just angry at the sloppy management as the short puts should have been a cake-walk.  Still, as noted just above, our ALLOCATION was only to own net $9,400 worth out of our normal $25,000 allocation blocks so it's a 1x position and we're THRILLED to go to 2x at $2.83 for $11,320 and we STILL have $14,000 left to DD and, even if MCP ultimately falls to $1.83 and we lose $4,000 – it's just 16% of the $25K allocation which means the only dumb thing to do with this trade, at this stage, is waste our valuable time worrying about it when it's still 20% over our target 1x entry.  

    It's no different than what I was saying about Futures trades above – when you get a move your way and it slows down or reverses – GET OUT!!!!  Unless you are dead set on staying in for the long haul, you have to take advantage of moves in your favor or the only moves you'll ever act on are the ones that go against you and, clearly, that's not going to work out well…