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Thursday Thrust – Rent-A-Rebel Pops Oil Over $106 Just in Time for the Holidays

The boyz are back in town!  

By boyz, I mean al-Qeada and by town, I mean Tikrit, which is about 40 miles from Baghdad which has "dad" in it and Father's day is Sunday so now you are all caught up on the Middle East.

Oh, and that's not picture of the rebel attackers – that's a picture of the Iraqi "army" mounting a response to "dozens" of rebels who came into town "a hootin' and a hollerin'" and shooting up the place.  As I pointed out to our Members, with 200,000,000 fake orders for July oil deliveries that have to be canceled by next Friday – all it costs is $10M to pay al-Qeada to cause a ruckus and oil pops $2 overnight and the contract holders make an extra $400,000,000 – a very nice return on their investment.  CNN had footage of the attack:


As you can see, the situation is dire – until they get a new sheriff.  Meanwhile, oil is over $106 (7:45) and it was over $106 earlier and we shorted the cross below the line in our Live Member Chat room at 6:37 and picked up a quick $250 per contract at $105.75 and we'll short any cross below any .50 line with tight stops above on the way down – as, eventually, there will be a new sheriff – or at least a shareef

At the moment, oil is back over $106 and we're ready to re-load (at $106.50 with very tight stops).  As we did yesterday, we're happy to make $250-$500 per move as it wriggles around in the channel.  You can't beat these guys – may as well join them!  

We'll likely add USO puts or SCO (ultra-short oil) longs to our Short-Term Portfolio with an eye towards oil going no higher than $110 into the July 4th weekend (as we discussed in Tuesday's Webinar) but failing to hold that, or even $105, for an extended period.  Meanwhile, we'll keep an eye on the advancing al-Qeada forces as our Corporate Media makes the biggest possible mountain out of this mole-hill to justify their sponsors jacking up the price of oil – AS USUAL – into the biggest driving weekend of the year.  

Last June, oil was between $91 and $95 all the way until the last week of June but then, magically, it shot up over $105 just in time to screw Americans over at the pump and was held up around $110 into Labor Day, topping out at $112 before plunging back below $100 in September and all the way back to $92.50 in October.  That's why we'll be playing October shorts on oil – just like we did last year, when I said on August 28th (with oil at $110 and climbing, that time using Syria as an excuse):

SocGen calls for oil to go to $150?!?   That's a lot of money for oil.  That would put gasoline up around $5 per gallon so the easy trade here is to grab some /RB Futures contracts ($3.07) and, at $420 per penny, per contract, a single contract would pay us $81,060 if gasoline hits $5 – that's enough money to buy a Tesla, and then we never have to buy gas again!

For anyone who believes the idiocy being spun by Societe Generale or their other Bankster buddies as they bang the fear drum, accompanied by their MSM puppets – just buy a single, long gasoline Futures contract and you'll find yourself rooting for death and destruction in the middle east.

As you can see from the chart of oil Futures above – there's still plenty of money to be made on the short side as we only play the crosses BELOW the .50 lines and, even though oil went over $110 and fooled us once for a quick stop – it went all the way up to $112 without a retrace, then fell all the way to $111 for a $1,000 per contract gain and then fell through $111 to $110 for another $1,000 gain and then through $110 to $109.50, for another $500 gain.  Our job is just to stay in position, ahead of "The Big One" – like we had in the Summer of 1987:   


I know most analysts like to pretend they have original ideas for you but I'm happy to tell you that, last year, I thought we should do the same thing that worked in 1987 and this year I'm telling you we can do the same thing that worked in 2013 and ultimately paid us over $10,000 per contract.  In fact, I called on the President to give me the keys to the SPR so I could use it to short ALL of the NYMEX oil contracts (360M barrels worth at the time).  By October 22nd, that trade idea would have paid back $3.9 BILLION!  

As I said at the time:

Even if you didn't have $1.6Bn laying around, shorting a NYMEX Futures contract uses just $4,500 in margin (and don't miss our Options and Futures Trading Seminar in Las Vegas, Nov 10th and 11th) the LOX3 November $110 Futures option I suggested as an alternative on 8/28 cost just $450 per contract and paid off $1,000 when it expired last week (options expire earlier than the Futures, which expire today) a quick gain of 122% on whatever cash (no margin required) you may have had laying around to make a play.  

You can read those two posts to get an idea of all the different ways we were able to make money shorting oil last year and here we are again, coming into "Summer Driving Season" and again we will have an opportunity to make a ton of money on the back end – but it's a slow process and you have to be PATIENT and manage your position sizes to allow for the fact that oil can pop up another $10 and it could last a few month.  That's why we went over the scaling in and out strategies in Tuesday's Futures Trading Webinar.  

USO WEEKLYThe same(ish) strategies apply to options we will take on USO and SCO and yes, we'll look at the Futures Options on oil as well in our Live Member Chat room (which you can subscribe to HERE).  

It's not all oil trading, of course – just this morning we sent out an Alert to our Members adding two stocks to our Long-Term Portfolio.  But, for the moment, oil is going to be exciting, so we'll play it.  

In fact, while I was writing this (now 8:42), we caught the move back to $106.50 and then got another $250 per contract drop back to $106.25 and now we can afford a REALLY good breakfast with our two morning wins and we'll see if 3rd time's a charm as we prepare to reload.  

This is very exciting stuff – time for me to head off to the Live Chat Room!  


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  1. Good Morning!

  2. Oil lines are busted big time already…

    R3 – 105.53
    R2 – 105.17
    R1 – 104.9
    PP – 104.53
    S1 – 104.25
    S2 – 103.90
    S3 – 103.61

    Even my daily Fib lines are done – the last one was at 105.84! Not much reference at this point.

  3. LULU not looking too healthy this morning.  Big miss, bad guidance – not a good combination… 

  4. LULU / Phil … a very nice drop this morning to $37 … beat eps and sales but again cuts eps guidance, this time for Q2… once the dust settles and some downgrade police arrive I presume this is near time to open a 2016 bull call spread (maybe $35/45) and offset with some nice 2016 $30 or $35 puts …

  5. I am saying that NFLX is clean in the battle with the telcos, but the telcos are definitely fighting dirty:

    Not only is Broadband for America largely funded by a single contribution from the National Cable and Telecom Association (NCTA)—the trade group that represents Comcast, Cox, Time Warner Cable, and others—but a closer look at their member list reveals an almost random assortment of companies and community groups, many of which say they never intended to sign up for an anti-net neutrality coalition.

    Bob Calvert, the host of, a radio program listed as a Broadband for American member, told us that he is not familiar with the net-neutrality debate. "My program is a nonpolitical program supporting our men and women who serve and who have served our country and their families," said Calvert, in response to an inquiry from VICE.

    Another Broadband for America member, the Texas Organization of Rural & Community Hospitals, said it had joined only to support broadband access in rural and underserved areas, not on issues relating to net neutrality or the classification of broadband as a utility. "We will reexamine this endorsement and make a determination whether to continue supporting the coalition should we find that the current policies they are proposing would undermine the original goal of greater access for all Americans," said Dave Pearson, president of the group, which represents rural hospitals in Texas as the name suggests. [...]

    "Broadband for America is well practiced in the art of fooling people," says Tim Karr, senior director of strategy for Free Press. "Like other astroturf groups that have entered the debate over the future of the internet, BFA has erected a scrim of public-interest rhetoric to hide its true intentions: pushing the policy objectives of the nation's largest phone and cable companies. Sadly, the debate over issues like net neutrality and municipal Wi-Fi has been polluted by many such operations."

    How can you trust a word they say now…

  6. I love this quote from Brad DeLong following the Cantor loss and the role of illegal immigration for people who claim to read Ayn Rand:

    I've never understood how a Randite of any form can be opposed to immigration, legal or illegal: illegal immigrants are precisely the kind of entrepreneurial people impatient with being told by government where they can go and what they can do that Ayn Rand exalted…

  7. Phil

    "CIM, for example, is $3.20 and pays .40 per year and you can sell the Jan $ 3.50 calls for .10 and the $3.30 puts for .35 for net $2.75/3.025 so you can buy 3,000 for $8,250 and you'll get $300 per Q as a dividend plus another $1,350 if called away at $3.30 for a total of $900 (3 dividends left) + $1,350 = $2,250 or 27% back in 7 months."

    FYI/  I think $3.50 was a typo. From what I see only $3.30 calls available. Not sure it changes much.

  8. Oil back to $106.10 already, scam is right.  

  9. Phil

    May be in a fight on oil shorts in the short term with all the perceived activity that can be drummed up in the summer time, but those 230k barrels piling up in the December contract will come in to play at some point. Why not just wait until fall?

  10. Thursday’s economic calendar

    12:00 AM ET

  11. On the hour

    09:00 AM ET

    • S&P -0.07%.
    • 10-yr +0.09%.
    • Euro +0.06% vs. dollar.
    • Crude +1.79% to $106.27.
    • Gold +0.36% to $1,265.70.

  12. Retail sales miss, but April revised higher

    08:31 AM ET

    • May Retail Sales: +0.3% vs. +0.6% expected, +0.5% prior (revised from +0.1%).
    • Ex-auto +0.1% vs. +0.4% expected, -0.1% prior (revised from flat).

  13. Digging into the Retail Sales report

    08:52 AM ET · DDS

    • Department stores (DDS, M, SSI, BONT, SHLD, JCP, KSS, JWN) showed sluggish growth in May. Sales in the sub-category fell 1.4% M/M and 2.0% Y/Y.
    • As expected, building material & garden sales (HD, LOW) showed some late-spring strength. Sales rose 1.1% M.M and 4.6% Y/Y.
    • The catch-all miscellaneous store retailers category (ODP, PETM) packed the biggest month-over-month pop of all at 1.8%.
    • Full Retail Sales report (.pdf)

  14. Report: $35B in penalties coming over currency-rigging

    08:52 AM ET · UBS

    • UBS is lower by 1.8% in premarket action after a report from Autonomous Research suggests the bank could face $8 in fines and settlements related to currency-rigging charges.
    • In all, Autonomous sees $35B in penalties, with UBS seeing the largest bill. Coming in at place and show are Deutsche Bank (DB) with $4.4B and Citigroup (C) at $4.3B.
    • Autonomous is basing its estimates on the size of the fines handed out for Libor-rigging. “We acknowledge that our methodology is speculative, but it applies the theory that repeated wrongdoing attracts higher penalties, as witnessed elsewhere.”

  15. Iron ore price outlook cut by Morgan Stanley, miners lower premarket

    08:28 AM ET · RIO

    • Morgan Stanley cuts its iron ore price estimate for this year and foresees a further drop in 2015, as a seaborne surplus grows faster than expected and the level of cost support at Chinese producers declines.
    • Prices are expected to average $105/ton this year vs. $118 forecast in May and $135 in 2013, and average ~$90/ton in 2015, 21% below an earlier estimate.
    • Iron ore has dropped below $92 for the first time since 2012 as mining companies boost output, betting that rising exports to China would more than offset lower prices.
    • The firm downgrades Vale to Equal Weight from Overweight with a $15.20 price target.
    • RIO -2.9%, CLF -2.8%, VALE -1.3%, BHP -1.2%, MT -1.2% premarket.

  16. Supreme Court ruling may make it harder for shareholders to file class action suits

    07:51 AM ET · HAL

    • In the next several weeks, the Supreme Court is expected to rule on a case involving a shareholders’ class action lawsuit against Haliburton (HAL). If it rules in favor of the company, it will set a higher bar for plaintiffs to achieve class certification. Currently, a judge holds a certification hearing to decide whether class status is appropriate. One criterion is that the people must have common issues. If HAL prevails, then the defendants will be able to file a brief with the court demanding that the shareholders have to again seek court approval for class status under a new, tougher standard. If they fail the gain the approval, the case ends.
    • HAL is trying to overturn a 1988 decision, Basic v. Levinson, which is based on “fraud on the market theory,” which postulates that a defendant’s material misrepresentation that affects the price of publicly traded securities is assumed to have been relied upon by a buyer who suffered a loss. In HAL’s case, shareholders alleged that it understated its asbestos liabilities while overstating revenues and the benefits of its merger with Dresser Industries.
    • Other firms facing class action suits that would benefit from a favorable ruling are Pfizer (PFE), Merck (MRK), HSBC Holdings Plc (HSBC), Regions Financial (RF) and Las Vegas Sands (LVS).

  17. Brent crude jumps more than $2 as Iraq violence spirals

    07:47 AM ET · USO

    • It’s purely a fear-factor hitting right now,” as Brent crude jumps more than $2 to $112.29/bbl and U.S. oil adds $1.83 to $106.23/bbl on worries over escalating violence in Iraq.
    • Although very little of Iraq’s crude exports have been affected by the attacks on Mosul and Tikrit, prices are soaring on concern that the violence could spread south to where the vast majority of the country’s production is concentrated.
    • Sunni insurgents overran Tikrit yesterday, threatening the Baiji refinery, which can process 300K bbl/day and supplies Baghdad.
    • Iraqi Kurdish forces reportedly have taken control of the northern oil city of Kirkuk as Iraq army forces flee.

  18. H-P boosted by Goldman upgrade

    07:16 AM ET · HPQ

    • “Our thesis has been proven wrong as H-P management has executed far more effectively than we anticipated,” says analyst Bill Shope, throwing in the towel on Goldman’s Sell rating for Hewlett-Packard (HPQ).
    • “Following H-P Discover in Las Vegas, we walk away incrementally more positive on the progress of the turnaround … Restructuring efforts have gone a long way towards ‘right-sizing’ the cost base, providing a sustained buffer to our secular concerns.”
    • Shares +1.2% premarket

  19. OPEC production levels below demand forecast

    04:28 AM ET · USO

    • OPEC has announced that it has not changed its output target despite a higher demand forecast for the rest of the year.
    • The production ceiling has been set at 30M barrels a day, although the group predicts crude demand of 30.4M barrels in the next half year. The organization answered that rest of demand will be covered by production growth in countries outside the group.
    • Production is still facing challenges though, with turmoil enveloping Libyan output, Iran sanctions, and political unrest in Iraq.

  20. Report: $35B in penalties coming over currency-rigging

    08:52 AM ET · UBS

    • UBS is lower by 1.8% in premarket action after a report from Autonomous Research suggests the bank could face $8 in fines and settlements related to currency-rigging charges.
    • In all, Autonomous sees $35B in penalties, with UBS seeing the largest bill. Coming in at place and show are Deutsche Bank (DB) with $4.4B and Citigroup (C) at $4.3B.
    • Autonomous is basing its estimates on the size of the fines handed out for Libor-rigging. “We acknowledge that our methodology is speculative, but it applies the theory that repeated wrongdoing attracts higher penalties, as witnessed elsewhere.”

  21. Good morning!  

    Don't forget, a weak bounce off a drop from $106.50 to $106 on /CL is .10 and a strong bounce is .20 so we're not too keen on shorting $102.25 as that's right after it breaks out of a strong bounce.  Hopefully though, this is just a weak bounce and we can get back in as we fail $106.

    Indexes already turning south about 0.2% but same levels as yesterday were in play this morning.  This stuff isn't complicated – we do the same thing every day until it doesn't work, then we find the next thing that works and do that until it breaks!  

    Dollar 80.825, gold $1,266, silver $19.28, copper $3.035 (pathetic), nat gas $4.55 and gasoline $3.045.

  22. Phil/LULU – As an example, for the LULU earnings play, if you're bullish going into earnings would you ever consider it prudent to buy a same week out of the money put as protection in case of a big move against you? I realize this goes against the mantra of "Being the House".

  23. Qualcomm target raised to $95 at Canaccord Genuity. 

  24. LULU – Wow, I don't even think I have to explain why this is a huge opportunity to buy it.  Just read this:

    Lululemon unveiled a share-repurchase program of up to $450 million, which it will fund through the repatriation of foreign earnings.  The company recorded a $30.9 million tax charge in the first quarter for the planned repatriation.

    For the quarter ended May 4, the Vancouver, British Columbia, company reported a profit of $19 million, or 13 cents a share, down from $47.3 million, or 32 cents a share, a year ago. Excluding the tax adjustment, per-share earnings for the latest period were 34 cents.

    Revenue rose 11% to $384.6 million.

    Total same-store sales rose 1% on a constant-dollar basis, while gross margin widened to 50.9% for the quarter from 49.4%.

    Looking ahead, Lululemon lowered its earnings outlook for the year to a per-share profit of $1.71 to $1.76, normalized for the 0.22 tax adjustment in the first quarter.

    Chief Executive Laurent Potdevin called 2014 a "transitional year" for the company, and said Lululemon is "on track with the improvements we have set out to achieve."

    We have these guys in our Long-Term Portfolio already but we only sold 5 2016 $40 puts ahead of earnings for $5.90.  LULU is down to $37.18 on this report, down about 16% and now we can sell 5 of the $35 puts for $6 so let's do that and it's not a roll (yet), just a sort of double down as we pick up another $3,000 in exchange for promising to buy 500 more shares at net $29 ($14,500).

    Meanwhile, we'll add 5 of the 2016 $35/50 bull call spreads at $5.50 as well. 

    We'll also add that as a new trade in the Income Portfolio

    While we're at it (as this will have to be an Alert), let's take a poke at 10 USO June $39 puts at .47 in the $25KP and 30 in the STP – just in case oil crashes back over the weekend.  If not, we won't chase into July.  

    In the STP, we'll take advantage of SCO dropping to $24.87 and grab 20 Oct $22/26 bull call spreads at $1.30 ($2,600) and sell 10 of the $24 puts for $1.25 ($1,250) for net $1,350 or 0.675 per $4 spread that's $2.87 in the money with oil at $106.  

  25. By the way, last year LULU earned $1.91 per share and this year, they have revised down their earnings forecast to $1.71 after taking a .21 charge to bring money back from overseas and, they are using that money to buy back 10% of their own stock, which means the same $1.71 will be $1.88 on the new, lowered share structure – even better than that at these prices!  

    Last year, LULU was trading between $60 and $80 and essentially traded there since early 2012.   $1.71 per $38 share is a p/e of 22 but the share buyback drops it to 20 and another 10% growth would be 18 – very nice for a long-term INVESTOR but traders may be in for a bit more pain if the downgrade police attack them.  

    And what DM said!  (you're getting good at this!)

    Oil testing strong bounce at $106.20 – I do like a short if they fail it but not if they get to $106.25 (ie., very tight play here – especially with Nat Gas inventories at 10:30).  

    NFLX/StJ – Hmm, should we bet on the train or the guy who owns the tracks?  Frankly, if I could use my Tivo or On Demand service on my IPad the way I use NFLX, then NFLX would be pointless.  On Demand is fantastic and I can watch things on my IPad, but only at home – same with Tivo.  So, at the moment, NFLX has a contractual advantage the others don't but there's a reason they are scrambling to create original content – they know that advantage won't last past the next round of negotiations because T alone is 10x the size of NFLX with 1,000x more cash.  You think this is dirty?  You ain't seen nothin' yet.  

    Wheee on the RUT – 1,160 again.  Dow all the way to 16,800, /ES 1,940, /NQ already bounced off 3,782 again (same as yesterday) and flying back to 3,800 (same as yesterday).  That means we should play the RUT bullish at 1,160 (same as yesterday). 

  26. NFLX / Phil – Apparently your cable provider is OK with Net neutrality…

    Netflix (Nasdaq: NFLX) said it is partnering with Cablevision (NYSE: CVC) to place storage appliances near its Optimum network, which would allow for the delivery of "super HD" programming and 3D content to Cablevision customers who also subscribe to Netflix.

    Cablevision is the first U.S. cable MSO to join the Netflix Open Connect content delivery network, which also includes Mexico's Telmex, Canada's Telus and Virgin Media and British Telecom in the United Kingdom. Netflix says it doesn't charge ISPs in the program fees to receive its online video programming directly at interconnection points.

    News of Cablevision joining Netflix Open Connect comes less than one month after Netflix announced that Netflix subscribers who are customers of Comcast (Nasdaq: CMCSA) and Cablevision rival Verizon (NYSE: VZ) see download speeds for Netflix TV shows and movies that are faster than those delivered by Cablevision and other broadband providers.

    They don't seem to think that it's a problem!

  27. CMG is on a quick march to 600 before there earnings.  Looks like NFLX passed the baton to them.

  28. Good point by DeLong, StJ. What really cracks me up about these idiots is the "framers" of the constitution had an open door policy to immigration.  The first immigration policies were put in by individual states after the Civil War and then by Congress in the 1880s – 100 years after the Constitution (and the holy Bill of Rights) was written.  Where are those strict interpretations now?  F'ing morons…

    CIM/DC – No, we had that discussion already.  Some trading platforms don't show the $3.50 calls but they exist and you can just change the 3.3 to 3.5 in the symbol and order it or call your broker and tell them to get their act together.  Symbol is:  CIM150117C3.5

    Scam/Bruce – But God bless those rascals, they make us so much money! 

    Waiting/DC – After next week, I'll get more cautious but we should get a nice dip before then and why should we not play for $250 here and $500 there while we wait?   Go back to last Summer's posts, we played in and out from $105 to $112 and back down.  The times we got burned were vastly overwhelmed by the times we caught $1,000 and $2,000 moves.   When I say we made $10,000 per contract on the drop, that's just the straight trade from our conviction short.  Over those 3 months, shorting oil at $110 every time, we must have had 50 times that we made between $500 and $2,000 on dips.  

    LULU/Brill – Well they just had earnings but you are saying "week" and I wouldn't play the weekly anything on earnings – that's just a crap shoot at the best of times.  Our play into earnings was selling the 2016 $40 puts for $6.25 for a net $33.75 entry because we thought THAT would be a great entry.  Despite the 16% drop in the stock, those puts are only $8.20, down $1.95 per share vs the $6.69 per share loss the stock took.  That's why we love selling puts – they have a huge built-in cushion and, though they are down 30% on paper – if we REALLY wanted to own LULU for net $33.75 – we're still 10% above our goal and we'll still make money if LULU finishes over that mark – and that's on an almost 20% move against us!  

    So, in short – BE THE HOUSE – Not the Gambler!  

    NFLX/StJ – That's interesting.  So, apparently, they are putting servers full of shows at all these local locations to cut the download times and network traffic. It's smart but I wonder how the content providers will feel about that?  

    CMG/Rustle – Yeah, too bad we moved to the less-aggressive spread.  We'll still make a ton of money, but it would have been a mega-ton!  

  29. Phil

    what do you think about those June TZA 17 calls. Hang on? 

  30. NFLX / Phil – If there was real competition in the markets as opposed to monopolies or duopolies I am sure that these cable providers would all do that as it makes so much sense for them and their customers. If you had Netflix at home and could choose providers, you would of course pick the one with the best speed since Netflix is most likely your biggest bandwidth demand.

    I was surprised by how much cheaper Internet connections got to be in France now but customers have a choice of many providers there, not just one or 2 like here in most locations. So much for free market enterprise. These guys actually don't believe in free market – they only pretend to. They like monopolies much better….

  31. TWTR rocketing higher to $37.  That's in the Income Portfolio and our $23/40 bull call spread is almost all in the money already (with 18 months to go):

    Like LULU, we took advantage of the "disappointing" earnings to DD on our 2016 $30 puts for a $6.20 average, already down to $5.10 (about 20% in a month).  Again, you don't have to take big risks to make very fast money.  This trade gave us another 20% downside protection with a net $24(ish) entry and yes, it could have gone lower but we have a VALUE we place on TWTR, regardless of what PRICE the stock went to as people panicked out of it.   

    TZA/Jeff – Can't get much worse, I'd give them until tomorrow and pray for a miracle (like reality).  Retail sales sucked this morning but the markets don't seem to care.  There's a 30-year auction at 1pm and that has the potential to spook people.  






















  32. Free market/StJ – Hey, watch that Commie talk!  

    Many factors combine to shape the price of a commodity: its quality, the intensity of desire for it, the labor needed to produce it, the profits sought by the capitalists in whose enterprises the commodity is produced, the weather on the day the commodity comes to market and countless other factors come into play. What different theories do is focus on one or a few factors since taking them all into account would be impossible since they are quite literally infinite. 

    Theories differ according to which of the factors shaping price they focus on. Marx and Marxists, for example, focus on the labor needed to produce a commodity. They recognize the other factors, but believe that special insights into the economy and society become available if one uses a labor-focused approach.

    This approach was first used extensively by Adam Smith and David Ricardo, the founders of economics as a discipline and both avid supporters and even celebrators of capitalism. Marx borrowed (with fullsome praise for them) what they called the labor theory of value.

    But Marx used it in ways Smith and Ricardo had not done. Marx used it to show that the value added by the worker when he/she worked was always greater, in capitalism, than the value of the wage paid to the worker for his/her work.

    That difference between the value added by the worker (realized by the employer when the commodity is sold) and the value paid to that worker is, for Marx and Marxists, the source of profit. They call it a "surplus."

    Capitalism is thus an economic system founded upon the delivery of a surplus by workers to capitalists and that surplus delivery, Marx and Marxists show, has all sorts of consequences for capitalist societies. The production of surpluses by the majority and their receipt and use by a different group of people, indeed a minority, is what Marx and Marxists call exploitation. They find it unjust, they find its economic and social consequences unjust and wasteful of nature and human resources, and they work to change society in the belief that societies can and should do better than capitalism.

    Your "free market advocates" would be more precisely described as devotees of the major theoretical alternative to Marxian economics, namely the neoclassical economics that comprises the mainstream notion of what economics means today.

    Knowing where Marx's use of the labor theory of value took him and his followers (to an anti-capitalist politics), the neoclassical economists decided not to quarrel with how he used and developed the labor theory of value. Instead they decided to denounce it and not use it in any form. That's partly why they renamed the "classical economics" of Smith and Ricardo as "neoclassical economics" which was founded in the 1870s in Europe.

    They focused on a different set of factors shaping prices, namely supply and demand. That is, they focused on individuals' preferences – how much each person wants the different available commodities for sale (the "marginal utility" they derive from each unit of a commodity) and how much each persons wants income from work (the "marginal utility" of each dollar earned) rather than enjoyment from leisure (the "marginal utility" of each hour not having to work).

    They thought prices depend mostly or even entirely on preferences (marginal utilities) and the rules of technology int terms of how much we can get from the available productive resources. They preferred their approach and supply-demand theory over the labor and needed usually to bash the labor theory. 

  33. Oil back over $106.  Time to reload?

  34. LULU adjustment – I am in 2x the Jan 16 $45/55 bull call spreads selling 1x of the $45 puts for net $.82 credit, now $9.30.  Would it be advisable to roll down the spread and the puts at this point?

  35. Wow, totally unimpressive Nat gas inventories jam /NG up almost 0.15 in a minute – that's one nasty trade to be on the wrong side of (which is why we hardly ever play /NG).  I think I might like taking a stab at a short at the $4.70 line but very tight stops above. 

    Oil briefly went over $106 for yet another entry with the same tight stops over the line.  

  36. PCLN…WTF???

  37. Don't forget, it's swimming pool heating month:

    LULU/Rperi – If you are already at 2x I'd just take advantage of the dip to roll the $45 calls ($4.75) down to the $35s ($8.75) and pick up half of that cost by rolling the short $55s ($2.40) to the $45s to get $2.35 back and that means you are spending just net $1.65 to roll your spread to $10 lower strikes (and back in the money).  The put's I'd leave alone as they are $11.50 on the $45s, so your net is $38.50, which is where we are now and 2017s will show up in a few months and you can do a roll then.  At the moment, the Jan $45 puts are $9.20 and the 2016 $40 puts are $8.25 and the $35 puts are $5.50 so figure you will be able to spend less than $2 for each $5 you want to roll down the short puts and that would still leave you in the $10 spread for less than $5.

  38. Phil // Kids
    Thanks for the kiddie suggestion – anymore you can think of please let me know. What you're suggesting is high-div buy/writes. Would you sell puts for an initial entry ?

    CL/ RB
    Well, /CL breaking $106 – could be head fake, but if not – does the /RB idea work in reverse ? i.e. shorting /RB instead of buying a long. 

    NG / through the roof

  39. According to "Flash Boys", CMG is one of the stocks that HFT love to play and force people to pay more for as they are chasing it or get less for it on the sell side because of it's illiquidity.  Many of the shares of CMG trade in a dark pool.  Anyone who hasn't read that book yet, you should.  An incredible eye opening read on exactly how everything works.

  40. Hey Phil,

    I don't have a position in CLF – but its looking mighty attractive here.  But it could be catching a fast falling knife.  Do you think an entry point now is wise?

  41. GSVC & IEP / Phil   I'm looking at these two stocks and would like your opinion

    1. GSVC , Looking at as a way to participate in the IPO market. You have to go directly to their website to get a complete picture, not available on yahoo.  They have options out to 2016 and I was thinking of something like the 2016 $10/15 bcs paired with selling the $10 p's for $2.00 The stock seems to spike when one of their holdings go public, but the stock is trading at a discount to their holdings.

    2. IEP   Why not trade with a sleeze. He seems to get away with anything.  The stock is not widely followed, pays a 5.9% dividend and you could do a Dec buy/write  (wombat) for a nice discount.

  42. Phil,

    How does the departure of the COO at TWTR affect the position? Lot of Mgmt changes goings on there.Thanks as always for the advice.

  43. Phil,

    /NKD—at 15000--short or go long? Looks like when japan is open, there is stealth selling, then when we are open, a slow grind up? Your thoughts appreciated as to levels to trade in the channel. Thank you

  44. Someone please shut Boehner up…damn ignorant jackass!

  45. Lloyd Blankfein: “There's always a risk some exogenous event … that's going to cause people to have to reset their portfolios."

  46. stockb >> IEP
    can't do it. i like to sleep ay night, but thanks for thinking of me.

  47. /YM balancing on 16800

  48. wombat- yep its definitely NOT for a kid's portfolio

  49. SAND
    interesting article and business model, particularly that GLD is sitting at the bottom of the ocean.

    Thoughts ?

  50. LULU/Phil – Thanks Phil for the suggestion.

  51. Luckovich: Steering to the right. :-)

  52. MW Elon Musk tweets about Tesla patent news today 

    Jun 12, 2014 10:17:00 (ET)

    SAN FRANCISCO (MarketWatch) — Tesla Motors Inc. (TSLA) may be about to share some of its patents to encourage other car makers to build electric vehicles. In a tweet late Wednesday, Tesla CEO Elon Musk wrote "Some news about Tesla patents tmrw at 10am," without specifying a time zone. At the company's annual meeting June 3, Musk said he was surprised how few auto makers had built electric cars and added he was mulling over doing something about it involving Tesla's patents. Tesla's investors didn't seem to mind the potential sharing; Tesla shares were up 1.7% to $207.88, flat so far this month

  53. Indices quite weak today – we might have seen the top with SPX 1950 and NDX 3800…

  54. GMCR is like the Black Death in the Middle Ages – a nasty outbreak nearly every other day!

  55. PCLN/Jabob – Are you still messing around with that thing?  

    /RB/Wombat – No, gasoline generally moves with /CL but not a direct relationship.  Certainly I wouldn't short /RB into July 4th – we took a long on them last week at $2.94 and now $3.04 so up $4,200 per contract and probably they'll go for $3.10+ eventually.  You can play it bullish over $3.05 with tight stops for not but the easy pickins trade is done. 

    Dividends/Wombat – Well selling short puts is always a good way to start an entry but you only have $50K to play with so $100K buying power is the most you should be using and just selling puts isn't going to get you too far in a low-vix environment. 

    For example, NLY is $11.50 and pays a 0.30 dividend in March, June, Sept and Dec.  You can sell the 2016 $10 puts for $1.15 and allocate $10,000 to owning 1,000 shares at net $9.85 by selling 10 puts for $1,150 but that's just 11.5% over 18 months on your allocation (still beats the crap out of leaving it in the bank, of course).  On the other hand, if you bought the stock for $11.50 and sold the 2016 $12 calls for .50 and the $10 puts for $1.15 you net into the buy/write at $9.85/9.925 AND you will collect $300 7 times between now and Jan 2016 ($2,100) plus another $2,115 if you are called away at $12 for a total return of $4,215 or 42% of your $9,850 allocation and almost 4x more than if you just sold the puts.  Even if this commitment makes you nervous – you are better off doing 500 of these spreads than selling 10 short puts. 

    Let's add 10 of these (1,000 shares) to the Income Portfolio and the LTP!  

    And, keep in mind, in our Income and LTP Portfolios, these allocation blocks are $50K so committing $10,000 and up to $20,000 (if 2x is put to us below $10) leaves $30,000 on the side (of this particular allocation) to adjust if the trade moves against us.  

    If not, then $4,215 is a solid profit and, of course, once the trade is doing well, we won't have to  worry about tying up the other $40,000 and we can put it to work on other trades.   

    CMG/Rustle – They love stocks that people "THINK" they understand and is widely played – it lets them manipulate the stock around earnings or the news and the sheeple will stampede in and out of it at will.  

    /NG over $4.70 now, so no play at the moment. 

    CLF/Ging – Keep in mind that they MIGHT be found to be in default on their debt (due to cash-flow projections and low iron-ore prices) and COULD go BK – but I think it's far more likely that they work things out with their lenders (who would like to get more than .15 on the dollar) and will be in great shape once prices do come back.  With that in mind, as an initial entry, I like selling the 2016 $10 puts for $1.85 for a net $8.15 entry (40% off) and see how that goes.  

    GSVC/Stock – We just played them:

    Submitted on 2014/06/06 at 2:23 pm

    We were playing GSVC in Sept but we cashed out when they popped early ($16.90 in Oct on TWTR IPO) :

    September 24th, 2013 at 2:34 pm | (Unlocked) | Permalink

    Speaking of worth a toss,  GSVC is worth playing for the Twitter IPO.   At $14.09  I like selling 10 of the Dec $15 puts for $2.30 ($2,300) for the STP and buying 10 of the $12.50/17.50 bull call spreads for $1.80 for a net .50 credit ($500) and a potential upside of $5,500 if they get a good move up.   If not, I'm not expecting much damage.  

    I kind of like them again at $9.87 for the same reason as I liked them then, it's a good way to play Uber and other startups without messing around directly with the IPOs.  

    Since they are back at $9.87, I don't see anything wrong with selling 2016 $10 puts for $2.25 and buying the Jan $10 calls for $1.25 so you net a $1 credit on the Jan $10s and worst case is owning them for net $9. 

    So still about the same price and I still like them.  

    As to IEP, don't forget Icahn is 78 years old, so what does that company look like without him?  Also, look at March/April where they went from $115 to $85 (26%) in 6 weeks – not the kind of thing I gamble my children's money (or my own) on.  

    Charts/Diamond – Interesting but I do prefer simpler charts.  

    TWTR/Jasu – I'm not sure as I don't know what Rpwghani brought to the table but I think generally he's out because he wasn't effective and they'll almost certainly find someone cooler to replace him.  Anyway, he's staying on as an adviser so they're not losing him – they're just gaining a hungrier guy for the job.  

    /NKD/Jasu – If I knew that I'd call it.  But I don't so I won't.  wink

    Boehner/Jasu – Hopefully the voters will shut him up in November but probably not because he's custom-carved his district to grab rich counties that will vote for him and exclude voters that would vote against him:

    His district is so ridiculous (89.1% white, 1.5% black vs 57% to 32% in the 3rd that he walled off) that no one even bothered to run against him in the last election.

    Republicans prevailed by a five-to-three margin in House seats despite losing the popular vote by more than 43,000. In Ohio, only 52 percent of voters cast ballots for Republicans, but thanks to maps drawn in a Columbus-area Doubletree Hotel, referred to by GOP operatives in court documents as "the bunker," John Boehner's home-state delegation swings 12-4 for the GOP.

    Republican redistricting has made a mockery of the ideal of "one man, one vote." To take back the House next year, 100 Democratic voters would have to turn out for every 94 Republicans. "Given the GOP-tilted nature of the congressional map," writes David Wasserman of the Cook Political Report, "Democrats would need to win the national popular vote by between six and seven points in order to win the barest possible House majority."

    You're welcome Rperi. 

    I like that Diamond:


    LOL Wappler!  

  56.  its good day to add to ARIA.  stock down on a note sale, but notes have a conversion price of $12 in 2019.

  57. pcln-- yes… glutton for punishment?

  58. Wombat – and there's always the brands you kids may recognize for a watch list:  MCD, TGT, PG, MDLZ, HLT..

  59. thanks Phil

    thanks scottmi

  60. /TF breaking 1160

  61. You're welcome Wombat. 

    Nasdaq making new lows as AAPL takes a dive.  Others likely to follow.  /TF at 1,160 and /YM just failing 16,800 are good to play.  

  62. CNBC doing a pump job on oil now (right at the $106 line), probably because it's having trouble holding with 90 mins to the NYMEX close.  I think let them pump it and then we can short again.  

    Obama saying all options are on the table in Iraq (including making more Veterans we can later ignore, I suppose).  What we should do is send a massive fleet of drones and just wipe them out in 24 hours and then people will stop complaining about the concept.  Too bad battle robots aren't ready…

    This will be the future of American response – won't that make us popular?  

    Of course, that's pretty much how most of the World already perceives of us already.  Check out the standard issue Afghanistan/Iraq outfit:

    So that's 70 years of progress (and Iraqi troops are pretty much where we were in WWII) – Imagine what 2100 will look like by comparison…

  63. /TF is an ATM 

  64. Tesla Motors confirms open source philosophy • 1:25 PM

    Tesla Motors (TSLA +0.2%) confirms it will go open source with its electric vehicle technology in an effort to disrupt the gasoline car industry.

    In a corporate blog post, CEO Elon Musk says he will hold Tesla attorneys at bay toward competitors who use the EV automaker's technology in good faith.

  65. $1250 run on /TF —- nice. Takin the kids to the Zoo : >

  66. Hey, they're already getting on board with my plan:

    Iraq Signals Openness to U.S. Airstrikes Against al Qaeda, U.S. Officials SayIraq has privately signaled to the Obama administration that it would allow the U.S. to conduct airstrikes with drones or manned aircraft against al Qaeda militant targets on Iraqi territory, senior U.S. officials said Wednesday. The Obama administration is considering a number of options, including the possibility of providing "kinetic support" for the Iraqi military fighting al Qaeda rebels who seized two major…

    LOL – TSLA embraces "Open Source" – great plan, it worked so well for Linux! 

    • Tesla Motors (TSLA +0.2%) confirms it will go open source with its electric vehicle technology in an effort to disrupt the gasoline car industry.
    • In a corporate blog post, CEO Elon Musk says he will hold Tesla attorneys at bay toward competitors who use the EV automaker's technology in good faith.

    Source: The New York TimesOther news:

    19 Reasons To Laugh When Anyone Tells You That The Economy Is In Good Shape

    • April business inventories: +0.6% to 1,728.3B vs. +0.4% consensus and +0.4% prior (revised).
    • Sales +0.7% to $1,337.4B.
    • Inventory/Sales ratio at 1.29.

    Rising Household Debt: Increasing Demand or Increasing Supply?

    Japan April core machinery orders fall 9.1 pct mth/mth

    Mindblowing Fact Of The Day: China Has Over 52 Million Vacant Homes

    Shenzhen New-Home Sales Plunged 48.8% Y/Y in May. Used-home sales drop 30% y/y, citing data from Chinese city's urban planning commission.


    Goldman(GS), Bain To Pay $121 Million In LBO Collusion Settlement

    Oh look – 30% of Iraq's total oil production added today:  Total says output at Angola's Block 17 climbs to 700K bbl/day
    • Total (TOT +1.1%) says a new deepwater floating processing plant boosted production at its Block 17 offshore Angola to 700K bbl/day of oil, making the block TOT's most prolific production site.
    • The Clov field complex, with proven and probable reserves of 500M barrels and production capacity of 160K bbl/day, is the fourth major field development scheme to be brought online in the block; the other three fields in the block – Girassol, Dalia and Pazflor – also are being tapped using FPSOs.
    • The output boost from the latest project would bring TOT a step closer to its production goal of 3M bbl/day by 2017, the company's E&P chief says. - That's MORE than Iraq! 
    • TOT operates the block with a 40% interest, with partners Statoil (STO), Exxon Mobil (XOM) and BP holding stakes between 23.3% and 16.7%.
    These guys clearly don't understand that crude is an INPUT COST for refiners:  Strong crude pricing could set up refiner buying opportunity, Cowen says
    • The refining analysts at Cowen say that although Q2 earnings estimates are coming down and Q3 also could prove challenging, they believe asset quality will be rewarded and see higher crude prices as setting up a buying opportunity in their five favorite sector names.
    • Topping the list is Marathon Petroleum (MPC), which Cowen rates at Outperform with a $120 price target; the firm's other favorites are PBFTSOVLO and WNR.
    • The CEOs of Freeport McMoRan (FCX -1.2%) and Newmont Mining (NEM +1.2%) are both in Indonesia's capital, marking what might be a last-ditch effort to resolve the dispute over a mineral export tax before a new administration takes over in October.
    • FCX CEO Richard Adkerson is in Jakarta again less than a week after talks with Indonesia's new chief economics minister failed to make a breakthrough on the escalating export tax that has halted copper concentrate shipments since January.
    • NEM CEO Gary Goldberg, who was not involved in last week's talks, is in the capital to "demonstrate the company's seriousness in supporting the government's policy to increase domestic smelting."
    • Airline stocks take another beating after yesterday's warning from Lufthansa on pricing continues to sour the mood on the group and the prospect of higher oil prices crops up with Iraqi in chaos.
    • Regional carriers in the U.S. aren't being spared in the broad sell-off.
    • Decliners: United Continental (UAL) -5.7%, Southwest Airlines (LUV) -4.5%, Delta Air Lines (DAL) -5.1%, JetBlue (JBLU) -3.9%, Alaska Air Group (ALK) -3.4%, American Airlines Group (AAL) -6.4%, Allegiant Travel (ALGT) -3.7%, Hawaiian Holdings (HA) -4.1%.
    • GT Advanced (GTAT +4.8%) will be supplying Qatar Solar Energy with its new HiCz 200 furnaces for a 2.5GW manufacturing project.
    • GT asserts HiCz furnaces can produce "longer ingots with greater material uniformity and lower resistivity" than traditional batch Cz furnaces, which in turn "lowers the cost of wafering through improvements in yield, enables higher quality material and is expected to provide a path to higher efficiency solar cells."
    • GT's solar equipment ops, overshadowed lately by its Apple sapphire deal, have had a rough time due to industry oversupply – solar orders only totaled $15M in Q1. But rising end-user demand - Solarbuzz expects the top 20 module suppliers to collectively see 30%+ 2014 shipment growth – could spark a rebound.
    • UBS removes Wal-Mart (WMT -0.2%) from its Most Preferred List.
    • The ratings action follows a general trend of caution on the Bentonville giant from Wall Street firms.
    • Wal-Mart's U.S. same-store sales have decreased for five quarters in a row which has increased the importance of growing the e-commerce business. Last year, the company reported online sales of $10B.
    • Execs with Lululemon (LULU -14%) were on the defensive during the firm's FQ1 earnings call today.
    • CEO Laurent Potdevin says a boardroom fight with founder Chip Wilson is awkward, but not a distraction.
    • On store opening: Lululemon thinks by 2017 it will have 20 stores in Europe and Asia (outside of New Zealand and Australia). Square-footage growth of a mid-teens range is forecast.
    • On margins: The company sees its gross margin rate reaching 50% over the next few years and its operating margin rate drifting to the mid-20s range.
    • The early read for FQ2 is for improved store traffic, but a lower conversion rate.
    • Earnings call webcast
    China's fake numbers can't keep real companies from getting killed on sinking economy:  SouFun -13.7% on price cut, downgrade; E-House, Leju also off
    • SouFun (SFUN) has announced a 40% price cut on subscription fees for secondary listing customers (a high-margin business that's 25% of revenue), Deutsche reports. The firm sees this as a "major downside surprise for the market," and is downgrading SouFun to Hold.
    • Deutsche also thinks SouFun is "facing deteriorating economics around its SouFun card business." It attributes this to aggressive competition in tier-1 cities, and a "land-grabbing strategy in lower-tier cities along with deepening geographical penetration."
    • E-House (EJ -5.8%) and Leju (LEJU -6.6%) are again going in the same direction as SouFun. Shares of all 3 companies fell on Tuesday following downbeat land sale data.
    • LiveDeal (LIVEsays a 35-city ad campaign for its local deals platform "has netted a 244 percent increase in site visits in its first week, compared to site traffic over the same period during the prior month."
    • ~85% of the current traffic to LiveDeal's site is from new users, and ~15% from older users. The company notes the latter figure "represents a significant uptake in returning users compared to the prior month."
    • The volatile microcap's shares soared 3 weeks ago following a strategy update.
    • DreamWorks Animation (DWA) has a lot riding on this weekend's opening of How to Train Your Dragon 2 after recent high-profile misfires from the studio.
    • Analysts see an opening weekend box office take of between $60M and $70M.
    • What to watch: Dragon 2 also opens in 20 international markets this weekend, and even more over the next week, where it will compete with the FIFA World Cup for attention. While many studios backed off from premiering films during the highly-watched soccer tournament, DreamWorks set its dragons loose.
    • DWA +0.3% premarket
    • Prime Music will provide ad-free, on-demand streaming to 1M+ songs to Amazon's (AMZN) Prime subs. Mobile streaming is included, as is an offline download option.
    • As expected, popular Universal Music acts aren't included, and neither are most current hits from other labels. TechCrunch observes only 1 of the top-10 songs in the Billboard Hot 100 is available.
    • In terms of size, Amazon's catalog is roughly on par with Pandora's (P), but much smaller than Spotify's 20M+. Amazon's primary goal, of course, is to keep its Prime sub base (reportedly now above 20M) happy, and to give others a fresh incentive to sign up for the $99/year service.


    Could Apple Cash in on Payments? (Barron’s)

    Why Occupy Movement Was Treated As Terrorism

  67. Fyi on LULU.  The $35P's never reached $6, but the net on the -35P, +35/50 bull call can be done for a 0.20 credit.  I sold 3 for that and trying to sell another 3 for 0.25 credit.  

  68. Are we going to get the 2:15 stick?

  69. DOW/phil – why such a drop on Dow Chemical  today?

  70. LULU/Burr – Good fill.  Doesn't have to be done in a day, of course.  

    2:15/CDT – Won't be a good sign for the bulls if we don't. 

    DOW/Scott – Oil is an input cost.  Also, EU ruling on GMO crops – could go against them.   Not bothering MON though so I think oil is the major factor.  

    Speaking of oil – As expected, we're getting our 2:35 run-up back to $106.50 on /CL and it's a rough short into the weekend but I'd hate to miss the Taliban being driven out of town and oil dropping $2.  

  71. If you are one of those weird sciencey types that believes all of this hogwash about CO2 and global warming please send solar producers my way.


  72. cdtbud—I hope not!


    How about a broken stick — when is the last time we saw one of those???

  73. RUT right to our 1,155 line and now we check the bounce from 1,175 (20 points) so 4 points weak to 1,159 and 8 points strong to 1,163 are our new watch lines.  See – not complicated! 

    Oil with a quick pullback to $106.30 but take it and run at $106.35 as we can always get back in on the breaks back below. 

    Broken stick/Jabob – It's always a tragedy when that happens:


  74. Jabob – Quite a reversal on PCLN.

  75. Well, we said we need to start playing the bounce so let's watch /ES 1,930 for a bullish play over the line with tight stops.  Dow 16,735 over 16,750 would confirm, /NQ holding 3,760 for now and /TF bouncing off 1,155 and at 1,158 so far.  So, if the others confirm and the Dollar stays under 80.70 (now 80.66) – no reason we can't rally back a bit into the close for no reason. 

    Obviously, I'm into taking profits on our index shorts at the moment – we had a good day, why risk it?

    TZA June $17s still disappointing at .10.  We need a 20-point drop tomorrow (1,135).

  76. albo—finally ;-)

  77. I went with Jun $16s. Cost basis is $0.37 and they're trading at $0.26

    Think I should close out or hold until tomorrow?  Obviously mine are fairing better than the $17s since I'm a lot closer to being ITM but not quite sure if I should fold or hold.

  78. Phil,

    What adjustment would you make on the following:

    I sold 5 Jan 16 CLF $18 puts for $3.38. Thanks.

  79. PGNX – BOOM!!!!!!!!!!!!!!!!

  80. EPZM…..nice…Up $300 since my write up!  not including the P/C sale.

  81. TZA/JPH – Like playing Russian Roulette because one big move against you and they're gone.  I'd get out and get Julys if you want to keep playing.  

    CLF/Jcrist – I'd do nothing.   CLF just under $14 and you netted $14.62 so what would you do if your stock was down 62 cents with 18 months to go?  

    Either it gets cheaper and you get a better deal to roll or DD or it gets better and you won't have to worry.  Unless, of course, you were scaling in to a much larger position – then you may want to consider adding more but I'd still wait until it stabilizes first.  If the VIX were high and premiums were strong, I'd feel differently but, at the moment, you're just not getting paid enough to sell puts.  

    PGNX/Pharm – So much fun when they start moving!  

    No stick so far – nothing that's working, anyway.  

    Oil back over $106.50 with gasoline $3.08.  Silver hitting $19.53, gold $1,274 but copper even weaker at $3.01.  Nat gas hit $4.769 but now $4.74.  /NKD at 14,855 with the Dollar at 80.67.

  82. PGNX – there are two gaps to fill there…..and they will be filled.  When, yo no se.  Long PGNX.

  83. Well, if we're finishing low then Asia is almost certain to bail into the weekend and Europe was flat today, so they'd have to catch up too so, in the very least, we'll probably follow-through to the downside into the open tomorrow.  Don't forget, we're expecting at least a 5% correction and this is barely 2% so far.  

  84. Volume still low but looks like up 50% from yesterday.  

  85. Phil,

      I have 4 short 2015 CLF $25 puts (net $18) among others. Should they be adjusted now or wait?

  86. Looks like the 3:40 express about to leave the station!

  87. SPX 1915 or so…..20d MA.

  88. CLF/Kevin – Those are $12.30 and you are on the hook (at net $18) for $7,200.  You can roll them to 10 of the 2016 $18 puts at $6.90 ($6,900) and, since you collected about $7 for your longs, let's call it $3.50 per 2x of the 2016s and that nets you into 1,000 at net $14.50 ($14,500).  So, there's no particular benefit to rolling at the moment and you may want to wait for either 2017 options to come out (more premium) or, if you are assigned 500 at net $18, then you simply sell the 2016 $13 puts ($3.50) and the 2016 $15 calls ($2.50) and you drop your basis to net $12/13.50 – not much better off either.  So, essentially, you own the stock at $18.

    You could consider selling the 2016 $18 calls ($1.60), since they can't burn you until the stock is over $25 and you can stop half at $2 and half at $3 which is not likely to bother you vs making your put money back.  If CLF does keep going down, that knocks another 10% off your net and, of course, you can always just buy the stock to cover the short calls if it goes over $18 for no loss at all and your net would be $9.40/17.20 and you'd still make a double(ish) if they get over $25. 

    Oh and here's the pop!  Better late then never in the manipulation game!  Barely getting back to where we were considering going long so far.  

  89. From Chris Verniman….path of least resistance is…..down from the 2009 lows.

  90. FNSR disappoints  Bought some in after market.

  91. GBP/JPY … WTF???

  92. UGHH ! :-(

  93. Well, they brought us back to down just 0.5%.  Could go either way tomorrow but there was no volume blow-off which usually gives us a reversal.  

    /TF all the way back to 1,161, /NQ 3,773, /ES 1,931, /YM 16,756.  

    Oil $106.85 – going for $107!  Not going to turn the transports around with those numbers.  

    Currencies/Diamond – Euro dove hard against the Dollar and the Pound (and Yen).  Someone must have said something.  

  94. Phil

    When you said "no volume blow off" were you referring to the pop at the end of the day?  So that would usually result in a reversal…ie, to the downside tomorrow?  

  95. Phil – Do you have any updated thoughts on DMND?  I do NOT have a position on at the moment, but I am wondering how far you think they may take it down this time.  Oversold for sure!

  96. From Bloomberg, Jun 12, 2014, 10:21:25 AM

    June 11 (Bloomberg) — Ian Bremmer, president and founder at Eurasia Group, discusses the taking of Mosul in Iraq by Al-Qaeda and what type of support may come from the United States. He speaks on Bloomberg Television’s “Bloomberg Surveillance.”

    Iraqi forces sought to check the rapid advance of Islamist militants who had seized major cities, as Prime Minister Nouri al-Maliki responded to the greatest threat to his government since taking power.

    To read the entire article, go to

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  97. From Bloomberg, Jun 12, 2014, 3:01:58 PM

    Joshua Harman points to Darius Williams’ Nissan Sentra in the junkyard. Photographer: Patrick G. Lee/Bloomberg

    Before dawn on Feb. 23, Darius Williams ran his Nissan Sentra off a North Carolina interstate at 80 miles per hour. A length of guardrail pierced his door, according to the police report, driving the 24-year-old’s body into the opposite back seat.

    To read the entire article, go to

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  98. From Bloomberg, Jun 11, 2014, 1:13:47 PM

    Inside Tesla’s car body factory on June 5, 2012. Photographer: Tesla Motors Events

    The world is on the brink of a serious surge in batteries — and not just the kind that powers mobile phones, laptops and sports cars. Batteries of the near future will power homes and hospitals and even provide relief for the grid, with in an industry that may be worth $200 billion in 2020.

    To read the entire article, go to

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  99. From Bloomberg, Jun 12, 2014, 3:36:31 PM

    Floor hands make a pipe connection on Orion Drilling Co.’s Perseus drilling rig near Encinal in Webb County, Texas. Drilling in Mexico would seem a natural next move for the thousands of wildcatters who have brought a boom to Texas, yet until the violence abates that’s not likely to happen. Photographer: Eddie Seal/Bloomberg

    Oil shale drillers in Texas have had
    to contend with environmental opposition and soaring costs. A
    few miles south of the border in Mexico, Angel Torrez and co-workers duck gunfire sprayed from drug traffickers.

    To read the entire article, go to

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  100. From Bloomberg, Jun 12, 2014, 12:37:46 PM

    Student Julia Macias, right at lectern, a plaintiff and Los Angeles Unified School District Middle School, comments on the Vergara v. California lawsuit verdict, with Students Matter Board member, with Founder David Welch, center, in Los Angeles, on June 10, 2014. Photographer: Damian Dovarganes/AP Photo

    The fight to end teacher tenure is just beginning, said David Welch, the Silicon Valley entrepreneur who backed a California lawsuit in which a state judge ruled the practice was unconstitutional.

    To read the entire article, go to

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  101. From Bloomberg, Jun 12, 2014, 4:57:28 PM

    An Iraqi family fleeing violence in the northern Nineveh province arrives at a Kurdish checkpoint in Aski Kalak, 40 kms West of Irbil, in the autonomous Kurdistan region, on June 11, 2014. Photographer: Safin Hamed/AFP via Getty Images

    U.S. stocks slumped the most in
    three weeks and oil climbed to an eight-month high as violence
    escalated across Iraq. Treasuries rallied on signs the U.S.
    economic recovery remains uneven.

    To read the entire article, go to

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  102. From Bloomberg, Jun 12, 2014, 6:11:49 PM

    Brian Krzanich, chief executive officer of Intel Corp. Photographer: David Paul Morris/Bloomberg

    Intel Corp. (INTC), the world’s largest
    semiconductor maker, raised its forecast for second-quarter
    revenue and said annual sales will increase for the first time
    since 2011 as demand for corporate personal computers picks up.

    To read the entire article, go to

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  103. From Bloomberg, Jun 12, 2014, 12:00:01 PM

    May 22 (Bloomberg) — Marc Faber, publisher of the Gloom, Boom & Doom report, and Ian Bremmer, president of Eurasia Group, talk about U.S. initial public offerings by Chinese companies, the economy of China, the outlook for U.S. stocks and bonds, and investment strategy.
    They speak with Trish Regan on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

    China’s home buyers are being
    offered no-money-down purchases in an echo of the subprime
    lending that triggered a U.S. economic meltdown and the global
    financial crisis.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  104. From Bloomberg, Jun 12, 2014, 7:01:00 PM

    June 12 (Bloomberg) — Bank of England Governor Mark Carney speaks about the U.K. economy, central bank policy and regulation of financial markets.
    Carney, speaking at the Mansion House in London, said the BOE could raise interest rates from a record low earlier than investors expect as he expressed concern that mounting debt related to the housing market could undermine stability. (Source: Bloomberg)

    Mark Carney said rising U.K. mortgage debt may threaten Britain’s recovery as he signaled interest rates might start to rise earlier than anticipated.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  105. From Bloomberg, Jun 12, 2014, 1:32:16 PM

    June 9 (Bloomberg) — Catherine Yeung, Hong Kong-based equity investment director at Fidelity Investment Management Ltd., talks about economies, policies and stock markets of Japan and China.
    She speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    China’s new yuan loans and money
    supply topped estimates in May as the government supports
    economic growth while reining in shadow banking.

    To read the entire article, go to

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  106. From Bloomberg, Jun 12, 2014, 4:16:28 PM

    U.S. stock trading taking place away
    from public exchanges reached the highest level in two years
    this week, just as regulators ratchet up scrutiny of dark pools
    amid concern they’re too opaque.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  107. From Bloomberg, Jun 12, 2014, 4:07:54 PM

    Lael Brainard, a former U.S.
    Treasury undersecretary for international affairs, won Senate
    confirmation as a Federal Reserve governor along with Jerome Powell, while Stanley Fischer was approved as Fed vice chairman.

    To read the entire article, go to

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  108. From Bloomberg, Jun 11, 2014, 8:00:05 PM

    While Americans say their own finances are improving, they aren’t giving President Barack Obama credit. Photographer: Andrew Harrer/Bloomberg

    Americans sense that their lives are getting better at home and at work. It’s when they tune into the news that they grow increasingly uneasy.

    To read the entire article, go to

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  109. From Bloomberg, Jun 12, 2014, 7:01:00 PM

    U.K. Prime Minister David Cameron
    made a direct appeal to European voters in his campaign to block
    the appointment of Jean-Claude Juncker as president of the
    European Commission.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  110. From Bloomberg, Jun 12, 2014, 3:17:29 PM

    Iranian Oil Minister Bijan Zanganeh, asked by a reporter at an OPEC meeting in Vienna yesterday, said the Persian Gulf producer is exporting 1.2 million barrels of crude oil and 300,000 barrels of condensate a day. Photographer: Joe Klamar/AFP via Getty Images

    Iran’s oil exports have risen this year, according to Bloomberg calculations, a trend that threatens to violate U.S. sanctions on the Islamic Republic’s main source of revenue.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  111. From Bloomberg, Jun 12, 2014, 4:03:59 PM
    Osborne to Give Bank of England New Mortgage Controls

    To read the entire article, go to

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  112. From Bloomberg, Jun 12, 2014, 12:58:20 PM

    June 12 (Bloomberg) — Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ, talks about retail sales data for May and initial jobless claims for the week ended June 7 released today. (Source: Bloomberg)

    American consumers paused for breath
    in May as retail sales climbed less than forecast following an
    impressive three-month run, tempering forecasts for a rebound in
    growth this quarter.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  113. From Bloomberg, Jun 12, 2014, 10:44:49 AM

    European Union policy makers may
    reach a decision in the first half of next year on a proposal to
    strenthen the world’s biggest emissions market by curbing
    oversupply, according to a senior EU official.

    To read the entire article, go to

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  114. From Bloomberg, Jun 12, 2014, 9:22:26 AM

    India’s consumer-price inflation
    slowed more than economists projected and factory output
    expanded in a boost for Prime Minister Narendra Modi’s
    government ahead of its first budget.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  115. From Bloomberg, Jun 12, 2014, 6:03:21 PM

    The gap between China’s superrich and the rest is growing dangerously wide. 

    Funny how everyone thought China would get old before it got rich. The opposite seems to be true.

    To read the entire article, go to

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  116. From Bloomberg, Jun 12, 2014, 5:37:52 PM

    They still sell these?

    If you want the pithiest summation of the problem facing modern journalism, here it is: dollars in print, dimes on the Web, pennies on mobile.

    To read the entire article, go to

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  117. From Bloomberg, Jun 12, 2014, 1:07:57 PM

    Let them have their private planes.

    When we talk inequality in this country, we tend to focus on “the 1 percent” — the very-high-income earners who are pulling away from the merely extremely well-off. But a growing body of evidence suggests that the distance between the middle and the bottom may be equally important. Possibly, it’s even more important.

    To read the entire article, go to

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  118. From Bloomberg, Jun 12, 2014, 12:20:29 PM

    Three quick points on congressional leadership contests:

    To read the entire article, go to

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  119. Seagate, Western Digital tick higher AH on Intel’s guidance hike

    06:13 PM ET · STX

    • Seagate (STX) +0.8% AH and Western Digital (WDC) +0.9% after Intel hiked its Q2 and full-year guidance, while citing stronger-than-expected corporate PC demand.
    • Several other names with strong PC industry exposure are also up. Seagate’s PC hard drive shipments fell by 400K Y/Y in the March quarter to 36.2M. Western’s shipments fell by 1.5M to 38.4M.

  120. Cimarex Energy to join S&P 500, +1.5% AH

    05:36 PM ET · XEC

    • Cimarex Energy (XEC) +1.5% AH on news it will replace International Game Technology (IGT) in the S&P 500: IGT will replace XEC in the S&P MidCap 400.
    • Live Nation Entertainment (LYV) and ARRIS Group (ARRS) will replace Masimo (MASI) and Brink’s (BCO) in the S&P MidCap 400, with the latter two dropping down to the S&P SmallCap 600.

  121. From Bloomberg, Jun 12, 2014, 12:52:11 PM

    If they can be civil, surely the rest of us can be, too.

    A new study on political polarization in the U.S., conducted by the Pew Research Center for People and the Press, uses large sample sizes, impressive graphics — and lousy judgment.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  122. Chipotle a rare restaurant gainer after Raymond James hikes price target

    05:58 PM ET · CMG

    • Chipotle Mexican Grill (CMG) bucked the general downward trend in restaurant stocks today, rising 2% as Raymond James raised its share price target to $625 from $560 and boosted its EPS outlook to reflect “tighter assumptions regarding a menu price increase currently being rolled throughout the system.”
    • Shares have gained ~15% in the past three weeks, and the firm thinks CMG can continue higher on continued powerful comp outperformance (~10% vs. flat industry) and dramatically improved margins and EPS growth in H2 2014 (+40% Y/Y vs. +7.6% in Q1) behind the menu price increase.

  123. Bitcoin prices tumble; government to auction off Silk Road stash

    06:40 PM ET · BITCN

    • The U.S. Marshals Service says it will auction off 29K+ Bitcoins (BITCN, BTCS) seized during its investigation of drug marketplace Silk Road. (auction details).
    • Bitcoin prices, above $625 yesterday, have fallen allmost to $550. The Silk Road stash has a current value of ~$16M.
    • Meanwhile, popular Bitcoin wallet/exchange Coinbase says it plans to offer merchant clients an automated means of giving discounts to shoppers who pay in Bitcoin.
    • After handling their first $1M in Bitcoin transactions for free, Coinbase charges clients a 1% fee – easily below the 2%-4% fees typically charged by credit-card processors.
    • Yesterday: Expedia joins Bitcoin bandwagon

  124. Shortfall in skilled workers imperils Canada’s west coast LNG boom

    07:10 PM ET · RDS.A

    • Billions of dollars in British Columbia liquefied natural gas investments are at risk as the province faces a shortfall of ~12K skilled workers, according to Reuters’ projections.
    • More than a dozen LNG export terminals are being considered for the Pacific coast province; among those is a project by Royal Dutch Shell (RDS.A, RDS.B), but the president of Shell’s U.S. subsidiary says he can’t move the project forward “until there’s some clarity on workforce issues and labor availability.”
    • B.C. plans to address the gap by sharply boosting training, more than quadrupling intakes for certain trades, but it may not be enough in some key roles; foreign workers could ease some of the strain, but Canada has clamped down on its controversial temporary foreign worker program.
    • Chevron (CVX) and Apache (APA) also are contemplating a major LNG export project in B.C.

  125. Reports: Metal phone, 2K displays, OIS, folding tablet in Samsung’s pipeline

    06:01 PM ET · SSNLF

    • Pictures said to depict Samsung’s (SSNLF, SSNGY) Galaxy F flagship phone have surfaced. In-line with past rumors – they referred to the phone as the S5 Prime – the pictures show a device with a metal case, a feature users partial to the iPhone’s aluminum cases have long clamored for.
    • Evleaks, generally a reliable source for mobile scoops, reports the Galaxy F will have a 2560×1440 display (also backed by previous rumors), Qualcomm’s top-of-the-line Snapdragon 805 CPU, and a 16MP camera with optical image stabilization (OIS). A September launch is expected. The Galaxy S5 has a 1080p display, and its 16MP camera lacks OIS.
    • Likewise, SamMobile has reported the Galaxy Note 4 (also expected in the Sep. timeframe) will have a 2K display and a 16MP camera with a Sony OIS module. A mixture of Qualcomm and Samsung processors will be used (similar to the S5).
    • Korean media, meanwhile, has reported Samsung wants to eventually launch an 8″-9″ tablet with an OLED display that can be folded twice to create a smartphone-like form factor in terms of height and width (but probably not thickness). An early 2015 launch is reportedly being eyed.
    • The Galaxy F/Note 4 reports come with Apple widely expected to launch 4.7″ and 5.5″ iPhones this fall.

  126. Intel +4.3% AH on guidance hike; Microsoft, AMD, H-P, Nvidia also up

    04:26 PM ET · INTC

    • Citing stronger-than-expected business PC demand, Intel (INTC) now expects Q2 revenue of $13.4B-$14B, better than prior guidance of $12.5B-$13.5B and a $13B consensus.
    • Moreover, the chip giant now expects “some revenue growth” for the whole of 2014, after previously guiding for flat sales; the consensus is for 0.7% growth.
    • Full-year R&D/MG&A spending guidance has been upped by $300M to $19B-$19.4B.
    • The guidance hike follows several quarters of narrowing PC shipment declines, thanks in large part to healthy corporate demand. Windows 7 system purchases tied to Microsoft’s decision to end Windown XP support have played a key role.
    • Other PC industry names are up in sympathy: MSFT +1% AH. AMD +1.4%. HPQ +0.8%. NVDA +0.7%.

  127. Sterling spikes on hawkish Carney comments

    04:25 PM ET · FXB

    • “There’s already great speculation about the exact timing of the first rate hike and this decision is becoming more balanced,” says Carney in the annual Mansion House Speech. “It could happen sooner than markets currently expect.”
    • The previous line is good for about an 80 pip spike in cable, now buying $1.6909, more or less its highest level since the financial crisis.

  128. Stocks slide as crude prices pop, transports lag

    04:25 PM ET

    • Stocks finished with broad losses, as the S&P fell for a third straight session and the Dow shed 100 points-plus for the second day in a row, as surging oil prices and softer than expected economic data sparked some talk of a stock market correction.
    • Crude oil jumped 2% to settle at $106.53/bbl, the highest in nine months, as reports of intensifying battles in Iraq raised concerns about oil supply and the potential for higher energy prices to burden consumers in a lackluster economy; energy and utilities were the only sectors in the S&P 500 to post gains.
    • Shares of fuel price-sensitive airline stocks fell sharply; Delta Air Lines was the S&P’s worst performer, falling 6%, while Southwest Airlines slid 5%.
    • Restaurant stocks also were smacked, on the assumption that if people are paying more at the pump they are less likely to go to a restaurant.
    • The headlines caused plenty of nervousness, but participation remains light, as only 610M shares changed hands at the NYSE.
    • Treasury prices rose amid safe-haven positioning, disappointing retail sales data, and a strong 30-year bond auction; the 10-year note added 14 ticks, sending its yield lower by 5 bps to 2.59%.

  129. Finisar -17.8% AH on weak EPS guidance; JDS Uniphase -2%

    04:19 PM ET · FNSR

    • Finisar (FNSR) expects FQ1 revenue of $320M-$335M, above a $317M consensus. But EPS guidance of $0.30-$0.34 is below a $0.41 consensus.
    • Gross margin pressure is responsible for both the guidance and FQ4′s EPS miss. FQ4 GM was 34.2%, +200 bps Y/Y but -300 bps Q/Q and below guidance of 35.5%. GM is expected to fall to 32% in FQ1.
    • Finisar blames the FQ4 margin weakness on telecom product price cuts and the impact of recently-acquired u2t Photonics, whose products carry a lower GM.
    • Opex +4.3% Y/Y in FQ4 to $65.9M, well below rev. growth of 25.7%. A 39.1% Y/Y increase in datacom product sales (boosted by the investments of Web/cloud service providers) offset a 2.5% drop in telecom sales, and helped drive the revenue beat.
    • JDS Uniphase (JDSU) is following Finisar lower. Other optical component firms that could be hit: OPLK, OCLR, FN, NPTN.
    • FQ4 results, PR

  130. MeetMe +8.7% after reporting record traffic

    03:59 PM ET · MEET

    • 924K unique unique mobile users logged into MeetMe’s (MEET) chat app on Tuesday, with 567K doing so via Android. Both are new daily records.
    • The company thinks its new Friend Suggestions and Icebreakers features (previous) have fueled much of the growth.
    • MeetMe adds total chat activity is up over 60% since enhancements were made in April.

  131. Label expansion for CoreValve System

    03:44 PM ET · MDT

    • The FDA approves Medtronic’s (MDT -0.6%) transcatheter aortic valve replacement (TAVR) CoreValve System for patients at high risk for open-heart surgery. Its original indication, approved in January 2014, is for patients at extreme risk for open-heart surgery. The basis for the expanded label was a Phase 3 clinical trial comparing TAVR using CoreValve to traditional surgical aortic valve replacement. One-year survival in patients receiving the CoreValve System was 85.8% vs 80.9% for patients receiving the traditional procedure. The results were statistically significant.
    • The Medtronic device competes directly with Edwards Lifesciences’ (EW -3.1%) Sapien TAVR system. Last month, MDT agreed to pay EW $750M plus royalties to settle patent infringement claims.

  132. EU ministers back deal on GMO crops, but Monsanto is not impressed

    03:31 PM ET · MON

    • A compromise deal to give EU member states the option of banning genetically modified crops won approval today from EU environment ministers, bringing the EU closer to ending years of deadlock on the controversial issue.
    • The agreement is drawing criticism from both sides: Monsanto (MON +0.2%), who makes the only GMO crop grown in Europe, says it would continue its focus on other markets if the law is enacted as drafted, while the Green Party calls the deal “a Trojan horse” that would open the door to GMO crops across Europe.
    • The European Commission hopes for final deal by year’s end.

  133. Morgan Stanley: Lower iron ore prices could imperil Cliffs Natural dividend

    02:46 PM ET · CLF

    • It’s been a down day for iron miners after Morgan Stanley cut its iron ore price forecast, but the firm sees the potential for even worse damage at Cliffs Natural Resources (CLF -4.1%) because it believes lower prices imperil CLF’s dividend.
    • Given weak pricing, Stanley believes CLF could violate its credit facility’s funded debt-to-EBITDA covenant, rising to ~4x by year-end 2014 vs. the permitted maximum of 3.5x; without a renegotiation of terms, CLF could be precluded from accessing its credit facility, which combined with reduced cash flow generation raises the risk of a dividend cut.

  134. Nike and Adidas try different strategies at World Cup

    02:43 PM ET · ADDYY

    • While Adidas (ADDYY) spent an estimated $70M to sponsor the World Cup, Nike (NKE -0.5%) has gone on a different track to back the soccer stars themselves.
    • The best example is Brazilian forward Neymar who Nike backed early with a $7M/year contract and is one of the favorites to win the Golden Ball award as the tournament’s outstanding player.
    • Social media watchers say the strategy of the Swoosh is proving just as effective as the costly Adidas investments.

  135. Twitter rallies as Street dissects Rowghani’s resignation

    02:36 PM ET · TWTR

    • Twitter’s (TWTR +2.6%) decision to remove COO Ali Rowghani’s position “makes sense” given a slower-than-expected pace to product innovation, writes SunTrust’s Robert Peck. Like others, Peck isn’t surprised by Twitter’s move, given recent personnel changes.
    • The WSJ reports Rowghani’s resignation came after CEO Dick Costolo “decided he wanted to take over the product team and streamline the reporting structure so that he oversaw both product and engineering,” amid rising pressure over slowing growth. Rowghani’s insistence on holding onto the product group “ultimately led to his departure.”
    • Shares have cracked $36 for the first time since Twitter’s May 6 lockup expiration.

  136. Ford to adjust fuel economy ratings on 6 hybrid models

    02:28 PM ET · F

    • Ford (F -1.9%) will drop the fuel economy ratings on six different 2013 and 2014 hybrid and plug-in hybrid models to adjust for inflated figures, according to CNBC.
    • The automaker will also make goodwill payments to close to 200K owners.

  137. Oil companies not rattled by Iraq upheaval

    02:19 PM ET · BP

    • Shares in oil explorers focused on northern Iraq tumble amid spreading violence, yet some oil execs express a perverse optimism that the semi-autonomous Kurdish region could gain more bargaining power with the Baghdad government over oil rights and government revenues.
    • Among oil majors, their Iraq holdings account for small portions of global output but development has been ongoing: BP has a 38% working interest in the Rumaila field in southern Iraq, Exxon (XOM) holds leases on ~900K acres and has development wells in the West Qurna field, Shell (RDS.A, RDS.B) owns 45% and is operator of the Majnoon field in the south, Occidental Petroleum (OXY) is among the developers of the 4B-barrel Zubair field, and Chevron (CVX) holds an 80% stake and is operator of the development-stage Qara Dagh block in Kurdistan region of Iraq.
    • Among smaller producers, shares Genel Energy (GEGYF) and Gulf Keystone (GUKYF) aren’t showing big gains or losses, but DNO International (DTNOF) is ~5% lower.

  138. Nokia buys mobile analytics firm to create personalized maps

    02:13 PM ET · NOK

    • Nokia’s (NOK -0.2%) Here unit is buying Medio Systems, provider of a mobile-focused analytics platform that tracks user activity for apps/services, uses algorithms to predict future actions and personalize content. Terms are undisclosed.
    • Nokia says it’ll use Medio to “create contextual maps and location services that change according to the situation.” Examples include “delivering individual restaurant recommendations to someone ready for lunch, giving drivers routes that match their driving style based on real-time conditions or helping businesses personalize their customer offerings.”
    • The deal follows Nokia’s purchase of A.I./natural language-processing tech developer Desti to create personalized travel search results for Here, which remains locked in fierce battle with Google Maps in both the mobile and embedded/automotive markets.

  139. /CL on steroids
    not letting go, MF

    hope I'm still with you guys next week ; >

  140. Good article ( well – rounded) on oil.  The comments are always interesting to read as both sides of the trade are represented.

  141. Good morning!  

    Dow Futures (/YM) just failing 16,700 and EU looks to open lower (as we thought) so I like them short at the moment.  Oil $107.50 is, of course, very dangerous on the weekend (/CL) but we kept making .25 and .50 yesterday so worth the risk.  

    Gasoline (/RB) makes goaaaaaaaaaaaaaaaaaaaallllllllllllllllll! at 3.10 already!  THAT is too scary to short but tempting now.  

  142. Justice/Scott – Wow, that's some sick stuff.  We forget what it really means when we give up our long-fought Constitutional rights to a police state.  

    A Former Hammer's Lament: It's No Fun to be the Nail

    As Attorney General, Shurtleff saw nothing exceptionable about using military tactics to execute warrants dealing with non-violent offenses. All of this occurred, of course, when he was part of the “who,” rather than the “whom” – when he belonged to the exalted fraternity of official coercion, before becoming a mere Mundane.

    Shurtleff’s perspective on routine acts of state terrorism has changed in predictable ways now that he’s a nail, rather than a hammer.

    Genius statement of the Century: “I think if they’ll do that to me, with my entire life and career in service to law enforcement and public safety, they’ll do it to anybody” – Fmr. UT A.G. Mark Shurtleff

    Blow-off/Jeff – Sorry, could have been more clear.  I meant there was no high-volume, blow-off bottom set.  Usually, when a downtrend is going to reverse, you get a volume spike at the bottom as a buyer or buyers pick a bottom and begin buying whatever people are panicking out of.  Actually, intra-day, you can see what I'm talking about at about 1:45 and again at 3:30 but those aren't really the kind of volumes that signal a major reversal – just intra-day spikes that signaled mini-reversals:


    But that's what you want to look for, a strong bar down on volume that leads to a reversal is USUALLY the mark of a selling reversal.  This is a 5-minute chart and usually I like to see at least 15 minutes (3 bars) before I would consider something a trend so you have the big red bar into volume (1), the reversal box right after it (2) and then, if the next candle forms at the top of the reversal box (3), you can use that as the stop line for a long entry.  

    Almost the opposite goes for shorting – when you see a rise and the volume declines, that is often a sign of trend exhaustion.  You can see that at 11:30, as the volume dies out and you have that last up candle on low volume (1) followed by a reversal (2) and then you can short at (3), as long as it doesn't break back over the bottom of (2) (body, not the spike).  

    When you look at a day chart, it's the same 3 candle rule but now the candles are days or weeks for weekly charts:


    Of course, few of you have the patience to go by weekly charts – but we'll work on that over time!  We had a great indication of exhaustion in December, when I was very concerned that the low volume rally would lead to a correction – which is exactly what I've been saying since the other week, when we cashed in the LTP because – well, because it's the exact same pattern! 

    So this week is the (2) reversal candle on the weekly chart and if next week's candle begins below this week's candle (body), then we can aggressively short below that line.  If not, we patiently wait another week or two for a clearer signal.  

    While you are waiting, I suggest working on a Zen garden with Wombat:

    /TF back to 1,155, which is our expected support line that the 5% Rule predicted (we discussed in Tuesday's Webinar).  Let's not forget that the point was that we had a move from 1,125 to 1,175 (50 points) so a weak pullback of 20% of the run (10 points) to 1,165 was the minimum expected and a strong pullback (40% = 20 points) to 1,155 was going to be the next support.  You can see how well that was behaving here:

    So it's not really bearish (just a normal pullback otherwise) until 1,155 breaks and, of course, there can be a 20% overshoot of the 20-point drop (4 more points) before it's a real break – which is why, in the 5% Rule, we watch the 20%, 40% and then the 50% line – to allow for overshoots.  

    Of course we can play /TF bearish below 1,155 with tight stops above, the point is that, at 1,151, we expect some support so it's a good place to take a profit (if bouncy at all) and simply re-enter on a break below 1,150, rather than hanging on at 1,151 and watching 1,152 and 1,153 chew back your profits!  

    Then, as Fibonacci sequences rule all fluid movements, there are always moves within moves.  So the drop from 1,175 to 1,155 gives us bounces of 4 and 8 points and, as you can see from the chart above, 1,159 and 1,163 were significant – even more so when you consider that we actually bounced at 1,156 (the green candle spike down) so all adjusted up by 1 (usually because of Dollar fluctuations and the Dollar was indeed 0.5% weaker yesterday, which added a point).  

    So all yesterday's action was was a strong bounce off the strong retrace back to 1,155 and now that 1,155 line is in play and, if we're not getting a strong bounce today, it's more likely we're consolidating for a move lower.  

    Speaking of moves lower, oil back to $107.30 for the 2nd run from $107.50 so watch that line as it was a quick $200 before (we expect a bounce at $107.25 and, if not, we can re-enter below but ALWAYS take at least 1/2 the quick money in the mornings).  


  143. Oh, by the way, of course we can play 1,155 for the bounce (/TF) until it breaks.  Our /YM shorts just stopped out with oil at 16,670 (up $150 per contract).  With all Futures trades – you always take quick profits in pre or post-market trading as it can quickly reverse on you!  

  144. Now we're watching our bounce lines to see if we should re-enter a bear play (1,157.5 at the moment).  

    DMND/Diamond – They have a lot of legal issues (shareholder lawsuits regarding improper financial disclosures and lawsuits still with their nut suppliers).  So they still may have to re-state their financials and they've issued a hell of a lot of warrants (at $10) to OAK with 12% notes – that's not the kind of thing a healthy company does.  I liked DMND back when thy were below $15, because that was just silly but, at $26 and losing money for the last 7 Qs, I don't find them very attractive.  Back below $20, they may be worth a look but they are paying $27M a year in interest (through 2020) on sales of $220M.  The best news is they won't have to pay any tax for a long time as they have well over $200M in losses to write off!  wink

    There goes $107.25 on oil!  Now that's the stop, of course.  

    LinkedIn/Wombat – First time I tried publishing there.  Not sure how valuable it is but I figured I'd give it a shot.  

    That's an interesting charts on oil, DC:





    Brent just broke up out of the triangle squeezey thingy today:


  145. There goes 1,155 – now we'll see what happens.  Dow back at 16,670, /ES 1,923, /NQ 3,765 is the laggard at the moment.  

    Wheeee on oil too – $107 is breaking (still shorting, of course)!

  146. Very little resistance on oil back to $106 other than normal support at $106.50.  


    And you guys wonder what motivates me to get up early…

  147. Haven't I been saying this for years?

    Check out this show:

    Wow, I never heard of it.  Too bad it was on the History Channel – more people need to know about this stuff. 

  148. Here's a guy telling us the difference between good and bad discrimination:

  149. From Bloomberg, Jun 13, 2014, 5:49:45 AM

    June 13 (Bloomberg) — Gareth Lewis-Davies, energy strategist at BNP Paribas, examines the threat to oil production in Iraq from insurgent violence as the unrest drives global oil prices higher and looks at how it may impact production decisions by OPEC. He speaks with Olivia Sterns on Bloomberg Television’s “The Pulse.”

    Oil led commodities to a nine-month
    high on concern that turmoil in Iraq will disrupt supplies.
    European stocks fell, while the pound strengthened as Bank of
    England Governor Mark Carney signaled interest rates may rise
    sooner than investors expected.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  150. From Bloomberg, Jun 13, 2014, 6:06:57 AM

    June 6 (Bloomberg) — European Central Bank President Mario Draghi speaks about the unveiling of an unprecedented round of measures to help the euro-area’s record-low interest rates feed through to an economy threatened by deflation.
    He spoke yesterday in Frankfurt at the ECB’s monthly news conference. (Excerpts. Source: Bloomberg/European Central Bank)

    For investors in the euro area’s $1
    trillion government bond market, the takeaway from Mario Draghi’s extraordinary stimulus plan is that interest rates are
    going to stay lower for much longer.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  151. From Bloomberg, Jun 13, 2014, 4:53:03 AM

    June 10 (Bloomberg) — European Central Bank Executive Board member Yves Mersch speaks during a panel session about the euro-area economy and banking system.
    He speaks at the Brussels Economic Forum. (Excerpt. Source: Europe by Satellite)

    The European Union has served notice
    that senior bondholders will be in the firing line for losses
    when banks go bust, yet the law’s fine print leaves room for

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  152. From Bloomberg, Jun 13, 2014, 2:45:29 AM

    Victor Ponta, Romania’s prime minister, speaks during an interview at the Victoria Palace in Bucharest on June 12, 2014. Photographer: Akos Stiller/Bloomberg

    The leaders of Romania and Slovakia,
    two former communist NATO members that border Ukraine, called
    for the European Union to unite in the face of resurgent Russian

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  153. From Bloomberg, Jun 13, 2014, 6:10:47 AM

    Gold was little changed near a two-week high, set for the first back-to-back weekly advance since
    April, as investors weighed whether escalating violence in Iraq
    will increase demand for the precious metal as a haven.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  154. From Bloomberg, Jun 13, 2014, 6:50:46 AM

    June 13 (Bloomberg) — Amrita Sen, chief oil market analyst at Energy Aspects Ltd., talks about the impact of fighting in Iraq on crude oil production and prices.
    She talks with Mark Barton on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    West Texas Intermediate crude headed
    for the biggest weekly advance since December and Brent gained
    as escalating violence in Iraq threatened supplies from OPEC’s
    second-largest oil producer.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  155. From Bloomberg, Jun 13, 2014, 6:10:29 AM

    Since Ukraine’s territorial
    integrity started crumbling in March, the nation’s bonds have
    outperformed regional peers. For Landesbank Berlin Investment
    GmbH, that’s unsustainable.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  156. From Bloomberg, Jun 13, 2014, 5:01:54 AM

    Motorists drive past Royal Thai Army soldiers stationed near luxury hotels on Ratchadamri Road in central Bangkok, Thailand, on Tuesday, May 20, 2014. Photographer: Dario Pignatelli/Bloomberg

    Thailand’s baht rose, erasing its
    losses since a May 22 coup, as an end to seven months of street
    protests and a planned pickup in government spending help
    attract overseas funds to the nation’s assets.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  157. From Bloomberg, Jun 13, 2014, 4:24:26 AM

    China’s one-year interest-rate swaps
    completed their first weekly gain in four on speculation signs
    of an improving economy will delay any monetary easing.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  158. From Bloomberg, Jun 13, 2014, 12:23:32 AM

    Chris Christie, making his first
    appearance on late-night television since a traffic-jam scandal
    erupted this year, joked that he “hypothetically” could defeat
    Hillary Clinton, at least on the dance floor.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  159. From Bloomberg, Jun 12, 2014, 8:50:00 PM

    As New Jersey faces a budget crisis,
    among the biggest challenges are shortfalls created because
    chief economist Charles Steindel’s revenue projections have been
    short four of the past five years.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  160. From Bloomberg, Jun 13, 2014, 4:30:40 AM

    June 12 (Bloomberg) — Bank of England Governor Mark Carney speaks about the U.K. economy, central bank policy and regulation of financial markets.
    Carney, speaking at the Mansion House in London, said the BOE could raise interest rates from a record low earlier than investors expect as he expressed concern that mounting debt related to the housing market could undermine stability. (Source: Bloomberg)

    The pound reached the strongest
    level in 19 months against the euro after Bank of England
    Governor Mark Carney said the institution may raise interest
    from a record low earlier than investors expected.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  161. From Bloomberg, Jun 13, 2014, 4:30:14 AM

    June 13 (Bloomberg) — Jesper Koll, head of Japan strategy at JPMorgan Chase & Co. in Tokyo, talks about the nation’s economy, corporate spending, government and central bank policies.
    He speaks with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    Japan’s Prime Minister Shinzo Abe
    said he aims to start cutting corporate taxes in 2015, reaching
    agreement with senior lawmakers on a core part of his agenda as
    the central bank kept up pressure for sustainable finances.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  162. From Bloomberg, Jun 13, 2014, 12:01:00 AM

    May 27 (Bloomberg) — The Chinese government is pushing domestic banks to remove high-end servers made by IBM and replace them with a local brand, according to people familiar with the matter, in an escalation of the dispute with the U.S. over spying claims. Hans Nichols has more on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Somewhere in China, a man typed his user name, “ghost,” and password, “hijack,” and proceeded to rifle the computers of a utility in the Northeastern U.S.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  163. From Bloomberg, Jun 13, 2014, 1:57:36 AM

    Japan will introduce legislation
    this year to ratify a controversial treaty backed by General
    Electric Co. and other atomic-plant manufacturers seeking
    protection from damage claims caused by nuclear accidents.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  164. Phil, Thoughts on /NG prices.

  165. From Bloomberg, Jun 13, 2014, 4:54:10 AM

    June 10 (Bloomberg) — Lu Ting, head of Greater China economics at Bank of America Corp. in Hong Kong, talks about the world’s second-largest economy, and its government and central bank policies.
    He speaks with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    China’s industrial output and retail sales increased at a faster pace in May, adding to evidence that Premier Li Keqiang’s support measures are stabilizing the world’s second-biggest economy.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  166. From Bloomberg, Jun 13, 2014, 12:16:22 AM

    June 13 (Bloomberg) –- Bloomberg’s David Ingles reports on the Bank of Japan’s monetary policy announcement, leaving its bond-buying program relatively unchanged. He speaks to Rishaad Salamat on Bloomberg Television’s “Asia Edge.” (Source: Bloomberg)

    The Bank of Japan raised its view of
    overseas economies while maintaining unprecedented stimulus as
    Governor Haruhiko Kuroda strives to boost inflation that remains
    short of a 2 percent target.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  167. From Bloomberg, Jun 13, 2014, 5:38:25 AM

    Residents walk past razor wire on the perimeter of the Wonderkop platinum processing plant, operated by Lonmin Plc, in Marikana. South Africa’s economy, the second-largest on the continent after Nigeria, is threatened with recession as a 20-week strike over pay shut the world’s biggest platinum mines. Photographer: Dean Hutton/Bloomberg

    South Africa’s credit-rating outlook
    was cut to negative from stable by Fitch Ratings because of a
    deterioration in the country’s growth prospects.

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  168. From Bloomberg, Jun 13, 2014, 6:34:29 AM

    The Bank of England governor is Marching to his own drum.

    When Canada’s Mark Carney became governor of the Bank of England last year, Avery Shenfeld, the chief economist of Canadian Imperial Bank of Commerce, described him to me as the Ringo Starr of central banking: “He may not be the best drummer in the world, but he’s joining the best band.”

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  169. From Bloomberg, Jun 13, 2014, 6:10:30 AM

    Good morning. Here’s my take on some of the stories driving the debate in politics, finance and social issues across Asia today:

    To read the entire article, go to

    Sent from the Bloomberg iPad application. Download the free application at

  170. Futures marginally lower; turmoil in Iraq continues

    07:01 AM ET · SPY

    • The story is oil which has risen to a 9-month high behind the escalating violence in Iraq, with Iranian forces joining those from Iraq to combat Sunni militants and the White House considering returning to military action in the country. WTI crude +0.4% to $107 per barrel.
    • Europe’s Stoxx 50 -0.7%, and Asia was mostly higher overnight.
    • The 10-year Treasury yield is flat at 2.6% and gold is flat at $1,274 per ounce.

  171. On the hour

    07:00 AM ET

    • S&P -0.13%.
    • 10-yr -0.1%.
    • Euro -0.09% vs. dollar.
    • Crude +0.51% to $107.08.
    • Gold -0.02% to $1,273.80.

  172. Overseas

    06:00 AM ET

    • Japan +0.83%.
    • Hong Kong +0.62%.
    • China +0.93%.
    • India -1.45%.
    • London -0.92%.
    • Paris -0.64%.
    • Frankfurt -0.79%.

  173. BMW, Tesla in possible technology partnership

    05:30 AM ET · BAMXY

    • BMW (BAMXY) says it met with U.S.-based electric car maker Tesla (TSLA) this week to discuss a possible joint operation regarding electric vehicle technology.
    • “Both companies are strongly committed to the success of electro-mobility and discussed how to further strengthen the development of electro-mobility on an international level,” a BMW spokeman announced.

  174. LinkedIn facing privacy rights lawsuit

    04:30 AM ET · LNKD

    • LinkedIn (LNKD) is facing a lawsuit which claims it violated customers’ privacy rights for marketing purposes. The company is accused of accessing users’ external e-mail accounts and downloading contacts’ addresses though the users e-mail address provided when signing up to the site.
    • LinkedIn customers can now pursue damages for revenue it made from using the e-mail address books.
    • The lawsuit calls into question how wiretap laws enacted before the Internet apply to data generated when people send e-mails and surf online.

  175. Intel shares soar in AH trading

    04:01 AM ET · INTC

    • After Intel (INTC) raised its second quarter revenue forecast yesterday, shares climbed as high as 6.6% to $29.80 in extended trading.
    • The second quarter boost came after an increased demand for personal computers, with annual company sales estimated to increase for the first time since 2011.
    • Sales for this quarter are predicted to be approximately $13.7B, compared to an earlier estimate of $13B.
    • INTC +5.6% AH

  176. BlackBerry, EnStream reach deal on mobile payment system

    03:30 AM ET · BBRY

    • BlackBerry (BBRY) has reached an agreement with EnStream, a joint venture between Canada’s three biggest telecom companies — Bell (BCE), Rogers (RCI) and Telus (TU), to provide the infrastructure for a new mobile payment platform.
    • Under the three-year deal, EnStream will use BlackBerry infrastructure so banks and mobile operators can securely keep sensitive payment information on any smartphone able to use near field communication (NFC) tags.
    • NFC tags permit smartphones to communicate with other mobile devices or credit payment systems by tapping the two together.

  177. Report: Google in talks with Virgin Galactic

    02:47 AM ET · GOOG

    • Google (GOOG, GOOGL) is said to be in talks with Virgin Galactic regarding a joint venture that would mutually benefit both companies, Sky News reports.
    • After it set out on its goal to get internet access to billions of people, Google is seeking to put hundreds of satellites into low-Earth orbit. Google sees the opportunity with Virgin Galactic as a means to obtain its vision.
    • In turn, the deal would consist of Google investing hundreds of millions of dollars into Virgin Galactic to develop its space tourism business. Google is also reported to want a small stake in the Virgin Galactic holding company.

  178. Caterpillar under fire with engine lawsuits

    01:59 AM ET · CAT

    • Caterpillar (CAT) is facing at least 15 lawsuits relating to truck and bus engines it sold between 2006 and 2010. The plaintiffs are claiming the engines broke down often, and even in some cases caught fire, although no deaths or injuries have been filed.
    • The company closed its truck and bus engine business for the U.S. market after 2010 due to high costs and small market share.
    • Last year, Caterpillar’s engine business accounted for 60% of its $5.63B operating profit.
    • The news comes after Caterpillar’s settlement this past Wednesday, when the company payed $46M to settle a lawsuit involving a marine engine that caught on fire in 2009.

  179. Friday’s economic calendar

    12:00 AM ET

  180. pcln buying open????

  181. pcln up on the open purchase???

  182. wow, quiet day here.

  183. britkid,

    you need to go to Friday's posting if you want to see action:)