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Tricky Tuesday – Low Volume Rallies Continue to Fool Us

SPY 5 MINUTESome of the people all of the time

That's the basis for this rally – or what's left of it – as we see this pattern almost daily:  A big(comparatively) volume sell-off followed by a "rally" on 1/3 to 1/4 of the volume that sold and then, once we hit a pre-programmed peak (about where we got to in the no-volume Futures), we have a bit of volume selling into the close.  

This is how you can see those charts that show all the "smart money" running out of the market, even as the market goes higher.  Why would they leave?  Why would anyone leave this exciting market?  The answer is, because those fund managers are well aware that, at some point, the music will stop and there will be no buyers to save them then.  Best to get out now and avoid the rush.  

That time was also "different," wasn't it?  We had invented the Internet (well, Al Gore did) and easy monetary policy led to bank mergers and NAFTA ushered in an era of free trade that send tens of millions of jobs overseas, causing profits for US Corporations to soar and those good times were never going to end – until they did.  

SPX WEEKLYIt's very hard to say when a rally like this will finally run out of gas but, when we stop making new highs and we have these BS daily, manipulative run-ups to cover the selling – that's probably a good time to get more cautious.  

As noted on Dave Fry's S&P chart, it's ALL about the Fed and how much FREE MONEY the Fed will pump in and how long they will keep pumping it in, etc.  You would think we'd be tired of the same old song and dance but why should we, when we GET PAID to join in?  

Yesterday, for example, in our Live Member Chat Room, I called for a bottom on the Russell Futures (/TF), saying:

/TF below 1,130!   One would hope that's it.  Playable for a bounce over that line but super-tight stops and you can easily get burned for a very quick $500, so be careful.   Logically, as they are already down 1%, it SHOULD be less likely that they power-move lower and the bounce of 2-4 points (strong/weak) is more likely off the 1%, 10-point drop. 

The 1,130 line gave us a very quick $500 per contract gain just 30 minutes later and then a pullback and then another $1,000 per contract gain that I called a top to at 1:50, when I said to our Members:

There's 1,140 on the RUT for $1,000 – remember, greed kills!  

Oil tapped $102 and NOW it's looking like a fun short (/CL) with tight stops over that line.

That led to yet another $500 per contract win into the close, as oil fell back to $101.50 and, this morning, we're testing $101 again but our prediction is failure and a re-test of $100.70, on the way to $100 – as prediced by our 5% Rule yesterday at 10:03 am.  Knowing what's going to happen in advance is tremendously useful (and profitable) in Futures trading!  wink

We have a LIVE Futures Trading Webinar Today at 1pm (EST) and you can join us for FREE by following this link.  

The same predictive skills we use in the Futures are the ones we use when we're warning you how dangerous and unstable the markets are at the moment but, in the Futures, we're looking at a 5-minute chart and, if we're off by a couple of ticks, it's just a 10-minute wait.  In our Macro View, we're looking back 20 years and a couple of ticks on the quarterly charts can be 6 months of waiting or more. 

Still, my biggest mistake in 2008 was getting bored with warning people that something was very wrong in the Global Markets.  By the time the markets actually fell, a lot of people had become way too complacent and simply were not in a good position to defend themselves as the market started falling hard and fast.    

So, this time around I'm trying not to overdo it – but I am making it a point to constantly remind you that your money is very much at risk amidst this "rally" and that keeping plenty of cash on the sidelines and having good hedges is much more important than trying to squeeze every penny out of the bull side.  

Clearly this time IS different.  Investor Place put up this chart in April and, since then, the S&P has gained another 100 points (5%) putting us 17% over the 17-month moving average - DOUBLE the peaks before the last two major crashes.  

It's funny because TSLA made a move like that yesterday and we immediately shorted the pop in our Live Member Chat Room, simply because a move like that was clearly unsustainable – even if there was some legitimate good news to back it up.  Why is it that something can be so clearly unsustainable over the short term yet, when looking at a long-term chart that is equally unsustainable – people refuse to believe it?  

Well, you'd better believe it – that's all I'm going to say on the subject…


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  1. stjeanluc 

    Are you familiar with ispen a French drug company?


  2. Oil $100.70 on the nose!  

  3. OT:  Does the comment auto refresh work for anyone using Chrome on a Android phone?  I have to manually refresh.  If not, does anyone have a RSS reader for Android that is working with the user/pass system PSW has?  

  4. What`s up with FTR this morning? up big pre-market?

  5. And WIN. Even T and VZ up a lot! 

  6. Update: Apple’s iWatch Patent Has Been Approved

    08:11 AM ET | by BB Research Includes: aapl

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    Portfolio app:

  7. Premarket Gainers / Losers

    09:08 AM ET · WIN

  8. S&P Case-Shiller HPI rises in April

    09:04 AM ET

  9. UBS and Deutsche sucked into dark pool probes

    09:01 AM ET · UBS

    • Disclosed alongside Q2 results, both UBS and Deutsche Bank (NYSE:DB) say they are cooperating with regulators looking into high frequency trading and their dark pools.
    • It was last month NY GA Eric Schneiderman sued Barclays for favoring HFT traders in its dark pool. Since the lawsuit was filed, the number of trades in Barclays LX has about halved, according to Finra, as several major clients have exited.
    • Among those investigating UBS (the largest dark pool operator), says the bank, are the NY AG’s office, the SEC, and Finra.

  10. National Oilwell profit rises 17%, beats expectations

    08:58 AM ET · NOV

    • National Oilwell Varco’s (NYSE:NOV) Q2 earnings jumped 17% Y/Y, driven by strong demand for oilfield equipment; earnings beat consensus estimates but revenue fell short, despite a 12% increase.
    • Backlog at the end of Q2 was $15.39B for the rig systems segment, up 20% Y/Y, and $2.14B for the completion and production solutions segment.
    • New orders in the rig systems business totaled $2.28B on a 14% increase in revenue to $2.37B, while revenue in the rig aftermarket segment added 17% to $785M.
    • On a percentage basis, the wellbore technologies unit saw the biggest gains, increasing revenue 18% to $1.45B.
    • The results represented the first full quarter since CEO Clay Williams took the reins at the company.

  11. New York Times misses by $0.02, misses on revenue

    08:34 AM ET · NYT

    • New York Times (NYSE:NYT): Q2 EPS of $0.07 misses by $0.02.
    • Revenue of $388.71M (-0.6% Y/Y) misses by $1.79M.
    • Press Release

  12. Rayonier lower after cutting guidance

    08:33 AM ET · RYN

    • Pro forma net income of $10M or $0.08 per share vs. $23M and $0.17 one year ago.
    • Forest Resources: Q2 sales of $101M down from $109M. Operating income of $22M up a hair.
    • Real Estate: Q2 sales of $34M up from $13M, and operating income of $28M up from $22M. The big boosts are the result of a sale of 19.5K acres of non-strategic timberland.
    • Outlook: Results from timberland in the South will be above prior year as demand improves, but in the Pacific Northwest and New Zealand, lower prices in H2 thanks to higher log inventories in China will hurt numbers. The bottom line: Forest Resources full-year results will be modestly below prior guidance. In Real Estate, 2014 should be comparable to 2013.
    • Conference call at 2 ET
    • Previously: Rayonier EPS of $0.08
    • RYN -3.3% premarket

  13. AK Steel beats by $0.07, beats on revenue

    08:31 AM ET · AKS

    • AK Steel (NYSE:AKS): Q2 EPS of $0.02 beats by $0.07.
    • Revenue of $1.53B (+9.3% Y/Y) beats by $20M.
    • Press Release

  14. Caesars Entertainment subsidiary retires debt

    08:28 AM ET · CZR

    • Caesars Entertainment (NASDAQ:CZR) announces the completion of a tender offer for subsidiary Caesars Entertainment Operating company to buy back debt.
    • The tender saw 99.1% of an issue of 5.625% notes and 98.0% of an issue of 10.00% notes retired.

  15. Softness for HLF shares continues

    08:25 AM ET · HLF

    • Shares of Herbalife (NYSE:HLF) are down almost 12% premarket on modest volume. Prices have dropped ~$10 from yesterday’s peak of $69.69 in response to its Q2 results that missed consensus views and lower revenue growth outlook.

  16. NPD Group: Slow traffic and squeezed margins for restaurants

    08:16 AM ET · CAKE

  17. Windstream to spin off telecom assets into publicly traded REIT

    08:11 AM ET · WIN

    • Windstream (NASDAQ:WIN) +5.4% premarket on plans to spin off its fiber and copper networks, as well as other real estate, into a publicly traded REIT.
    • WIN’s board of directors approve the plan following receipt of a favorable private letter ruling from the IRS; WIN says the tax-free separation will enable it to reduce debt by ~$3.2B and free up cash flow to invest in broadband.
    • The REIT will lease use of the assets to WIN with an initial estimated rent payment of $650M/year.

  18. Light Macau revenue clips Wynn Resorts

    08:07 AM ET · WYNN

    • Wynn Resorts (NASDAQ:WYNN) improved its revenue per available room in both Macau and Las Vegas to help it beats profit estimates in Q2. Shares of Wynn are lower in early trading due to lighter-than-anticipated revenue from Macau for the period.
    • The company’s Macau business generated revenue growth of 3.2% to $961M and adjusted property EBITDA of $307M.
    • Revenue from properties in Las Vegas rose 12.5% to $451.4M and adjusted property EBITDA gained 18.3% to $135.7M.
    • A conference call is scheduled for 8:30 a.m. ET.
    • WYNN -2.8% premarket to $205.00.

  19. Illinois Tool Works beats by $0.01, misses on revenue

    08:01 AM ET · ITW

    • Illinois Tool Works (NYSE:ITW): Q2 EPS of $1.21 beats by $0.01.
    • Revenue of $3.72B (+3.6% Y/Y) misses by $30M.
    • Press Release

  20. BP -1.7% premarket as Russia sanctions spook investors

    07:57 AM ET · BP

    • After a positive initial reaction to BP‘s solid Q2 earnings report, shares are now -1.7% premarket as investor attention shifts to the company’s warning of the potential fallout from further economic restrictions on Russia.
    • BP says any additional international sanctions imposed on Rosneft “could have a material adverse impact on our relationship with and investment” in the Russian company; the EU is expected to announce new sanctions against Russia as early as today.
    • BP bought a nearly 20% stake in Rosneft last year, and the investment helped boost its Q2 results.
    • BP’s warning comes as it announced that its Q2 replacement cost profit, its main measure of earnings, rose 33% Y/Y to $3.18B from $2.40B.

  21. ICSC Retail Store Sales

    07:55 AM ET · PBJ

  22. UPS dips after Q2 profit disappoints

    07:55 AM ET · UPS

    • UPS (NYSE:UPS) reports global package shipments rose 7.2% in Q2.
    • Segment revenue growth: U.S. Domestic Package +5.2% to $8.67B; International Package +6.2% to $3.25B; Supply Chain & Freight +6.5% to $2.35B.
    • The company sees FY14 EPS of $4.90-$5.00 vs. $5.05-$5.30 (low end) prior and $5.08 consensus.
    • UPS -2.6% premarket

  23. Pfizer lowers guidance after Q2 results

    07:50 AM ET · PFE

    • Pfizer (NYSE:PFE) Q2 results: Total Revenues: $12,773M (-1.5%), GIP: $3,547M, VOC: $2,579M, GEP: $6,513M, Other: $134M; Gross Profit: $10,453M (-2.6%); R&D Expense: $1,714M (+12.0%); SI&A Expense: $3,486M (-2.9%); Operating Income: $5,253M (-6.4%); Net Income: $2,912M (-79.3%); EPS: $0.45 (-77.5%); COGS: 18.2% (+5.1%); Gross Margin: 81.8% (-1.1%); Operating Earnings Yield: 41.1% (-4.9%); Net Earnings Yield: 22.8% (-79.0%).
    • 2014 Guidance: Revenues: $48.7B – 50.7B from $49.2B – 51.2B; adjusted cost of sales: 19.0 – 20.0% (unch); R&D: $6.7B – 7.2B from $6.4B – 6.9B; SI&A: $13.3B – 14.3B from $13.5B – 14.5B; effective tax rate: 27.00% (unch); non-GAAP EPS: $2.20 – 2.30 (unch); GAAP EPS: $1.47 – 1.62 from $1.57 – 1.72.

  24. Plug Power +11% after winning new commitment from Wal-Mart

    07:37 AM ET · PLUG

    • Plug Power (NASDAQ:PLUG) +11.2% premarket on news of a new hydrogen fuel cells distribution center with Wal-Mart (NYSE:WMT).
    • PLUG confirms it received a follow-on GenKey purchase order from WMT to add a seventh GenKey site to the original six-site contract it announced in February.
    • The additional site in Sterling, Ill., consists of 286 GenDrive fuel cell units and is planned to deploy in Q3 2014.

  25. Merck ups earnings guidance after Q2 results

    07:25 AM ET · MRK

    • Merck (NYSE:MRK) Q2 results: Total Revenues: $10,934M (-0.7%), Pharmaceutical: $9,087M (-2.4%), Animal Health: $872M (+2.5%), Consumer Care: $583M (+19.0%), Other: $392M (+9.2%); Gross Profit: $6,041M (-10.2%); R&D Expense: $1,664M (-20.8%); SG&A Expense: $2,973M (-5.3%); Operating Income: $1,404M (-5.5%); Net Income: $2,033 (+117.4%); COGS: 44.8% (+15.0%); Gross Margin: 55.2% (-9.6%); Operating Earnings Yield: 12.8% (-4.8%); Net Earnings Yield: 18.6% (+118.9%).
    • Product Sales: Januvia/Janumet: $1,577M (+2.0%), Zetia/Vytorin: $1,134M (+6.3%), Remicade: $607M (+15.2%), Isentress: $453M (+10.0%), Gardisil: $409M (+6.8%), Nasomex: $258M (-20.6%), Proquad, MMRII & Varivax: $326M (-3.8%), Singulair: $284M (+1.1%).
    • 2014 Guidance: Adjusted revenues: $42.4B – 43.2B (unch); R&D and SG&A: <2013 levels (unch); effective tax rate: 24 – 26% (unch): GAAP EPS: $4.44 – 4.77 from $2.15 – 2.47; non-GAAP EPS: $3.43 – 3.53.

  26. Strong quarter from SiriusXM

    07:21 AM ET · SIRI

    • SiriusXM (NASDAQ:SIRI) reports its total paid subscribers count ended Q2 up 5% Y/Y to 26.3M.
    • The company has the largest trial funnel in its history at 7.3M subscribers.
    • Adjusted EBITDA margin rate +570 bps to 35.7%.
    • SIRI +3.6% premarket to $3.50.

  27. More on Spirit Airlines’ Q2

    06:58 AM ET · SAVE

    • Spirit Airlines (NASDAQ:SAVE) reports its pre-tax margin improved by 350 bps to 21.3% in Q2 with a new cost structure in place.
    • Total revenue per available seat mile rose 4.6% to $0.1246 during the period.
    • The carrier earned an average of $139.90 per passenger flight segment.

  28. Microsoft investigated in China over anti-monopoly concerns

    06:30 AM ET · MSFT

    • Chinese regulators are investigating Microsoft (NASDAQ:MSFT) over anti-monopoly concerns, saying the firm did not fully disclose information about its Windows operating system and Microsoft Office application.
    • China’s State Administration for Industry & Commerce is additionally probing the company’s vice president and senior managers, and has made copies of the firm’s financial statements and contracts.

  29. VZ & T up big this morning .

  30. Ispen / QC – No familiar at all. Maybe Pharm knows them.

  31. From Briefing Trader:


    Windstream: Seeing T, VZ, CTL and FTR; we assume it is in reaction to the WIN REIT news from this morning but we are checking around (10.53 )

    WIN announced plans to spin off certain telecommunications network assets into an independent, publicly traded real estate investment trust (REIT). The transaction will enable Windstream to accelerate network investments, provide enhanced services to customers and maximize shareholder value. The transaction will allow the REIT, which will own Windstream's existing fiber and copper network and other fixed real estate assets, to expand its network and diversify its assets through acquisitions. The company's board of directors approved the plan following the receipt of a favorable private letter ruling from the Internal Revenue Service.


    The foundation problem, 35% face collections. They say credit card debt is down but credit limits have been drastically cut, therefore the number can't go as high.

  33. Oil Lines

    R3 – 103.23
    R2 – 102.66
    R1 – 102.02
    PP – 101.46
    S1 – 100.83
    S2 – 100.26
    S3 – 99.62

  34. Tuesday’s economic calendar

    12:00 AM ET

  35. This shows what's wrong with the system:

    Other people that stand to earn a tidy sum on the merger? Well, Family Dollar’s CEO Howard Levine owns roughly 8% of the shares outstanding, so the deal price would land him with paper gains of about $130 million. Perhaps he deserves it? Not so fast.

    As we said earlier, the entire reason the company was pushed to sell by the activist investors was because its numbers under Levine haven’t been great. The fact that a CEO at the helm of a struggling company is able to harvest such a rich payout is quite in keeping with Piketty’s contention that outsized pay packages for corporate executives—even when there is less-than-clear evidence that they’re deserved—are key drivers of US inequality. On top of that, as if to emphasize the points about the growing importance of inheritance that Piketty makes in his book Capital in the Twenty-First Century, Levine is the son of the founder of the firm, Leon Levine. (We put in a request to Family Dollar asking for comment, but haven’t heard back.)

    Well, surely the deal will lead to a healthier retailer in the long run, right? That’s far from clear. This deal is being financed by roughly $9.5 billion in borrowings. The debt used to finance the deal could result in a credit rating cut for Family Dollar, which is already flirting with junk status, Bloomberg notes. In other words, Family Dollar could be in worse financial shape after the deal, not better.

    Oh, and what’s next for the company? A wave of cost-cutting, aimed at helping the combined dollar store giant take advantage of the significant synergies and efficiencies that the deal creates. While the companies have said they don’t plan on closing stores, cost-cutting waves usually aren’t great for employees.

    In short, this deal—prompted by the hardship of low-income customers—leaves a few well-connected investors, executives, and the bankers who arranged the deal much better off, as the finances of the business, its customers and, perhaps, its employees languish.

  36. Good morning!  

    FTR/Jet – Up with WIN as people realize these Telcos have a lot of assets that are undervalued (which was part of our investing premise in the first place). 

    35%/Shadow – Wow, that's a crazy huge number.  Amazing how this is being ignored.  

    The delinquent debt is overwhelmingly concentrated in Southern and Western states. Texas cities have a large share of their populations being reported to collection agencies: Dallas (44.3 percent); El Paso (44.4 percent), Houston (43.7 percent), McAllen (51.7 percent) and San Antonio (44.5 percent).

    Almost half of Las Vegas residents— many of whom bore the brunt of the housing bust that sparked the recession— have debt in collections. Other Southern cities have a disproportionate number of their people facing debt collectors, including Orlando and Jacksonville, Florida; Memphis, Tennessee; Columbia, South Carolina; and Jackson, Mississippi.

    The Urban Institute's Ratcliffe said that stagnant incomes are key to why some parts of the country are struggling to repay their debt.

    Wages have barely kept up with inflation during the five-year recovery, according to Labor Department figures. And a separate measure by Wells Fargo found that after-tax income fell for the bottom 20 percent of earners during the same period.

  37. Great article, Shiller on tomorrow's GDP:

    gary shilling chart

    In a special report titled 'No Spring Thaw', Shilling warns "the herd is likely to be disappointed."

    Here's why:

    • "Consumer spending is 69% of GDP and it barely grew in the quarter." Real consumer spending was down 0.2% in April, and 0.1% in May. Shilling expects it to rise a modest 0.1% in June based on its correlation with retail sales.
    • Real wage growth has been "absent." The absence of real wage growth failed to bolster consumer spending. "Emphasis has also been on lower-paid part-time jobs. In June, they rose 1.1 million while full-timer positions dropped 708,000."
    • Residential construction was most likely weak in Q2. "The earlier recovery in housing was driven by rentals, not new homeowners who are suppressed by uncertain jobs, low credit scores, the lack of 20% down-payments, huge student loan debts and the knowledge that house prices can and did fall by one-third," he writes.
    • Net exports were weak in April and May. Remember, the ugly Q1 GDP number was primarily attributed to a plunge in net exports, which took 150 basis points from real GDP.
    • "Real federal as well as state and local spending probably continued their declining trends."

    Without a big jump in inventories (which is something I don't consider a positive anyway), Q2 GDP is going to be a lot lower than 2.9% expected by economorons.  As Shiller notes:

    "A low second quarter real GDP number will kill the conviction that the first quarter drop was only an anomaly and it will spawn agonizing reappraisals for the rest of the year. It could put the Fed on hold at least into 2016 and be great for Treasury bonds. But for stocks, look out below!"

  38. AAPL finally knocked back at $99.48.  

    CMG not stopping at $677.

    WYNN has now decided to be happy at $215.

    $100.50 holding on oil as Dollar tops out at 81.26.  A pullback on the Dollar should give oil a little lift.  If they have trouble getting back over $100.60, that is going to be a strong indicator that $100 will fail.  

    Income growth/StJ – Sickening.  Much more so since the GDP is up from $11Tn to $17Tn (54%) during that time and Corporate Profits are up 4x – the money is simply being stolen from the bottom 90% and transferred to the top 1%.

  39. CL – real flushing move on open this morning with no news. Nothing dire in the sector, retail still holding on.  Earnings on Thursday.

  40. Phil, still think NFLX hits 400 before CMG hits 700?  It's a real close call now.

  41. Phil- any thoughts on BIDU?

  42. QUIK – Bouncing back from yesterday's sell off.  Traded out of some of the stock I bought yesterday.  Earnings release tomorrow after the close.

  43. Phil

    Thanks for posting more details. I think I at least convinced you that the economy is way worse than east corridor and west coast extremes think. Thought Texas was doing a lot better, very stupid to think that with the star politicians residing there. 

  44. Retail/Diamond – good article. thanks

  45. Phil // TASR
    Slowmoving – any play over earnings ? ( tomorrow )

  46. diamond

    Keep in mind that every statistic is seen through rose glass. I place a lot on what happens in Idaho Falls Idaho because the economy there is stable. The problem is business is off 50% everywhere and no visible construction. Here in one of the biggest vacation destination traffic is off more than 75%, 2 motels are closed, only one Best Western open and the parking lot is bare again this morning at 6:30.

  47. Couldn't resist selling most of my FTR this morning.  Don't know what happens now, but quite happy with today's gift.

  48. albo – a wise man said, 'you'll never go broke by taking profits'

  49. GALT down 52% today.  Pharm, I hope you were short.

  50. /tf just broke 1145!

  51. Some historical perspective …

    US Flow of Funds

  52. Son of a bitch!  My new computer keeps getting locked up and crashing.  

    This is why I kept my old one for so long – it may have been slow, but at least I could depend on it. 

    CL/Scott – I think they should be OK as they are more necessities than discretionary.  

    NFLX/Rustle – Well, when I said it on the 22nd, they were at $440, so this is just halfway to $400 with a bounce, so far.  

    BIDU/Abhish – I gave some fantastic reasons – take my word for it, but the trade idea for the STP is going to be 4 March $220/185 bear put spreads at $13.20 ($5,280), selling 3 Sept $220 puts at $8.10 ($2,430) for net $2,850 on $18,000 worth of spreads.  We just have to have faith in the rolling process.  

  53. Earnings for today:

    Consensus Estimate – 1.20
    Whisper Number – 1.24
    Average Move – 10.3%
    Priced into Options – 7.8%

    onsensus Estimate – 1.75
    Whisper Number – 1.76
    Average Move – 6.1%
    Priced into Options – 7.25%

    Consensus Estimate – 0.00
    Whisper Number – 0.01
    Average Move – 10.1%
    Priced into Options – 11.21%

    EW bullish on BWLD and PNRA but neutral on TWTR. Options seems to price a big move in TWTR though.

  54. shadowfax – You should run for public office as an “outsider” on a platform promising change! :-)

  55. I hear more & more people are using TWTR. With the win in FB, I wonder. LNKD in failed though, but that is more business oriented & I thought very overpriced like NFLX, CMG etc, etc. My account is a sea of red right now, so I am very hesitant to open any more moves; just close out the longs!

  56. Close out the longs, that is, if they would ever turn green.

  57. /CL-Phil any thoughts on where we are headed now? Is that pop to over 101 a blip or a trend in your opinion? I was hoping to ride it all the way down to 100, not that I haven't already had a good morning, thank you very much for your short call at 102 which I rode down to 100.40 already. Just was greedily hoping to squeeze a bit more when it popped back up here. So, looking for confirmation from you that perhaps we can resume shorting at 101 now. 

  58. Knowing how well CMG is doing, thinking of opening up a restaurant called, $1 Cheaper than Chipotle and putting them next to every CMG location.  Same stuff, just $1 cheaper.  I might make less profit but my stock will be sky high and I'll sell a ton of it.

  59. QUIK/Albo – Very nice.  

    Retail/Diamond – We know it's seasonal, that's why we need to focus on annual changes, not month/month.  

    Seasonality of Retail Sales

    Leverage/Diamond – This is very similar to the 17-month MA chart in the morning post.  Pretty strong warning signs indicating this time might not be so different after all. 

    TASR/Wombat – I love them long and they are not in the Income Portfolio, so let's add them with an aggressive block, selling 20 2016 $13 puts for $3.35 and buying the 20 $10/15 bull call spreads for $1.70 for net $1.65 credit.  TASR is at $11.39, so we are committing to own 2,000 at net $11.35 but, on the other hand, we're getting a $2,300 credit on $10,000 worth of spreads – so this could work out very well indeed if TASR moves up

    In a trade like this, we REALLY want to own 2,000 shares of TASR or 4,000 shares so, even if the stock drops to $8, we simply spend $16,000 (1/3 of a $50,000 allocation block) on 2,000 more shares and we average $9.68 on 4,000 shares ($38,700) and we're down $6,720 at $8.  So that's our FORESEEABLE downside risk vs the more likely (we think) $11,300 reward and it only takes $5,300 in margin (out of $1M+) to give it a spin. 

  60. Phil – Staying way clear over any debate regarding guns and the 2nd Amendment and just considering trading, what are your thoughts regarding RGR (either up or down)?

    Here Comes the Next Big Supreme Court Gun-Rights Case

  61. TASR

    Is this correct TOS is 1.70
    buying the 20 $10/15 bull call spreads for $2.70


  62. FTR/Albo – Wise move.

    GALT/Albo – Maybe a critique of Atlas Shrugged?  I know Pharm was consistently down on them:

    GALT Data out……gonna short that one soon.  Hope they get a spike up…but maybe not. 

    /TF/Ricbah – It broke up for less than a 5-minute candle.  That's why I always wait at least one candle for a confirmation.  

    Speaking of which, oil back to $101 again.

    Good and scary charts Diamond.  

    Earnings/StJ – I like BWLD and PNRA.  TWTR should do well also as it's easy to push to a penny profit by shuffling some numbers around.   PNRA a much better deal than BWLD at the moment and I like that you can sell the 2016 $120 puts for $9.50 and those can be used to offset the Jan $140/155 bull call spread at $7.50 for a net $2 credit on the $25 spread that's $5 in the money to start.  Let's put 5 of those in the Income Portfolio.

  63. Phil new computer

    I have an old one and it barely works now, last year it was slower but fine. Saturday and Sunday I rebooted from CD my big system, never crashed but wouldn't even play video news clips on Yahoo. There is some really creepy shit on the net that all the filters miss. I have heard that the worse problems are with chrome. Change your browser, I hate MSM the most but it improved my old computer so that is it. BTW I even put in a new disc and after 3 tries at loading it would not accept updates so almost everything failed to work, unfixable, old disc back in. 

  64. diamond

    I actually tried to run but was trashed within a week, it was clear it would shut down all chances of medical help. It was implied I was abusing the system. What a wonderful country. 

  65. GALT – Very clever. ;-)

  66. /CL Phil never mind, got my answer and I am glad to have tried before getting the answer. Having a fabulous day trading /CL futures ! 

  67. Phil /NKD

    Good moment to short it?

  68. wow market came unglued any precipitant?

  69. ~~
    Eight-Core 64-bit Processor for Mobile Devices

    Posted on 2014/07/22  by  Circuit Cellar Staff 

    MediaTek has announced the MT6795, which the company is targeting at the high-end Android 4G smartphones and tablet segment. According to the press release, the eight-core processor also supports 2560 × 1600 resolution displays, FDD/TDD LTE technology, 802.11ac WiFi, Bluetooth, GPS, FM Radio, and 2G and 3G wireless networks

  70. Phil,

    Conflicting info on GTAT…..just entered 2016 $10 put for $2.30….your clarification sorely needed….10 contracts initial entry. Thanks as always…..

  71. Interesting that investors and consumers not on the same track:

    `Red/Pirate – If your mix is turning red on this little pullback, you really should be lightening up or rebalancing.  

    Oil/Craigs – Not much point to playing until inventories tomorrow.  Now that they are low in the channel, they don't make a fun short (though we still have SCO and XOM shorts, of course).  The key to winning in Futures trading is NOT TRADING – that's one of the hardest things to master.  Of course you will see it fall $1 or rise $1 – whatever way you wish you were betting, while we wait for a clear signal but it's waiting for those clear signals that give us an 80% winning rate – not jumping in on ever possible move!  

    Less than CMG/Rustle – I have a bunch of good restaurant ideas but I don't know any chefs.

    RGR/Diamond – I'm not convinced of the value up here.  There was a lot of gun buying by people who thought the laws would change so they stocked up.  Nothing really changed and now the market floods with extra used guns and demand for new guns wanes a bit.  On the whole, I simply don't see the point in following all the regs and changing laws that make these stocks so bouncy.  I thought $80 was too high but $56 is not too low, maybe if they get back to low $40s they are a bargain again.  

    TASR/QC – Good catch, thanks.  I fixed it.  

    Computer/Shadow – I only got this one last month and it just started acting up last week.  Very annoying, makes me once again regret my decision not to switch to Mac for my main machine.  I just don't like the keyboard and I prefer my PC trackball – that's the only reason I still have a PC.  I've had my IMac for about 3 years now and have never had a single glitch and my one before that gave me about 5 perfect years before the drive died and gave me an excuse to get a new one (and it started life as my kids' first computer, so it was massively abused before being rescued by me).  

    Futures/Craigs – That's great.  Yes, while I do tell people we don't make calls on Futures when we're not sure, as you can see – with a bit of experience we just scalp those nickels and dimes whenever we want!  

    /NKD/Advill – If the Dollar is topping at 81.30 then you could take a poke at shorting /NKD below 15,700 – especially if the Dow is still red.  

    Unglued/Angel – I don't see anything in particular, I think it's more like the BS run-up is over and time to sell again.  

    GTAT/Jasu – I believe it is fairly certain that Sapphire is not ready for the IPhone 6.  That's going to take a lot of steam out of them but, long-term, I think they'll be fine.  

  72. Phil,

      Could you clarify the PNRA trade? I'm seeing $7.20 for the 2016 $120 puts and 140/155 is a $15 spread, not $25. It looks like about even for the puts financing the spread, rather than a credit.

    Thanks in advance

  73. Does anyone know why, when I try to run anything from youtube, it sends me to and I'm unable to run them.  I can run them in an incognito window but Youtube itself has stopped working.  Possibly it has something to do with Adblock – but I whitelisted and that isn't helping. 


    The news is spreading. I wish I could help this woman. Since last year I have been slammed by 5 collections. It isn't just the collectors but mean hard assed jerks working in billing departments turning you in without reason. Not for the timid but to get corrections you must get vulgar and nasty. Tie up their lines for hours to days. They can dish it out but can't take it. They threaten to call authorities, I laugh at them, say go for it, lets see who gets in trouble.

  75. If you're on a mobile device, it SHOULD be sending you to unless you have told your system to request the desktop site.

  76. Also Phil, you're crazy to buy a PC from an OEM.  You could easily ask several of us for advice on building out your own PC that will give you far better performance for the same cash that will be a hell of a lot more reliable.  Your problem is NOT windows.  Your problem is absolute junk OEM installed garbage and "features" that bloat the hell out of your computer.

  77. Phil

    Check the BCS  140/155 is $15.00

    Is this a good trade at 15.00  ?


    PNRA  11:29 am

    deal than BWLD at the moment and I like that you can sell the 2016 $120 puts for $9.50 and those can be used to offset the Jan $140/155 bull call spread at $7.50 for a net $2 credit on the $25 spread that's $5 in the money to start.  Let's put 5 of those in the Income Portfolio.

  78. Phil

    Just like me and someone else here, forget who, yahoo problems, last week got infected with whatever. I don't even try to figure out what anymore but it is all to do with sending you to some pay service. Spyware detection fails because these are legit but corrupt entities and AAPL is not completely immune anymore although they attack phones and some tablets. Our legal system has sold to any high bid. 

  79. Youtube/Phil: I was having the same problem recently and did a little internet research on it…. went to chrome, history tab and cleaned it all out. Then it worked fine… hope this works for you.

  80. PNRA/Income Portfolio, Kevin – Thanks it is a $15 spread, not $25.  The $140s are $12.80 and the $155s are $6 for net $6.80 at the moment.  As to the short puts, the last sale on the 2016 $120 puts was $7.52, the BID is $7.20 and the ASK is $8.60 – you have to offer $7.50 and wait for a fill – NEVER accept the BS offers your broker throws at you, be aware of what things are actually trading for and offer to buy or sell accordingly.  Of course, if you can't get $9.50 for the 2016 $120 puts, It's not big deal to flip to the $125 puts, which last sold for $9.50.  SO – Let's call that the official trade since $9.50 did not fill on PNRA – it's going to be the Jan $140/155 bull call spread (now $6) with the short 2016 $125 puts at $9.50

    Thanks JPH but this is my desktop.  At least that's a clue.  

    PC/JPH – I appreciate that but my computer is mission critical 24/7 and I need to have a Geek here if anything breaks.  

    Thanks Jbur – I'll try that first.  

  81. That TASR spread filled for me for a credit of 1.20.  2016  -13P  +10/15 bull call.

  82. Phil

    I paid my way through school as a cook. I have talked to old contacts in Montana about a brew and pizza pub. They work almost anywhere I have both the beer and pizza down but no money.

  83. Phil

    PNRA – how did you select the $120 Puts. did you look at the longer term price movement or do you know that is the good value for PNRA based on their financials.

    TASR – $13 Puts – this I know that $10 is a good base for TASR and hence the reason to sell $13 Puts

    BIDU – how do you select different number (i.e. 4 quantity) for the bear put spread and different (3) for the straight put sale. Is it the net delta or just the margin and the cash layout?

    Sometime in one of your seminar I would like if you could discuss live options trading (mostly picking up of the correct strike prices) and also calculating good value price for a company using company financials (I know you like yahoo for that) :-)

    Thanks as always

  84. Didn't work Jbur – but I didn't clean cookies and such as it would suck if my preferences disappeared.  

    Pub/Shadow – Yuch, those are a pain in the ass.   I am interested in things that can be franchised, not something someone actually has to work at!  


  86. PNRA Jan16 $225 short puts $8.80

  87. PNRA
    however I do see $10 asks all over the exchanges. I'll sit on my $9.50

  88. Phil: Cleaning the cookies is probably the trick, it shouldn't change any of your preferences which should be listed under "settings", and not "history".

  89. Phil

    JPH is dead on as the basic problem, delete every program not essential, if you end up with more than a half dozen, your not even close, but my built computer got hit last week, it has 5 under programs and features!

    PUB You have no idea how much I want to work and interact with people, I will never have a franchise and don't take this wrong but I doubt you have enough money or backers to start one.

  90. Quote of the day:

    Adam Grimes, “You do not want to be reinventing the wheel with every trade, but, rather, you want a fixed, disciplined process, and a trading plan that clearly lays out what you will and what you will not do in the market.”  (Adam Grimes)

  91. JPH1121

    What would you recommend for a small ( size) not power computer?


    My wife wants a small computer that will run Microsoft office not a tablet.

    About 12 inches for traveling


  92. i am having the same problem with youtube going to

  93. Phil/PC –  I went through 3 new PCs before settling back into my old Windows 7 machine…not worth the headache.  I feel your pain.  Looking hard at QCOM, CMI and EMN today

  94. Another sign of businesses going bad, This was a large outfit.

  95. KOL seems to be breaking out right now, but some serious resistance around 19.30/19.50. To be watched…

  96. Not surprising – lower income confidence trailing although a good July number:

    The chart below compares Consumer Confidence of consumers with incomes above $50K (red line) and consumers with incomes between $35K and $50K (blue line).  Since bottoming at similar levels at the depth of the recession, wealthier Americans definitely saw a sharper rebound in confidence while confidence among middle class ($35K-$50K) consumers lagged.  In July, however, confidence among middle class consumers spiked by 11.6 points compared to a 0.5 point increase for wealthier consumers.  This narrowed the gap in confidence among both income groups down from 32.3 points to 21.2 points.  One month does not necessarily make a trend, and we have seen similar one month spikes during this recovery that never materialized into a longer trend, but whenever you see a shift like this, it bears watching for signs of a change in the prevailing trend.

  97. – I had the same thing yesterday. I believe it is google doing some background 'pairings' of your use/accounts.. i.e. if you use the gmail app and the youtube app on your mobile device, it seems to assign the mobile addresses to your browser links even on your desktop (if load up gmail or a google login).

    to fix, closed my google apps on my mobile, then cleared my cache on desktop and my desktop internet links for youtube worked normally again.

    this is really invasive and annoying as it would convert the links even in my IE browser on desktop when went to resolve them. FU GOOGLE.  I'm moving more to

  98. Anyone…

    The PNRA bcs above is intended to be the Jan 15's right? 

  99. Only buy windows 7!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

    Buy a cheap laptop like an ACER with Intel processor, buy windows 7 professional and window office or open office if you don't want to pay for office and get rid of every program on it, they come with trash about the same as teaser rates before the subprime crash. Even office 2003 that I bought is miles ahead of anything free. Remember you get what you pay for and there are no free lunches.

  100. BTW Open Office

    Extreme car with the download site used! Most are infected.

  101. Should be care.

    If videos don't work you are infected, if you have me ignored you loose this is second post!

  102. to clarify – moving to from gmail as that is the only google account that I would sign into…which has more and more been mucking with everything in the old chrome way.   p.s. still hate chrome and how it would try to 'own' everything.. like picassa would take over all your photos, and iTunes tries to take over all your pre-existing mp3s.   lots of shenanigans going on with these pervasive products.

  103. scottmi

    Great advice but doubt many will hear you or me.

  104. jeffdoc

    PNRA is jan16

  105. thank you!!!

  106. Hi Phil WYNN is going for 220 again!!!!!

  107. Izvestia:

       Russia May Introduce Term 'Country-Aggressor' in Laws. State Duma may introduce term "country-aggressor" in national legislation, referring to countries that impose sanctions against Russian citizens, cos., citing draft law. Proposal is to ban cos. registered in states defined as "country-agressor" from providing audit, consulting, legal services in Russia. If implemented, this may refer to Deloitte, KPMG, Ernst & Young, PriceWaterhouseCoopers, Boston Consulting Group, McKinsey & Co., citing lawmaker Evgeny Fedorov.


  108. that would murder russian stocks

  109. Thanks yodi

  110. qcmike, I agree with shadow on the Acer (though I like AMD or Intel depending on price versus performance requirements).  AMD will smash Intel every day if you're doing anything requiring the GPU.  Intel is going to be stronger in the processor and power efficiency departments though.

    Phil, you WILL have a more dependable PC if you build it yourself.  My desktop has run perfectly fine with zero formats or significant hiccups and it was built 3 years ago.  My desktop prior to that was replaced when I wanted to upgrade after 4 or 5 years.  

  111. PNRA/Pat – That's a level at which (p/e 16ish) I'd be willing to put my foot down and buy, even if the market was in a 20% correction.  That's usually the basis of my short put targets – the fallback plan is to actually own the stock and become a long-term investor.  Of course, we can roll our puts or we can take an assignment and then sell calls and more puts so, really, we're usually able to net out to a 30-40% discount on a full position over time, which means the real trick is simply picking things that don't lose half of their price (not value!).  

    BIDU/Pat – That 25% is about how uncertain I am that BIDU won't drop a quick $20 and burn us to the downside.  Anything up is no problem but my real worry is BIDU is down to $200 or less in Sep and we have to scramble to roll the puts, so selling 3 feels better than selling 4.  As to the seminar – that's what the Q&A is for!  

    Anvi/Angel – I'll take a look, thanks.  

    PNRA/Wombat – As it's earnings, if you want to play, you'll have to fill something by EOD – keep that in mind.  

    Thanks JBur – Have to wait for after seminar now.  

    Deleting/Shadow – Easier to get a new computer…  As to the franchise, I know I don't have that kind of money, which is why I never do it!  Need a chef with a fantastic track record (of making money) who is willing to spend 6 months getting a new concept off the ground AND investors to set up the first few locations to prove the viability over the next 12 months  Big project – no time.  

    Computer/QC – Sounds like a surface to me.  

    MTube/Jabob – Ah, the plot thickens.  Why is this happening?  Are you also unable to run what you click on on that page and are you in Chrome?  

    Windows 7/Cdel – That's why I bought this machine, I wanted to get the last of the Windows 7 machines (this is a Dell) before I was forced to use Windows 8. 

    Audiogon/Shadow – That's a business I know all about as I used to manage a Stereo Magic in high school.  That's a sign the top 1% are cutting back a bit but also that the way TVs and stereos are these days – there's not enough to differentiate the very high end (though I'm sure you'll disagree). 

    KOL/StJ – I'm still liking BTU for bottom fishing.  Coming off $15 now.  

    With BTU you can sell the 2016 $15 puts for $2.40 and buy the $15/22 bull call spread for $2 for net .40 credit with a possible $5.40 profit (1,350%) in 18 months against $2.75 in margin.  

    Confidence/StJ – That spike is a bit too big for my liking.  It's possible but I'll want to see it confirmed.  Might have been caused by falling oil/gas prices more than anything though unemployment also improving – so I wouldn't write it off out of hand.  

    Google/Scott – Wow, that's super-inconvenient.  I'll see if that works and let you know later.  

    PNRA/Jeff – Yes, Jan 2015 on the bull call spread, 2016 on the short puts.  

    WYNN/Yodi – F them!  

  112. Wombat:  sold the Jan16 125's for $8.80 as well, but I'll be damned if I chase that Bull Call up; the market makers are leaning on me all the way up….. F them.

  113. Thanks Phil // $125 filler at $9

  114. Phil

     You can't buy your way out of problems. You could find someone like me in your area that will do the deeds for you, it will cost but like JPH says it will work great, my built system is about 3 and doing fine with no freeware! My laptop has most all deleted and office professional 2003, it is over 4. I am a little down on AMD because I have run into 3 processor problems over the years, all AMD 0 Intel.

  115. wanna make a quick buck
    TRLA Jan16 $40 puts selling for $4 ( market $3.60 )

    $500 >>> boom

  116. i had the exact same problem as you Phil.

    fixed now thx to Scottmi—thank you!!!

  117. ~~Home price growth is slowing: Here’s why

    Our economy will never recover without housing. This omits 2 very significant points. Middle income down must surge and one must realize the truth in lending law has made 70% of owners to not only not upgrade but not qualify for the loan they have now. That means they can't sell. These issues cause another couple problems, lack of affordable starter homes by sale and building costs are way to high to produce homes worth their cost.

  118. This video thing is getting worse, mine stopped working again, deleting browsing history got it working again, that was only 1/2 day of use since deleting yesterday.

  119. Phil // TRLA
    So, I'm in. I don't really trust the analyze tab, so I wanted to run this by you.
    -30 BRCS 70/80 ( + 2.25 )
    -10 Jan16 $40 short puts ( $4 )
    -10 Jan16 $70 short calls ( ( $10.80 )

    I was experimenting with backing all this with a BLCS Jan15 60/70 ( -$4.15 )
    and the analyze tab is kicking back a no loose scenario ( pushed forward to Jan15 )
    ( 10% down = +$8K, 10% up = +$33K )


  120. Sold 10 IRBT Mar15 P33 @ $4.90 … MM sold them to me them above the mark! :-)

  121. Wombat

    What's a BLCS?   = Bear Call Spread?

    And whats a BLCS?



  122. Hey Phil, can you explain the jump in CLF today.  I see this so wondering if you can yea/nay it?  Thx.

    12:32 pm Cliffs Natural Resources: Casablanca Capital announces it received 'overwhelming' shareholder support for change at Cliff Natural Resources; all six nominees on Casablanca's majority slate elected to Cliffs Board of Directors (CLF) :

  123. Wow, sentence structure sucked! ;-)

  124. I'm trying to buy the PNRA -125P +140/155 bull call for a credit of 3.25.  No fill yet.  Not a combo order.  Just sayin.

  125. For earnings, I am playing TWTR with a 38.5 calendar – selling this week against the August strike. I skipped next week because the August options should retain more value. This should cover a 20% move to the upside and about 15% on the downside. Small and cheap bet (I don't have a lot of confidence either way) that could pay well if they don't move much. 

  126. BRCS > Bear Call Spread
    BRPS > Bear Put Spread
    BLCS > Bull Call Spread
    ?BLPS > Bull Put Spread

    Phil likes when you write them out, but I'm lazy ; >

  127. Phil / POO
    CLF // my artificial buy/write just jumped 32% >> only 10 contracts
    What does one do ? 
    A >Cash it all – wait for it to normalize ?
    B>Wait, and then DD
    C>Nothing ?

    pleased don't say C

  128. wombat…isn't it always, "when in doubt, sell half"?

  129. i'm not in doubt – just confused ; >

  130. JPH wombat

    When in doubt sell half except when up 30% in 10 minutes sell 100%, it is unsustainable!

  131. Some Guy Adami trading thoughts (FWIW):

    IWM has been in a $108/$120 channel since February. However, he does expect it to revisit $108 first (before heading back to $120).

    If AMZN breaks $318 he thinks it will revisit $285;

    He suggest going long WYNN above $225.

  132. CLF – bought back my naked Jan2015 $18 short puts for 28% gain.  dynamic times and company is probably going to make some changes.. don't need more from this trade at this time. nice to free up the margin.   

  133. diamond IWM

    I have a rising channel that indicates a short at app 114.13 before the close today, not sure if I can find a cheap enough option for me but looking. You might consider Aug 1 114 put hopefully @.90. I need like a dime.

  134. phil,

    i saw your new trade on tasr.  from a prev. rec i am short 10x jan6 15 puts @ 3.00. i think you suggested to wait on a bcs as it might go down…that said i would appreciate your thoughts on adding the addtl spread and also changing the puts………..tks

  135. Phil – Re: “I don't know any chefs.”

    What? I thought you were a foodie! ;-)

  136. Is everybody bidding BTU higher? Up over 4% today…

  137. diamond
    IRBT MRCH $33 / $5 Filled

  138. WTF is going on with irbt today?

  139. IRBT – Big fail of that 34.75/35 support area… I wonder if we revisit the 30/31.5 zone of support again. On my watch list!

  140. Aaah … it is now obvious why the MM sold me the IRBT Mar15 P33 @ $4.90 (which was 25-40 cents above the mark). MM’s sure do crush the joy out of everything! 

    MM paraphrasing Seinfeld’s Soup Nazi: “No victories for you!”

  141. JPH

    No news as far as I can tell, but somebody sure pulled the trigger after it was up near $36.40. Really needs to hold here or were going to $30!

  142. About 1/3 of IRBT shares sold short.  Could be good, could be bad….

  143. diamond

    I seriously think we are on the edge of a cliff, yesterday I missed an oil overnight short by a few and today IWM dropped early so there is very nervous money out there. TLT is crazy manic and the buck is a tad too high. Time to really hedge or sell, even the losses.

  144. IRBT – No worries, plenty of margin to add and I am protected to the 52 week low. Besides, theta is on my side. Chomp, chomp!

  145. shadowfax – I agree being well hedged (or in cash) right now is essential. However, I cannot resist trading if I think the risk/reward is in my favor.

  146. Diamond // IRBT
    Don't know what is was, but I'm on your boat. Technicals are turning up as we speak.

  147. wombat/honey badger – Did you close the TRLA trade at a loss?

  148. IRBT / Wonbat – Making LOTD now so not sure what technicals are looking up. I still see it weak right now. On the other hand, this is such a volatile stock as shown today when it went from being up to down $1.50 that predicting tomorrow's price is nearly impossible. That means that trying to catch a bottom is likely to be hard!

  149. diamond – // TRLA
    unfortunately so. I can't believe the stockholders are still hanging onto this.
    I went around the backdoor ( see position above ) to make 2x my money.
    HoneyBadger don't like to lose money – he'll go after em again anyway.
    He don't give a shit.

  150. StjeanLuc- r u playing any earnings today. Should got in on that AMZN shorts.

  151. TRLA/Wombat – Nice call, though I'd take the quick money and run as things can go crazy overnight.  

    Lending law/Shadow – That's a very good point.  Doesn't do you any good to sell a home if you don't qualify for a mortgage on a new one.  I wonder how many people get trapped by that?  

    TRLA/Wombat – It's fine unless they get another offer for more.  I like the short strangle but I wouldn't go with the bear put spread – too much risk for little reward.  30 of those is $6,750, same as just selling 5 more of the spreads – not sure what you accomplish since the short $70s pay your $10.80 below $70 while the spread only pays you $7.75.  I don't see how there can be a no lose scenario with naked calls – only if your 10% theory holds.

    IRBT/Diamond – Hopefully a bottom at some point.  

    BLCS/Gerry – You are right, we should not let Wombat get away with making up terms.  cheeky

    CLF/Jeddah – Casablanca intends to break up CLF and "unlock value," which shareholders are happy about.  We're thrilled because we are long-time CLF players but I wouldn't chase it. 

    PNRA/Burr – When the stock is climbing like PNRA is, you can buy the $140s first and then buy the $150s as the momentum slows.  It's up $3 since we picked it, the spread had a net 25 delta so there's .75 already!  This should be it though ($147.50) into earnings.  

    I hate to think I move the market that much but we put up the bullish trade at 11:29 and then, just after 2, we discussed it again in the webinar.

    CLF/Wombat – I think they'll test $20 but that's going to be hard to get over.  Still, as I'm sure you know from the way I mention it over and over and over again, CLF is one of the most undervalued stocks out there so I'd be inclined to let it play out.  

    TASR/Mill – I wouldn't worry about the short puts, when 2017 comes out, then you can roll them.  On a bull call spread, I certainly like the $10/15 spread for $2 as it's just .50 in net premium.

    Chefs/Diamond – I'm not the kind of foodie that's a groupie for chefs.  Chefs work for a living, so we're not usually in the same place at the same time socially.  Of course I've met plenty of them, but when I say I know someone, I mean like I actually socialize with them, not that we met at a party kind of thing or he came out to meet my table in his restaurant.  If that's the criteria – I know hundreds!  

    There's $100 on the /NKD – now I can go out for sushi!  

    BTU/StJ – ACI with good earnings this morning.  

    IRBT/JPH – 33% short now.  Could be fun with an upside surprise down the road. 

    LOL Diamond:

  152. ARIA – for those of you still riding this turkey with me, The Street thinks it's going to breakout. One can only hope…

  153. Phil trapped

    I have heard nothing about those caught selling and unable to get a loan for another but literally millions are not selling because of it and that prevents finding a better job somewhere else and starter homes on the market.

  154. Phil // TRLA
    I think your referring to Call Spread – not a Put spread. The Dec 70/70 bear call spread gave a credit of $2.25 and it's $8 in the money.
    I added your 'strangle' of Jan16 $70 short calls / $40 short puts 

    Do you still think thats redundant or overly aggressive ?

    ""the bear put spread – too much risk for little reward.  30 of those is $6,750, same as just selling 5 more of the spreads – not sure what you accomplish since the short $70s pay your $10.80 below $70 while the spread only pays you $7.75.  I don't see how there can be a no lose scenario with naked calls – only if your 10% theory holds.""

  155. Pharm // ARIA
    I got out a while back. What would you suggest – just straight shares or a spread ?

  156. Earnings / Abish – See this comment:

    Small bet on TWTR!  Like I said, I don't have any conviction either way, but it's cheap bet!

  157. TLT $116.  Actually what we expected with a lot of notes to sell this week.  

    Obama about to announce more sanctions against Russia.

    EU agrees to additional sanctions on Russia

    • The EU agrees to implement new sanctions on broad sectors of the Russian economy, in an escalation of Europe's response to allegations that Russia is fueling violent conflict in eastern Ukraine; the U.S. is expected to follow suit.
    • The measures target four economic sectors: finance, dual-use equipment that could have military applications, arms and oil production equipment.
    • Their intent is to restrict the ability of Russia's state-owned banks from raising financing on European markets; the measures also will place an embargo on the arms trade and set restrictions on exports of militarily sensitive goods as well as equipment to modernize oil drilling and exploration.
    • An indirect consequence of added sanctions is the potential legal risk presented by dealing with Russian companies while sanctions are in place, particularly for big companies and investors; though the sanctions are not supposed to affect existing contracts, European companies could be wary of delivering goods and services under their terms.

    Time to sell out of Brazil's equity rally, strategist says

    • Brazil’s equity market has soared since mid-March, when the buzz first began that Pres. Rousseff might lose in the October elections; the iShares MSCI Brazil Capped ETF (NYSEARCA:EWZ) has jumped ~30% since then and has gained 16% YTD.
    • Part of the rally is propelled by optimism that the state-owned sector, including Petrobras (NYSE:PBR) and Electrobras (NYSE:EBR) will operate better with a new, more pro-business government; iron ore producer Vale (NYSE:VALE), whose fate is tied to China, is the only high-profile underperformer, not even breaking even this year.
    • But strategist Geoff Dennis is skeptical of the Brazilian rally, and thinks it's time to sell; the new government is not likely to have a big mandate, the election is too close to call at present, and Brazil is no longer cheap, trading at 11.2x forward earnings a 33% premium to its recent average of 8.5x.

    Moody's cuts Deutsche Bank credit rating

    • Deutsche's (DB -0.5%) long-term debt and deposit ratingsDB)+to+A2%3B+Profitability+Dragged+Down+by+Litigation,+Legacy+Costs/9696756.html" target="_blank">are cut to A3 from A2, with Moody's noting the bank's "modest" profitability as being dragged down by litigation and restructuring costs and legacy losses, not to mention the bank's high dependence on capital markets earnings. The outlook remains negative.
    • Finding valuations somewhat "stretched" in 15-year mortgages, American Capital (AGNC+0.1%) CIO Gary Kain takes holdings of that paper down to 38% of the total portfolio as of the end of Q2, from 48% at the end of Q1. The money goes into 30-year mortgages, with that allocation rising to 57% from 46%.
    • Webcast and presentation slides
    • Looking ahead, management continues to see agency MBS as looking more attractive than other fixed income products, noting continue sharp tightening in investment grade corporate paper spreads while mortgage spreads have increased over the last two years – this despite superior liquidity and financing in mortgages.
    • Liking what it sees in last night's earnings report, Wunderlich upgrades the stock to a Buy.
    • Previously: American Capital +1.3% after reporting a big Q2

    BP reiterates long-term Russian strategy after sanctions news

    • While BP (BP -3%) earlier today became the first big western company to openly admit that sanctions against Russia could hurt its business, BP execs later were eager to justify their long-term commitment to Russia as well as the rationale for maintaining a position in the country.
    • "Russia is the largest oil and gas producing country on the planet, and the world is going to to need 40% more energy between now and 2035. That’s why you can see many, many, many international companies working in Russia," CEO Bob Dudley says.
    • It's true that Exxon (XOM -0.4%) and Chevron (CVX -0.2%) are notable among other oil majors which hold minority interests and strategic partnerships with Russia oil companies, but BP’s exposure makes it much more susceptible to political headwinds via its associations with Rosneft (OTC:RNFTF), says Jasper Lawler of CMC Markets.
    • One top 20 shareholder in BP also worries for the future: “The situation is very uncertain… the worsening relations are a net negative for BP.”
    • MarkWest Energy (MWE +0.4%) is upgraded to Buy from Hold with an $83 price target, up from $68, at Wunderlich after recently providing a positive operations update that should instill greater confidence about its execution plans.
    • The firm says MWE is developing a premier midstream footprint in the Marcellus and Utica plays, with 12 major projects under construction of which five are expected to be completed this year; much of 2014 capital needs already are pre-funded, the firm adds.
    • As asset utilization ramps up, Wunderlich believes accelerating cash flows will generate a long-term and sustainable double-digit growth trajectory.

    Reuters: U.S. condensate oil export requests put on hold for now

    • The U.S. reportedly has put on hold two companies’ requests for permission to sell condensate, effectively stalling an industry push for U.S. exports of the expanding glut of oil.
    • The delay may give the Commerce Department more time to put together some form of comprehensive public guidance about what kind of oil can or cannot be exported, answering the industry's plea for clarity; sources tell Reuters they think it could occur within weeks.
    • The news last month that Pioneer Natural Resources (NYSE:PXD) and Enterprise Product Partners (NYSE:EPD) had been told that putting condensate through an advanced stabilizer was sufficient processing to export it without a license created a storm of confusion and questions

    Electric utilities get no jolt from improving economy, sales continue weak

    • Americans are plugging in more gadgets than ever, and the U.S. unemployment rate has been improving, but these trends have provided little help for the country's electric utilities.
    • U.S. electricity sales look anemic for the seventh year in a row, prompting some executives to abandon their century-old assumption that electricity use tracks overall economic conditions, according to a WSJ analysis.
    • The diverging trends could pose a problem for utility companies, which often need to expand sales volume yearly just to maintain their expensive equipment.
    • The U.S. Energy Information Administration says it no longer foresees any sustained period in which electricity sales will keep pace with economic growth.


    • Chesapeake Energy (NYSE:CHK) says it plans to spend $1.26B to buy back all outstanding preferred shares issued by its CHK Utica unit to simplify its balance sheet and eliminate ~$75M in annual dividend payments.
    • CHK also says it will pay $450M as part of an agreement to exchange some acreage in Wyoming's Powder River Basin with private oil and gas producer RKI Exploration to consolidate its holdings in the southern portion of the basin.
    • CHK -0.7% premarket.


    • Caterpillar (NYSE:CAT) has entered into definitive agreements with Societe Generale to purchase a total of $2.5B of its common stock under accelerated stock repurchase transactions.
    • "Repurchasing an additional $2.5B of Caterpillar stock in the third quarter of 2014 will bring our total 2014 stock repurchases to $4.2B. says CEO Doug Oberhelman. 'This, combined with the 17% increase in our quarterly dividend announced in June, clearly shows how we are taking advantage of our strong cash position to deliver superior returns to stockholders."
    • Speaking on last night's earnings call (transcript), Raymond James analyst Collin Mings focuses in on the company's lowered expectations for housing starts, and questioned management on how it's thinking about 2015. CEO Rick Holley notes most expect a sizable jump in housing starts next year and says a tipping point for an acceleration in price improvement in Southern sawlogs is near.
    • Mings: "So I guess going back to the last call, where I think you were calling — for call it 10% move or so in U.S. sawlog prices this year. Is that now safe to say rough math right around 5% type price appreciation this year?" Holley: "That is correct."
    • Previously: Slowing housing market has Plum Creek easing guidance

    Tofu McNuggets to the rescue for McDonald's Japan

    • McDonald's Japan (NYSE:MCD) plans to introduce tofu nuggets as a new menu item with chicken supplies running short amid a sourcing crisis.
    • The company held a press conference earlier today to introduce the innovation and increase its damage control effort.
    • Previous: McDonald's Japan pulls guidance.

    The pancake trade-down is in play

    • The cheaper fare at Denny's (DENN +11%) and IHOP (NYSE:DIN) has kept the two restaurants chains moving in the right direction this year as other family dining and fine dining chains suffer traffic setbacks and margin crunches.
    • Analysts tie the steady performance of the two chains to low-income and middle-income families tightening their dine-out budgets.
    • IHOP has put in 5 straight quarters of positive same-store sales growth, while Denny's has posted a comp gain in 12 of the last 13 quarters in sector where negative to flat comp growth is the norm.
    • A number of restaurants stocks are pushing higher after activist investors get their way at Darden Restaurants (DRI +3.5%) and DineEquity (DIN +6.2%) puts in a solid quarter.
    • In the guessing game of which chain might get the most attention from restless institutional shareholders – Denny's (DENN +4.5%), Bob Evans (BOBE -0.2%), and Ignite Restaurants (IRG+3.5%) have been bantered around the most.

    BAML: Don't sleep on Kroger

    • Keep an eye on Kroger (KR +0.6%), advise the analysts at Bank of America Merrill Lynch.
    • The grocery store chain has a number of growth drivers – including organic food initiatives and its FuelRewards program – which justify a premium valuation in the retail sector.
    • Though investors give up some dividend income with a Kroger investment in comparison to Target or Wal-Mart, the revenue growth potential makes it a solid Buy to BAML.

    A few notes from Herbalife's Q2 CC

    • Herbalife (HLF -11.4%) CEO Michael Johnson spent a lot of time emphasizing the health benefits of the company's products, specifically the obesity-fighting benefits. He said that focusing on "wellness" and "fitness" will be the growth drivers going forward. It has invigorated the U.K. market, for example, by attracting a younger demographic into Nutrition Clubs.
    • Mr. Johnson is highly confident that the FTC investigation into Herbalife's business model will have a positive outcome. He stated that 97% of the product sold in the U.S. is consumed by the end user.
    • Over 13,000 people attended the company's recent Extravaganza in Chicago. Attendance was up 24% compared to 2013.
    • Average order in Mexico was down 60%, but increased volume of orders compensated.
    • Q3 guidance: non-GAAP EPS: $1.49 – 1.53.

    Heard during the Men's Wearhouse Analyst Day presentation

    • Men's Wearhouse (MW -9.5%) discloses at its Analyst Day presentation that it sees comp growth of 2% to 3% through 2017 and a gross margin improvement of 150 bps to 200 bps. Total sales should top $3.7B by 2017.
    • The timing of merger synergy realization is pushed back a bit by execs on some potential inventory issues.The tuxedo business will generate some nice savings as the JB business moves over to MW.
    • On the operational side, MW says it's learning from the profitable JB model.
    • FQ2 comp growth QTD: Men's Wearhouse +3.6%; Jos. A Bank +2.4%; Moores +8.3%.
    • Analyst Day webcast

    Smart pill firm raises substantial capital

    • In one of the largest financings this year, privately-held Proteus Digital Health raises $172M. The company is developing a "smart pill" that a patient swallows. It records data on the internal milieu and transmits it externally via a patch on the abdomen. Reactions with stomach juices provide the power.
    • One of Proteus' collaborators is Novartis (NVS +0.6%).
    • Investors include Novartis, Medtronic (MDT +0.2%), Oracle and Kaiser Permanente.

    Newspaper stocks on watch as print ad sales shrink

    • Newspaper stocks draw some notice after New York Times (NYT -5.5%) and McClatchy (MNI-2.4%) both report a drop in print advertising revenue for Q2 that exceeded expectations.
    • Though print advertising hasn't declined as fast as some skeptics forecast, a sobering statisticfor the sector is that adults in the U.S only spend 2% of their media time reading newspapers – although the category still pulls in 10% of all ad dollars.
    • On watch: Gannett (GCI +0.9%), Medua General (MEG), Lee Enterprises (LEE +1%), A.H. Belo (AHC +2.2%), Tribune Publishing (TPUB).

    It may take arbitration to get 1st-place Dodgers on the air

    • Time Warner Cable (TWC +1.4%) says it will agree to binding arbitration to settle its dispute with DirecTV (DTV +0.8%) over a carriage fee deal for the SportsNet LA network which includes coverage of Los Angeles Dodgers baseball.
    • DirecTV hasn't indicated yet it will agree to enter arbitration as it continues to push for an a la carte option for its customers. Meanwhile, close to 70% of the Los Angeles TV/broadband market can't access Dodgers baseball.
    • The TWC-DTV spat is being closely watched by the pay-TV industry (TCHTRCVCDISHVZ) and sports network owners (DISFOXATWXCMCSACBS) as the issue of bundling regional sports networks into packages remains a hot topic.

    Telcos swing wildly as Street mulls REIT odds, M&A potential

    • "I’m skeptical it can be replicated," says Elevation LLC's Stephen Sweeney about Windstream's (WIN +12.9%) REIT spinoff plans. "It’s very unclear if other large cap companies can have their companies viewed by the IRS as real estate."
    • UBS also has its doubts: It thinks AT&T (T +3.3%) and Verizon (VZ +1.8%) would have to open up their networks to rivals if they were spun off into REITs, something it doesn't think the carriers will be keen on doing.
    • Oppenheimer's Tim Horan is more positive, albeit while cautioning Windstream's spinoff isn't a done deal. "If successful with this restructuring, and there are obviously high regulatory barriers, this will be a game changer for the valuation of non-REIT infrastructure stocks in our industry.”
    • AT&T, Verizon, Windstream, Frontier (FTR +11.7%), and CenturyLink (CTL +4.2%) have pared their morning gains a bit amid volatile trading on very heavy volumes. AT&T has seen 66M shares trade vs. a daily average of 19.3M; Frontier has seen 89M trade vs. an average of 6.9M.
    • Enthusiasm about Windstream's spinoff stems not only from the tax benefits provided to REITs – American Tower's tax expense has been halved since it converted into a REIT in 2012 – but also from the potential for spinoffs to spark new M&A activity.
    • Windstream CFO Tony Thomas: "The REIT is going to be uniquely positioned to be in a great spot to help unlock value at other companies … We have a good understanding of how the REIT opportunity could work in the telecom landscape."
    • Earlier: Telcos soar following Windstream's REIT announcement

    Corning -3.2%; Gorilla Glass softness weighs on margins

    • Corning's (NYSE:GLW) Q2 gross margin was 41.6%, +60 bps Q/Q but -300 bps Y/Y and driving the quarter's EPS miss.
    • Contributing to the margin pressure: specialty materials (Gorilla Glass) sales, which tend to carry higher margins, were roughly flat Y/Y at $298M. Gorilla Glass sales missed expectations due to soft retail demand for smartphones/tablets and "lower-than-expected sales for planned new models." That could be a reference to Apple's sapphire production ramp ahead of the iPhone 6 launch.
    • On the other hand, LCD glass division sales (boosted by the Samsung deal) rose 62% Y/Y to $1.1B, with glass volumes growing by a low-teens % Q/Q (better than expected). Price declines were moderate, as expected.
    • Optical communications (fiber) sales were also better than expected, rising 14% to $601M. Environmental Technologies grew 25% to $285M thanks to demand for diesel emission control products, and life sciences rose 2% to $223M.
    • Q3 guidance: LCD glass volumes will rise by a mid-single digit % Q/Q, with price declines moderating further; optical will grow by a mid-single digit % Y/Y, environmental will grow 20%-25% Y/Y; specialty materials will grow 10% Q/Q; life sciences will be up slightly Y/Y.
    • With revenue up 25% Y/Y, SG&A spend rose 20% Y/Y to $318M, and R&D spend 16% to $208M. $200M was spent on buybacks. Corning has cut its full-year capex guidance by $200M to $1.3B.
    • Q2 resultsPR
    • Apple (AAPL -0.1%) has refreshed its MacBook Pro lineup to feature faster Intel Haswell CPUs, and more RAM in standard configurations. It has also cut the starting price of its most powerful 15" retina Pro model by $100 to $2499. (PR)
    • The $1299 and $1499 13" retina Pro models each now sport 2.6GHz. dual-core Core i5 CPUs, and the $1799 model has a 2.8GHz. variant. The $1999 and $2499 15" models respectively feature 2.2GHz. and 2.5GHz. quad-core Core i7 CPUs.
    • All 13" models now come with 8GB of RAM standard, and the 15" models come with 16GB. The next refresh will likely involve Intel's upcoming 14nm Broadwell CPUs.
    • Also: Apple has cut the starting price of its 13" non-retina MacBook Pro by $100 to $1099. That move follows the June launch of a cheaper iMac, and the April launch of cheaper MacBook Airs.
    • The launch of cheaper hardware had an impact in FQ3: Apple's Mac sales rose 13% Y/Y to $5.5B, and units 18% to 4.4M (better than expected). At the same time, ASP fell to $1,255 from FQ2's $1,334.

  158. Goldman after etrade, schwab, or anyone else

    This would be  a very bad sign if true as it would only be to eliminate competition but considering the climate for the big brokers a very unwise move so I rather doubt any truth to it.

  159. Trapped/Shadow – I guess that's because most people find a home they like to buy before they sell the one they have and not vs. vs.  

    TRLA/Wombat – Who can tell with all your secret codes?  So if you sold the $70 calls for $2.25 more than you bought the $80 calls for, you have a net $2.25 credit but, on anything over $2.25, you lose money to a cap of $7.75 at $80, right?  If you just sell the $70 calls for $10.80 you make $10.80 below $70 and some money up to $80.80 before you begin to lose money.  So why would I want a spread that pays 1/4 what the naked calls do and has to be $2.25 in the money before I get a penny?

    When you enter a trade like this, which is inherently risky, you should be making very small entries that you are comfortable doubling down and rolling and doubling down again.  I can't imagine you want to go 40, 40 and 120 on this position, so I think it's way too much on a risky issue you have very little control over.

    $325 on /NKD now!  No need to keep it overnight at this pace.  Dollar hasn't even dropped yet, still 81.31.  

    GS/Shadow – Really creeps me out to have them spying on our trades.  

  160. Citadel is as big as any HFT firm and has floated the buyout for years while basically destroying etrade's share price and it would be interesting to see how many options are on deck for them. 

  161. Phil  Goldman already is about the biggest spy firm not to even mention their HFT business through their dark pool. I ask why would they want or need to spy on little guys, the big bucks are front running the funds that buy the close every day.

  162. stjeanluc – Are you doing anything with QCOM?

  163. As expected, sell-off into the close.  Nothing to be bullish about until this pattern breaks. 

    S&P down almost 0.5%, that's new – especially with the RUT up 2.  

  164. Citadel

    They jammed IWM close @114.34 with just 14 shares, they are without doubt PSW's biggest and baddest enemy.

  165. Phil // Copiale
    z ns eh n hd iot hk tri j ns ah b mal tri nu h z ih plus c ni three bar d r. ki mu del oh s z uh three zs lip o.. pi iot oh r g zzz ni x. ns ah j iot del gam zzz y.. lam l iot hk p z eh plus f plus uu cross c. iot bas uu c del grr cross c. oh arr lam f h. nu x. uh : j sqp lam e m. ns r. gs m. c. : uu h tri sqi : lam gs grr y.. ru ah ds bar p. arr uh b m. oh c. : uu h tri sqi c. tri bar n z grr bar m. ah x. uu o m. grr iot c. n bar ns uh c x. ih hd zzz y.. plus zs del eh hd n. c. lam uu

  166. A shame having TZA as my hedge today, but thanks to a little SPX and some preventative AAPL selling  I ended very slightly in the green.  Had it been a year ago I would have been cat food.  AOK, then  -- thanks, gents.

  167. great call on TWTR- phil!

  168. BTW that jam screwed all the dark pool traders while the price went down after the close. How much did Goldman bonus them for that? Remember Citadel is a HFT dark pool criminal.

  169. Time to short Springfield Nuclear Power:

    Elon Musk seems to end up wildly successful in pretty much any venture that he's undertaking, and it appears that success extends into fictional worlds as well. According to EW, Musk will cameo on The Simpsons in a future episode, where he'll turn up in Springfield and somehow manage to bankrupt Mr. Burns.

  170. After watching 10 minutes the slim made over $.10 per share just on IWM.

  171. Those twtr 40 calls are flying. Thanks Stjeanluc and phil!

  172. STJ – I wonder what your little earnings position on TWTR will look like tomorrow.  I followed with a small fun amount.  Not worried.  This is one hell of a move though.  Very good for the Phil recommended position from a few months ago (Now a $23/40 2016 spread, offset with $30 Puts), but bad for this August calendar.  

  173. palotay // albo // XCO


    EXCO Resources misses by $0.01, beats on revenue

    EXCO Resources (NYSE:XCO): Q2 EPS of $0.03 misses by $0.01.

    Revenue of $182.9M (+21.7% Y/Y) beats by $5.02M.

  174. PNRA / Wow. Super quick recovery


    Panera Bread EPS in-line, misses on revenue

    Panera Bread (NASDAQ:PNRA): Q2 EPS of $1.74 in-line.

    Revenue of $631M (+7.1% Y/Y) misses by $9.78M.

  175. PNRA up a bit, BWLD disappointed but TWTR through the roof!  

    • Twitter (NYSE:TWTR) expects Q3 revenue of $330M-$340M, above a $323.7M consensus. Full-year revenue guidance is at $1.31B-$1.33B, above a $1.27B consensus. Full-year adjusted EBITDA guidance has been hiked to $210M-$230M from $180M-$205M.
    • Monthly active users (closely watched) +6% Q/Q and +24% Y/Y in Q2 to 271M, and generally better than expected. Mobile MAUs +7% Q/Q and +29% Y/Y to 211M. Timeline views +10% Q/Q and +15% Y/Y to 173B; Q/Q growth picked up from Q1's 6%.
    • Ad revenue (89% of total revenue) +129% Y/Y, up from Q1's 125% clip. Data licensing/other revenue +90% vs. +76% in Q1. Mobile was 81% of ad revenue vs. 80% in Q1 and 75% in Q4. Ad revenue per 1K Timeline views rose to $1.60 from $1.44 in Q1.
    • Though still far below U.S. monetization, international monetization (possibly boosted by the World Cup) improved in Q2: International revenue +168% Y/Y and now 33% of revenue, up from 28% in Q1 and 27% in Q4.
    • GAAP R&D spend totaled $177.1M, sales/marketing $140.3M, and G&A $44.7M. Total costs/expenses rose to $462.1M from $178.2M a year ago; Y/Y comps are skewed by $158.4M in stock compensation expenses (up from $22.6M a year ago).
    • The 7 analysts that have upgraded Twitter since early May can take a victory lap.
    • Q2 resultsPR
    • Buffalo Wild Wings (NASDAQ:BWLD) beats Q2 estimates on strong traffic numbers.
    • Same-store sales rose 7.7% at company-owned restaurants and 6.5% at franchised outlets. Both marks are a significant improvement over the comp growth seen in Q1.
    • The company saw its cost of sales fall compared to a year ago as chicken wing prices moderated and scale came into play.
    • Q3 same-store sales are tracking at +8% after four weeks.
    • BWLD -5.1% AH to give back some of the gains run up over the last 5 trading sessions.
    • Dreamworks Animation (NASDAQ:DWA): Q2 EPS of -$0.18 misses by $0.16.
    • Revenue of $122.3M (-42.7% Y/Y) misses by $15.8M.
    • Press Release

    AmEx cardmember spending up 9% in Q2

    • Net income of $1.529B or $1.43 per share vs. $1.405B and $1.27 one year ago. Net income includes a gain of $626M from closing of business travel JV. ROE of 28.8% 520 bps higher than a year ago.
    • Loss provisions of $489M down 6% Y/Y. Expenses of $5.9B up 2%.
    • U.S. Card Services net income of $770M up 4% Y/Y, with revenue of $4.5B up 6% – Card Member spending up 9%.
    • International Card Services net income of $77M down 63%, with revenue of $1.4B up 7%. Net income slipped at least in part due to a restructuring charge
    • Global Commercial Services net income of $561M up from $226M a year ago thanks to that JV gain.
    • Global Network & Merchant Services net income of $373M down 9%.
    • Conference call at 5 ET
    • Previously: American Express beats by $0.05, revenue in line
    • AXP -0.2% AH
    • United States Steel (NYSE:X): Q2 EPS of $0.17 beats by $0.44.
    • Revenue of $4.4B (-0.7% Y/Y) beats by $170M.
    • Shares +1.3%.
    • Press Release
    • AFLAC (NYSE:AFL): Q2 EPS of $1.66 beats by $0.07.
    • Revenue of $5.83B (-3.5% Y/Y) beats by $40M.
    • Press Release
    • Panera Bread (NASDAQ:PNRA): Q2 EPS of $1.74 in-line.
    • Revenue of $631M (+7.1% Y/Y) misses by $9.78M.
    • Press Release

  176. Phil // CVLT

    I love these guys and I think they're finally worth looking at again. Out of the pile of cloud storage facilities – these guys are the only independent left. Just got pushed under their 200SMA in 5 years.

  177. Wombat – I lightened up on the oil calendar in anticipation of a spike on these Russian sanctions. It seems like Putin may threaten to cut off oil to Europe which would spike the price and be a great opportunity to get more short. 

  178. Secrets/Wombat – You shouldn't be spouting off that kind of stuff if you're not a mason.  As you say, how many would agree without knowing beforehand what they would be bound to?

    TZA/ZZ – Woe unto us if they all start working!  

    Thanks Abhish. 

    Musk/StJ – Well that is cool, getting on the Simpsons.  

    You're welcome Abhish!  

    CVLT/Wombat – I don't see much of a catalyst to them.  Being the last independent might just mean they get crushed into dust.  Earnings call is tomorrow am, let's see what they have to say. 

    Oil/Palotay – Good idea, up they go to $101.10 now.  

  179. TWTR / Palotay – Most likely a small loss tomorrow. To think that you have to worry about a 20% move either way, pretty incredible. If it powers up tomorrow, you could cover the short call early and let the long one run. I did that with GMCR during last earnings and made some money that way.

  180. they would agree immediately.

  181. Computer/Phil – if you want something that is put together right and will just work:

  182. collection debt made the evening news saying average is about $5,000 debt, we owe 5 times that! I f you are doing well and feel like helping with $5 per week or whatever thank you. The updated information is coming soon, my hope is this week. Sorry this site will not allow proper order with the info first.

  183. Phil/TWTR

    As an example, would you share your thoughts about a straddle play on something like TWTR if we're expecting a big move but somewhat unclear direction on an equity prior to earnings (even though you seemed to know TWTR would do well…).   Obviously, knowing that TWTR moved 30% after-hours makes me think about this.  I know this isn't really our style here at PSW but wanted to know your thoughts and wonder if there was ever a situation where you would employ such a strategy, if so how might you set it up?

    With a delta of .5 with an at the money strike you should be able to generate a profit on one side of the trade, perhaps with stops on both so you stop out of the loser while you let the winner run. 

    Thanks in advance!

  184. Shadow/Fund

    Just donated, sorry it took me so long. Thanks for the reminder!

  185. palotay // CL
    Wise. I followed your lead. Just make sure you're not averaging down.
    17 days – should be interesting.

  186. Wombat / CL – I'm still in for 5 contracts, down from 20, with a plan to short another 5 if we get up to a $2.30 spread on the Sept/Nov calendar (Now $2.12).   

  187. Jeffdoc

    Thank you and to be clear for all the debt has nothing to do with getting to likely PA. They await my records but I am so far out that I have collected but don't follow through. Your recommended doc is who the info goes to, I did get his whatever but no need to waste his time when I am unable to go. The CT is going to be scanned with lots of information on the site, but the people doing it are very busy doing life.

  188. Scottmi:  I second your recommendation on Puget Systems, I've had mine for a few months, with my choice of SSD and backup drives, Ram, processor etc.  It works very well.  Moreover, they have over 100 vinyl appliques that, for a few bucks, they affix to the entire top / back of the screen.  I have Van Gogh's "Starry Night" on mine, a unique twist on the usual gray plastic of your average laptop -

  189. palotay / CL
    oh, interesting – I'm in Sept / Oct. If you have the margin, just sell the shorts when it spikes and buy the longs when it drops. It will increase your spread.

  190. Wow.  No reason to load up to the max on the Zillow deal, it would seem.

  191. America is broken and it is way beyond medicine. Every one of you are the possible answer. My generation deserves dignity and that is what we paid for. If you think that isn't happening wake up and smell the roses. No answers but questions for thought. What can or will you do? I am quit sure I will somehow survive but how lucky do you feel. I thought I was invincible, PSW sounded like an answer but it wasn't for those who fall into the bad luck group. Are you ready for consequences if misfortunate? Make a difference,that is not a donation to my problems, speak up, pass the word, and we can all do better helping all Americans. Vote the criminals out of office, let them know the supreme court isn't for the people anymore, corporations don't have hearts or brains, only money and the influence that buys. Spread the word!

  192. Good morning! 

    These are my notes for Money Talk tonight (7pm):

    I don’t have a screen shot but our Trade of the Year (as of 3/6 appearance) was:

    · 10 AAPL 2016 $450 puts sold for $41 (we've been selling that one all year), buying 10 2016 $450/600 bull call spread for $65 for net $24 ($24,000) which makes $126,000 profit at $600 (525%).  Should be up very nicely tomorrow!  

    AAPL had a 7 for 1 stock split in April and that changed this trade to 70 of the 2016 $64.29 short puts which are now $1.29 ($10,150) and 70 of the 64.29/85.71 bull call spreads, which are now net $16.40 ($114,800) for net $104,650 – up 336% and on track to make our full, planned 525% at $126,000.

    At this point though, I’d put a stop on the trade at $100,000 since we started by betting $24,000 and now we have over $100,000 on the table.  No one ever goes broke taking a profit! 

    It’s a bit late to play AAPL bullish as a new entry but we do like GTAT, who makes the Sapphire Glass that is very likely to be used to make future  IPhones.  The stock recently sold off on disappointment that the production run wasn’t large enough to match the launch of the IPhone 6 but patience is likely to be rewarded on this one, much like our LQMT trade idea last year, which went from 0.11 to 0.40.


    This is the kind of chart that sends most traders running but we see an opportunity as this is a manufacturing issue and not a product issue.  Just last night we had a miss from GLW (Corning) on lower demand for their Gorilla Glass, which competes with Sapphire. 

    We can set up a similar trade with GTAT to the one we had with AAPL by selling, for example, 20 of the 2016 $10 puts for $2.30 ($4,600) and buying 20 of the 2016 $10/17 bull call spreads at $2.70 ($5,400) for net $800 on a spread with an upside potential of $10,000 (up 1,150%) at $17 or higher.  On the downside, you risk being assigned 2,000 shares of GTAT at net $10.40 per share ($20,800), which is a 24% discount to the current price. 

    Overall, we are currently concerned there may be a market correction and one way to hedge that is with SQQQ, the ultra-short Nasdaq ETF, that is way down at $39.

    SQQQ will gain 3x on a Nasdaq drop so a 10% dip in the Nasdaq would send SQQQ up 30% to $50.  That means we can buy, for example, 20 Dec $40/50 bull call spread for $2.25 ($4,500), which has a $15,500 upside at $50 and we can offset that with the sale of puts on a stock we REALLY want to own if the Nasdaq doesn’t crash, like LULU, which is ridiculously cheap and also at $39.  With LULU, we can sell 10 2016 $35 puts for $4.90 ($4,900) and that gives us a net $400 credit on this insurance spread. 

  193. From Bloomberg, Jul 30, 2014, 6:18:43 AM

    July 30 (Bloomberg) — Ramin Nakisa, a global asset-allocation strategist at UBS Investment Bank, discusses European Union sanctions against Russia, today’s Federal Reserve monetary-policy decision and the outlook for European bonds.
    He speaks with Jonathan Ferro on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    U.S. equity index futures climbed as
    company earnings from Twitter Inc. (TWTR) to Amgen Inc. (AMGN) beat analyst
    estimates. Russian shares rose and the ruble strengthened as
    some investors judged U.S. and European Union sanctions milder
    than they anticipated. Aluminum rose.

    To read the entire article, go to

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  194. From Bloomberg, Jul 30, 2014, 5:51:52 AM

    July 29 (Bloomberg) — President Barack Obama speaks about the new sanctions against Russia. (Source: Bloomberg)

    Russia’s central bank said it’s ready to help any of the financial institutions targeted by the U.S. and Europe in the latest round of sanctions, as international investigators reportedly abandoned the latest attempt to visit the crash site of Malaysian Air Flight 17.

    To read the entire article, go to

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  195. From Bloomberg, Jul 30, 2014, 5:56:47 AM

    July 29 (Bloomberg) — James Grant, editor of Grant’s Interest Rate Observer, talks about Federal Reserve policy and its potential impact on financial markets.
    Grant, speaking with Tom Keene, Adam Johnson and Olivia Sterns on Bloomberg Television’s “Surveillance,” also discusses investing in Russia. (Source: Bloomberg)

    Bonds are rallying from the U.S. to
    Germany to Australia amid speculation the Federal Reserve will
    say today it needs to hold interest rates at a record low to
    support the world’s biggest economy.

    To read the entire article, go to

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

  196. From Bloomberg, Jul 30, 2014, 4:23:34 AM

    No one expects Janet Yellen’s Fed to act on interest rates when policy makers meet today. Photographer: Andrew Harrer/Bloomberg

    Federal Reserve Chair Janet Yellen
    still may beat Bank of England Governor Mark Carney to the punch

    To read the entire article, go to

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  197. From Bloomberg, Jul 29, 2014, 8:00:00 PM

    Harvey Miller, partner at Weil, Gotshal & Manges LLP and a bankruptcy lawyer for Lehman, said in an interview, “When Lehman went down, there was no stay in effect for derivatives and that had an enormous impact on the market. If you have an entity such as Lehman, which is interconnected with so many other contracts and global in scope, the markets will invariably fall.” Photographer: Peter Foley/Bloomberg

    Wall Street and global financial
    regulators, trying to squash the lingering perception that banks
    remain “too big to fail,” are looking to an obscure change in
    derivatives contracts to solve the problem.

    To read the entire article, go to

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  198. From Bloomberg, Jul 30, 2014, 5:04:12 AM

    Pedestrians walk past promotional material for Nokia Oyj’s Windows based Lumia smartphones on display at the company’s store in Helsinki. and Google Inc. Finland’s erstwhile largest company, Nokia, has sought to control debt growth by selling its mobile phone business to Microsoft. Photographer: Tomi Setala/Bloomberg

    Finns once employed in the country’s
    highest paying jobs are now joining the ranks of the unemployed
    and asking the state for financial aid.

    To read the entire article, go to

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

  199. From Bloomberg, Jul 30, 2014, 5:15:02 AM

    Airbus Group NV (AIR) said it’s closely
    monitoring the financial health of customers for the flagship
    A380 and acknowledged that not all superjumbos on order will get
    built after it pulled a purchase accord with a Japanese airline.

    To read the entire article, go to

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

  200. From Bloomberg, Jul 30, 2014, 4:50:12 AM

    A container ship stands beneath gantry cranes during loading and unloading operations at the dockside in the Port of Gothenburg in Gothenburg. Sluggish European demand and a strong krona have hampered exports and resulted in Scandinavia’s highest jobless rate. Photographer: Erik Abel/Bloomberg

    Sweden’s krona sank after a report
    showed the largest Nordic economy expanded less than forecast
    last quarter.

    To read the entire article, go to

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

  201. From Bloomberg, Jul 30, 2014, 5:25:59 AM

    July 28 (Bloomberg) — Andrew Wood, associate fellow of the Russia and Eurasia programme at Chatham House and former British Ambassador to Russia, discusses European Union sanctions against Russia, the outlook for President Vladimir Putin’s foreign policy and the governance of eastern Ukraine.
    He speaks with Mark Barton, Ryan Chilcote and Caroline Hyde on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    BP Plc, Siemens AG and Renault SA are among European companies preparing for a downward turn in their Russian business following the European Union’s decision to impose its widest-ranging sanctions yet over President Vladimir Putin’s involvement in eastern Ukraine.

    To read the entire article, go to

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

  202. From Bloomberg, Jul 30, 2014, 4:39:27 AM

    July 30 (Bloomberg) — Yevgeny Chichvarkin, founder of Russian handset retailer Euroset Holding NV and now based in London as founder of Hedonism Wines, talks about the effect of trade sanctions against Russia.
    He speaks with Caroline Hyde, Ryan Chilcote and Mark Barton on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

    Bond investors are signaling the deepest concern for Russia’s economy in at least two years as the U.S. and European Union toughen sanctions because of the crisis with Ukraine.

    To read the entire article, go to

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

  203. From Bloomberg, Jul 30, 2014, 5:23:10 AM

    July 29 (Bloomberg) — President Barack Obama speaks about new U.S. sanctions against Russia over its actions in Ukraine.
    Obama, speaking at the White House, said three Russian banks and a state-owned shipbuilder that serves Russia’s navy and oil and gas industry have been added to the sanctions list as the U.S. joins the European Union in escalating penalties. (Source: Bloomberg)

    Escalating European Union and U.S.
    sanctions jeopardize access to funding for Russian companies,
    threatening to cut them off from international capital markets
    that have provided at least $600 billion in debt and equity
    financing since the country emerged from its 1998 default.

    To read the entire article, go to

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  204. From Bloomberg, Jul 30, 2014, 12:01:14 AM

    A Tesla Motors Inc. Model S connected to a charger. Photographer: Emile Wamsteker/Bloomberg

    Tesla Motors Inc. (TSLA) will probably report record electric Model S deliveries in the second quarter after it accelerated output and began shipping its flagship sedan to China and the U.K.

    To read the entire article, go to

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

  205. From Bloomberg, Jul 30, 2014, 5:07:10 AM

    July 30 (Bloomberg) — Koji Endo, an auto analyst at Advanced Research Japan, talks about the country’s carmakers.
    Honda Motor Co., Japan’s third-largest carmaker, raised its profit forecast yesterday to the highest in seven years. Endo speaks with Angie Lau on Bloomberg Television’s “First Up.” (Source: Bloomberg)

    Toyota Motor Corp. (7203) hung onto a slim
    global sales lead over Volkswagen AG (VOW) in the year’s first six
    months as rising U.S. demand for SUVs paced a first-half record.

    To read the entire article, go to

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

  206. From Bloomberg, Jul 28, 2014, 12:12:35 PM

    Bayerische Motoren Werke AG (BMW), the
    world’s biggest maker of luxury vehicles, is offering drivers of
    the i3 city car speedier and smaller auto-battery chargers in an
    effort to make driving electric vehicles more practical.

    To read the entire article, go to

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

  207. From Bloomberg, Jul 30, 2014, 1:08:53 AM

    An estate agents in London. Photographer: Simon Dawson/Bloomberg

    Take a look at the world’s dizzying surges in the price of housing for 12 months at the end of June: London, up 20 percent. Manhattan, 18 percent. Sydney, 15.4 percent.

    To read the entire article, go to

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

  208. From Bloomberg, Jul 29, 2014, 6:01:01 PM

    Apartment blocks stand in the Borderouge district in Toulouse, France. Photographer: Balint Porneczi/Bloomberg

    French President Francois Hollande’s
    government may have made a housing slump worse, pushing the
    construction market to its lowest in more than 15 years.

    To read the entire article, go to

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

  209. From Bloomberg, Jul 30, 2014, 12:00:00 AM

    Janet Yellen, chair of the U.S. Federal Reserve. Photographer: Andrew Harrer/Bloomberg

    Here’s what to look for when the
    Federal Open Market Committee releases its policy statement at 2
    p.m. today in Washington. Federal Reserve officials won’t
    provide new economic projections, and Chair Janet Yellen isn’t
    scheduled to give a post-meeting press conference.

    To read the entire article, go to

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

  210. From Bloomberg, Jul 30, 2014, 6:12:28 AM

    Euro-area banks relaxed their
    lending standards for the first time since the second quarter of
    2007, in a further sign of a recovery in credit.

    To read the entire article, go to

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

  211. From Bloomberg, Jul 30, 2014, 12:00:01 AM

    Billionaire entrepreneur Elon Musk portrays himself in a future episode of “The Simpsons,” in which he battles the wealthy nuclear plant operator Montgomery Burns in 21st Century Fox Inc.’s long-running animated series, producer Al Jean said at Comic-Con in San Diego on July 26. Source: FOX via Getty Images

    Elon Musk, the billionaire
    entrepreneur who runs Tesla Motors Inc. (TSLA) and Space Exploration
    Technologies Corp., takes on the miserly power plant owner
    Montgomery Burns in a future episode of “The Simpsons.”

    To read the entire article, go to

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

  212. From Bloomberg, Jul 29, 2014, 10:53:25 AM

    The Golden Gate Bridge and the city of San Francisco are seen in the distance in this view from a home in Marin County, California. Photographer: David Paul Morris/Bloomberg

    Banks are handing out mortgages of as much as $10 million to the wealthy in record numbers while first-time homebuyers struggle to get loans.

    To read the entire article, go to

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

  213. From Bloomberg, Jul 29, 2014, 9:55:50 AM

    JPMorgan’s corporate and investment bank, run by Daniel Pinto, posted a 12 percent revenue drop to $17.6 billion in the first six months of 2014, while noninterest expenses declined by 1.6 percent to $11.7 billion. Photographer: Simon Dawson/Bloomberg

    JPMorgan Chase & Co. (JPM), the biggest U.S. lender, is cutting hundreds of technology support employees in its corporate and investment bank amid a revenue decline, people with knowledge of the move said.

    To read the entire article, go to

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  214. From Bloomberg, Jul 30, 2014, 5:00:00 AM

    Euro-area economic confidence
    unexpectedly increased in July, led by industry and
    construction, even as price growth remained anemic and
    geopolitical tensions threatened to undermine the currency
    bloc’s recovery.

    To read the entire article, go to

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

  215. From Bloomberg, Jul 30, 2014, 4:19:57 AM

    July 30 (Bloomberg) — Ramin Nakisa, a global asset-allocation strategist at UBS Investment Bank, discusses European Union sanctions against Russia, today’s Federal Reserve monetary-policy decision and the outlook for European bonds.
    He speaks with Jonathan Ferro on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    Spanish second-quarter growth beat
    the Bank of Spain’s estimate as economists say domestic demand
    supported a recovery in the euro region’s fourth-largest economy
    even as prices fell this month.

    To read the entire article, go to

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

  216. From Bloomberg, Jul 29, 2014, 11:48:27 PM

    July 30 (Bloomberg) — Kenji Abe, chief equity strategist at Citigroup Global Markets Japan Inc. in Tokyo, talks about the nation’s economy, stock market and the government’s policies.
    Japanese industrial output fell the most since the March 2011 earthquake, according to trade ministry data. Abe speaks with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    Japanese industrial output fell the most since the March 2011 earthquake, highlighting the widening impact to the economy of April’s sales-tax increase.

    To read the entire article, go to

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

  217. From Bloomberg, Jul 29, 2014, 7:01:00 PM

    July 25 (Bloomberg) — Rob Wood, an economist at Berenberg Bank, discusses the U.K. economy and Bank of England policy as gross domestic product expanded 0.8 percent between April and June, pushing output 0.2 percent above its previous peak in the first three months of 2008.
    He talks with Guy Johnson on Bloomberg Television’s “The Pulse.” (Source: Bloomberg)

    Britain’s opposition Labour Party
    will accuse David Cameron of presiding over the biggest drop in
    real wages since Victorian times as it sets out its economic

    To read the entire article, go to

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  218. From Bloomberg, Jul 30, 2014, 4:48:21 AM

    July 30 (Bloomberg) — Ramin Nakisa, a global asset-allocation strategist at UBS Investment Bank, discusses European Union sanctions against Russia, today’s Federal Reserve monetary-policy decision and the outlook for European bonds.
    He speaks with Jonathan Ferro on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

    Argentina said it will resume talks
    aimed at avoiding a default today after 12 hours of meetings at
    the office of a court-appointed mediator failed to produce a
    deal that would allow it to make interest payments.

    To read the entire article, go to

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

  219. From Bloomberg, Jul 29, 2014, 11:13:41 PM

    A vendor arranges fish for sale at a stall in the market district of Divisoria in Manila, the Philippines, on Monday, Jan. 6, 2014. Philippine consumer prices rose by 4.1% year-on-year in December, as inflation increased the fastest in two years. Photographer: Julian Abram Wainwright/Bloomberg

    Rhea Buan’s mother asked her family to skip meals after an almost 20 percent increase in rice prices in the past year made the staple food almost unaffordable.

    To read the entire article, go to

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

  220. HEY! That's my line!


  221. From Bloomberg, Jul 29, 2014, 1:00:47 PM

    He would block more nominations if they weren’t already blocked.

    The good news? Senator Ted Cruz of Texas has dropped his mostly-meaningless holds on State Department nominations.

    To read the entire article, go to

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  222. From Bloomberg, Jul 29, 2014, 12:21:14 PM

    Not a pharmacist.

    The worst thing about being on jury duty isn’t actually serving on a jury. It’s having to check in every day — possibly several times a day, depending on your local system — to see whether you’ll be needed. You can’t plan either your work or your personal life. Your schedule is unpredictable and completely out of your control.

    To read the entire article, go to

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  223. From Bloomberg, Jul 29, 2014, 12:04:11 PM

    It can work.

    Conventional wisdom states that renewable energy cannot cover 100 percent of the world’s needs: It’s too expensive and too scarce, and switching would be inefficient while hydrocarbon resources are still plentiful. A group of 28 U.S. scientists and engineers has attempted to make the opposite case.

    To read the entire article, go to

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  224. TWTR/Jeff – I am not a fan of straddles, or any form of betting against myself.  I prefer to pick a direction and go with it and, with crazy-assed stocks like TWTR that do move 20% on earnings – I prefer not to play at all because it sucks up time and money that can better be spent SENSIBLY making returns on stocks that we CAN make rational calls on.  Sometimes, we see stocks that have ridiculously high or low option prices vs the expected move and we make a play based on that (usually a ratio backspread) but still I tend to do them when I have a notion which way things will go, like the BIDU trade yesterday.  

    TWTR hit $52 yesterday and looks about $47 now, up from $38 yesterday.  They had fantastic growth numbers but how do you quantify whether that means they should be at 300x or 400x or 500x their projected .10 earnings?  The made 0.02 this Q and people are going nuts because a 0.01 loss was expected, so up 300% over estimates.  As I said yesterday, it's very easy to move a receivable here and a payable there to move a penny around on a balance sheet and that's exactly what they did.  

    We have TWTR in the Income Portfolio – 5 2016 $23/40 bull call spreads at $8.35 ($4,175) with 10 short $30 puts at $6.20 ($6,200) for a net $2,025 credit on the $8,500 spread that's well on track now for the whole $10,525 gain.  As of our review on 7/16, the position was only slightly ahead and it's been in our portfolio since 4/30 and on 5/8 we doubled down on the puts from the original 5 as TWTR sank and I stuck to my guns.  

    Why is it, when we can consistently make nice, CONSERVATIVE trades like this one that make 600% in 18 months (and it's probably up over 300% today), that people still insist on trying to find ways to take ridiculous risks?  


  225. Big Chart – That 50 dma MUST HOLD on the Dow at 16,866, NYSE back below 11,000 and RUT has to retake 1,143 or 1,100 starts to look possible.  Meanwhile, we have GDP and the Fed today – so who knows?  

    Z/ZZ, Wombat – I don't see the combined entity as a winner, that's for sure.  I like those reports! 

  226. Phil// Is SQQQ/LuluGTAT are now official trades or just trade ideas/suggestions?  Thanks.

  227. Phil / SQQQ / LULU
    Thanks – nice combo.
    Missed the Bull Call Spread on PNRA ( didn't fill ) – but I have doubled up on the short puts.
    Would you grab a spread now or wait until it settles down ?

  228. Bueller ?