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Technical Tuesday – Trouble at 2,728, Again!

The market is so predictable.  

There's a ton of money to be made from predictable, so we're certainly not complaining.  After a meaningless spike higher, the S&P calmed right down and finished right at our 2,782 line (2,730, actually) and this morning, as expected, the index is pulling back as the Dollar rises back to the top of it's range.  Eventually, one of these will break out and the other will fall – but which one will prevail?

We had a good run on /ES, all the way from 2,600 (barely touched two weeks ago) back to 2,728 and a 28-point run means we're looking for a 5.6-point retrace back to 2,723 (weak) and 2,717 (strong) and, even as I write this (7:30), the Futures bounced off 2,723, failed 2,728 again and are now testing 2,723 again but I think they'll fail as the Dollar is at 92.87 and rising and that's up half a point so we'll look for 2,717 and see how that's doing.  The Futures on the S&P (/ES) pay $50 per point so it's a quick $300 if that bet plays out and, of course, simply stop out over 2,723 to limit the risk.

The Dow is also having fun around it's own 20% line but, in this case, it's been unable to get over the line (25,200).  26,250 is the 25% line and that's 1,050 away but we'll call it 1,000 so we can call the bounce lines 200 points and that makes our up and down range from 25,200: 24,800, 25,000, 25,400 and 25,600 so we can chart that like this:

The Dow strayed down to the 200 dma at 23,750 so the run to 24,950 yesterday was 1,200 points and we'll call those rejection lines 250 points to 24,700 (weak) and 24,450 (strong) but that would take us back below the 20% line and that would be a big negative so very bad if 24,700 does not hold.  

Exxon (XOM) and Chevron (CVX) have been boosting the Dow as oil and gasoline test new highs but what's great for them is not so good for the industrials that use oil and gas to produce goods but, fortunately, there are not too many Industrial companies left in the Dow Jones Industrial Average. 3M (MMM), Boeing (BA), Caterpillar (CAT), Dow (DD) and GE (GE) are the only manufacturers who might care about oil and 3M not so much, really and CAT benefits as higher oil means more digging for it and BA benefits as it creates demand for their newer, fuel-efficient planes.  Apple (AAPL), Cisco (CSCO), Coke (KO), Intel (INTC) and Nike (NKE) are not really oil-dependent and that's it for all of the Dow you could even call manufacturers these days.  

On the Nasdaq, we're playing around the 30% line at 7,020 and the 25% line is 6,750 and 6,480 is the 20% line but let's call it 6,500, 6,750 and 7,000 and that makes for 100-point bands on the move from 6,500 to 7,000 but what we care about here is just the retraces off 7,000 at 6,900 and 6,800 – those have to hold up for us to keep our 7,000 caps on!  

Keep in mind, on the Nadaq, that's the 30% line and, even though we are giving the markets 10% due to the tax cuts, it's still at the top of it's 20% range from there so pretty overbought and we've seen the Nasdaq fall 500 points from here twice this year and, at $20 per point on the /NQ futures, that's a whopping $10,000 per contract of potential gains on the short side!  As I said to our Members yesterday morning in our Live Chat Room:

Big Chart looks all clear and the Futures are up so not much to do but watch and wait today.  7,000 is the 30% line on the Nasdaq and if that isn't resistance, then we're probably breaking up to retest the highs.  Dow 25,000 also very significant, of course. 

Both caught harsh rejections yesterday and now we wait and see just how low we can go on our indexes.  The Russell (/RTX) is our toppiest index, over the 10% line at 1,584 and testing 1,600 but here we'll run the numbers line to line from the 5% at 1,512 so 72 points means 14-point bounce lines around 1,584 would be 1,556, 1,570, 1,598 and 1,612 and that looks like this:

I'd say the 1,600 line and the 2,728 lines are make or break for the day and both look like they are breaking now (8:30) as the Dollar spikes over 93, wich is almost 1% higher than it was yesterday so no surprise the markets would reprice themselves at least 0.5% lower as it's that kind of relationship.  And lets not forget the Big Daddy Index, the one that rules them all – the NYSE, which has almost all of the components of the Dow and the S&P in it's 2,800 company portfolio.

In the case of the NYSE, it's right at it's Must Hold line (12,800) and, since we've said we're giving the indexes 10% in recognition of the tax cuts boosting earnings – that's NOT GOOD, since it's 10% below the 10% line (math!).  In this case, we'll look at the -5% line at 12,160 so it's a 640-point move and that makes for 125-point bounce lines @ 12,550, 12,675, 12,925 and 13,050 which would look like this:

If the NYSE is below 12,800, then bearish bets make the most sense and, when it's over, we can get a bit more hopefully bullish but the trend is not our friend the longer 12,800 acts as overhead resistance.  When the NYSE is lagging, it indicates the other indexes are not broadly rallying, which means those rallies can be very, very fragile.  Of course, if the Dollar keeps going up (global tensions), then commodities might collapse and that's been the NYSE and the S&Ps best sectors so – oops!  

Understanding these relationships and understanding the channels the indexes (and stocks) tend to move in is the key to making short-term money in the market.  Generally, we're long-term, Fundamental Investors and we don't really care about this nonsense but, while we are waiting for our long bets to pay off – we like to have fun betting against the suckers who think the market is about to make a new high – or a new low.  Usually, it doesn't so we place our bets on those lines with tight stops if they break and that keeps our risk low while our rewards can be very, very high.  See – easy!  


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  1. Good morning,

    coffee not having a good morning thus far =/

  2. The only goal is to enrich themselves and their friends:

    Secretary of Education Betsy DeVos might have assigned the foxes to guard the henhouse when she hired multiple former employees of for-profit colleges to the Department of Education. During her time in office, probes into for-profit colleges have been derailed and marginalized, according to a report from the New York Times.

    What's so frustrating is that the victims of these for-profit colleges or even the money lenders that we left of the hook are people who form the Trump base! He is stealing from them to give to his friends and they love it….

  3. Keep the hedge fund small….,-smaller-is-better

    “Small funds outperform large funds and are more likely to maintain good performance,” Gao, Haight, and Yin wrote. “In addition, the contribution of the management fee to managers’ total compensation grows with fund size, suggesting decreasing incentives to improve performance.”

  4. Good Morning.

  5. ~~VRX  – Upgraded to Buy from Neutral at Mizuho.

    Gold is getting crushed.

  6. ~~Gold tumbles below 200-day MA as 10-year Treasury yield pierces 3%.

    •Gold prices plunge to YTD lows following economic reports on retail sales and manufacturing, adding to pressure from climbing rates in the benchmark 10-year Treasury.

  7. Any comments on XRX?

  8. Good morning and wheeee!  

    That CASH!!! call is looking good with CASH!!! up 1% today….  cheeky

    That's putting pressure on commodities, of course (see early morning comments) so it's really a buying opportunity as the Dollar will stop eventually and it's usually a pretty short-term effect (days at most).  

    /SI is my favorite as we close in on $16.20 as an 0.60 pop from there is $3,000 per contract.  Understand though, it's my favorite as I'd be happy to DD at $16, when it's down $2,000 per contract! 

    As I said earlier, we don't want to jump in until we see a floor in /YG and /SI better safe than sorry. 

    Oil with a big sell-off but also thanks to Dollar:

    Honey badger does not care:

    And OMG! 

    That's a DISASTER!  

    So a person who bought a 10-year note mid 2016 is down more than 10% on redemption – so far.  Figure those notes are sub-2% so, if inflation hits 3% then they are either losing 1% a year or they cash in and take the loss now and get a better note.  If they start cashing in, they compete with the Government selling notes and flood the market – further reducing the value and pushing up rates for new notes, which then puts more selling pressure on old notes (this is why the inverted yield curve is BAD).

    Speaking of inverting – the 30s have a lot of catching up to do:

  9. AMGN reporting tomorrow short armchair: sell the Jun 22 170/175 strangle for 7.24 and buy the stock combined div 3.48 % in 38 days.

  10. /KC/Dave – Just the Dollar pushing everything lower.  

    Small/StJ – I would hate running a large hedge fund (Billions).  Our goal at Capital Ideas is to get to about $1Bn tops, long-term but we're still working on getting to $10M, then $100M so not something I have to worry about this year!  I don't consider $100M big though, $10M funds can barely pay their bills – even if you make 20% that's $2M so fees are $400,000 + 2% is $200,000 – sad!  Run that up to $100M though and we're collecting $4M in fees (our 20%) and $2M as our 2% and NOW we have a business!

    Anyone who wants to invest in our Hedge Fund while it's still the ideal size – please contact Greg (at philstockworld dot com) and, don't forget, only 45 days left to participate in PSW Investments (which owns the fund).  

      Of course, I understand what they are saying here:

    “In other words, when funds grow large, fund managers may have less incentive to improve fund performance because most of their compensation comes from the asset-based management fee,” 

    That's true as, if we become a $1Bn fund, then if we pull in 20% gains ($200M) our success fees would be $40M and the 2% fee would $20M so $60M for the management company would be as much as we could make if we invested $300M which means we now make more in fees than we do from our own investments.  I can see where some people would coast on that and start to concentrate on not losing customers – since that's where the money is coming from at that point.  

    VRX/Albo – I think we timed that well (after watching it for a year!):

    Long Call 2020 17-JAN 15.00 CALL [VRX @ $21.39 $0.58] 20 3/2/2018 (612) $9,000 $4.50 $4.63 n/a     $9.13 $0.40 $9,250 102.8% $18,250
    Short Call 2020 17-JAN 22.00 CALL [VRX @ $21.39 $0.58] -20 3/2/2018 (612) $-5,200 $2.60 $2.93     $5.53 $0.43 $-5,850 -112.5% $-11,050
    Short Put 2020 17-JAN 15.00 PUT [VRX @ $21.39 $0.58] -20 3/2/2018 (612) $-8,000 $4.00 $-2.13     $1.88 $-0.02 $4,250 53.1% $-3,75

    XRX/Yodi – RIP! 

    AMGN/Yodi – Good one, I strongly agree. 

    AMGN should be good for $14/share so $173.70 is a good deal (p/e 12).  They appear to earn less because they repatriated last year and took a big tax hit but the cash is in the bank ($40Bn).

    Year End 31st Dec 2012 2013 2014 2015 2016 2017 TTM 2018E 2019E CAGR / Avg
    Revenue $m 17,265 18,676 20,063 21,662 22,991 22,849 22,939 22,696 22,609 +5.8%
    Operating Profit $m 5,577 5,867 6,191 8,470 9,794 9,973 10,108     +12.3%
    Net Profit $m 4,345 5,081 5,158 6,939 7,722 1,979 2,219 9,384 9,413 -14.6%
    EPS Reported $ 5.61 6.64 6.70 9.06 10.2 11.0 11.6     +14.4%
    EPS Normalised $ 5.87 7.02 7.15 9.13 10.2 11.4 11.6 13.7 14.1 +14.2%
    EPS Growth % +19.8 +19.5 +1.9 +27.7 +12.1 +11.5 +9.9 +19.8 +3.47  
    PE Ratio x           15.4 15.2 12.9 12.4  
    PEG x           0.78 0.77 3.71 3.06

    So those $9Bn estimates are realistic expectations for this $115Bn company and that's a real bargain in Biotech land.  We'll see how earnings go but let's set up a small position for the LTP – just in case it pops and we miss it:

    • Sell 5 AMGN 2020 $160 puts for $15.50 ($7,750) 
    • Buy 15 AMGN 2020 $175 calls for $20 ($30,000) 
    • Sell 15 AMGN 2020 $200 calls for $11 ($16,500) 

    That's net $5,750 on the $37,500 spread so $31,750 profit potential at $200 and we're aggressively high as they might miss and then we'll spend about $7,500 more to roll the calls down $10 and widen the spread by $15,000.  Either way, we'll be able to sell 5 short calls and, at the moment, the July $180s are $3 so $1,500 for 66 out of 612 days means we can collect about $12,000 in premiums while we wait.  Not selling short calls yet as I think they are priced too low into earnings.  

  11. gross

    $36M though, good work if you can get it

  12. Phil,  

    I know we are a long way from here…That's true as, if we become a $1Bn fund, 

    However, we should think about how much capacity can we actually have for the hedge fund. 

    At some point, trading costs will dominate as options markets are less liquid than stock markets.

    In addition, the liquidity is episodic (earnings etc.) and not uniform. 

    At some point we should think about the maximum position we want to hold for a given option? 1 day average volume, 5 days average volume?… 1 day average volume will take 10 days to unwind if we trade 10% of the daily volume.  Just some thoughts.. 

  13. Hedge Fund / Phil – Of course, all these fees issues would not be a problem if they were linked 100% to performance! Then you would not have managers coasting on previous results…

  14. EXTR up sharply.  Thinking it may have bottomed.

  15. Phil – Russell up while all others are down? 

  16. Hedge Fund/Learner – Believe me, I've been thinking about it for years!  Keep in mind that, as a large fund, we'll look to take larger positions in big companies like:

    • Sell 500 AAPL 2020 $160 puts for $10 ($500,000) 
    • Buy 2,000 AAPL 2020 $170 calls for $32.80 ($6,560,000) 
    • Sell 2,000 AAPL 2020 $200 calls for $18 ($3,600,000) 
    • Sell 500 AAPL July $190 calls for $4.30 ($215,000) 

    In no case are we taking more than 25% of the the open contracts and this net $2,245,000 spread returns $6M for a $3,755,000 profit plus another $1.25M selling short calls would be $5M (200%) back on that one trade and we only need to make $200M a year (40 trades like that) to make $1Bn worth of investors very happy.  

    As I said, that's the max I see but Buffett does it with $100Bn (averaging 16% with no options) so I'm pretty sure we can figure it out with "just" $1Bn!  cool  Meanwhile, we're SO far away from those concerns (years) that it's not worth worrying about at the moment – that one trade would be a great 2-year return on a $10M fund…

    Performance/StJ – I think the good managers are not the type to sit back.  They want to score and produce big for their clients.  You need $500K just to run the fund so, out of $10M, $200,000 doesn't even pay the rent.  Once you are around $50M, then $1M in fees covers the fund – even with more traders but it's not like it's raining cash – performance is still the big carrot up to about $100M, then, at $2M/yr in fees, people may want to just protect their phony-baloney jobs but again – those aren't the kind of people that successfully drive a fund to $100M in the first place.  

    Russell – Strong Dollar is good for small caps who do 80% of their business in the US.  

    Wow, /RB shot right back up  to $2.22!  

    Gotta go for /YG here ($1,292).  I already have 2 /SI that are up $500. 

  17. Phil – carbon on the blockchain

    You will like this guy! It looks like they are making a token (called Poseiden) on the Stellar platform and fundraising via donations (backdoor ICO maybe??) . Legal entity of Malta…..

    Looking for CA taxes around carbon credits I found this. Note that the The California Air Resources Board acronym is the same as Carbon Coin's ticker (CARB)… It's like they want to be together… 8)

  18. TSLA I wonder if the 200 put sale is still safe?????

  19. I like that BDC, that's on the right track, I think.

    /RTY is a great short just under the 1,600 line with tight stops above but 2,700 on /ES should be bouncy – so watch out for that.  Lined up with 24,650 on /YM and 6,870 on /NQ

  20. Eurozone GDP growth slows in first quarter

    • Eurozone economy slowed slightly to an annualized 2.5% in the first quarter, compared to the consensus of 2.7%, following 2.7% annual growth in the fourth quarter.
    • Speaking after the bank’s latest policy meeting in April, ECB President Mario Draghi acknowledged that the pace of the euro area recovery had moderated since the start of the year, but signaled no change in monetary policy.
    • Draghi said his overall assessment was one of “caution tempered by an unchanged confidence” that inflation is moving towards the ECB’s target of just below 2%.
    • German economic sentiment held at -8.2 in May compared to the consensus of the index to improve slightly to -8.0 points underlining concern over the health of the euro zone's largest economy.
    • The Current Conditions Index dropped to 87.4 from 87.9 in April compared to the consensus of 86.2.
    • The German economy grew by 0.3% in the first three months, the slowest rate since the third quarter of 2016.

    • Taking to Twitter as the 10-year Treasury yield spikes up to a new multi-year high of 3.06% (and the 30-year hits 3.20%), Bill Gross says the economy can't support 10- and 30-year yields at higher than 3.25%, nor the 5-year above 3% (it's up to 2.90% today).
    • He expects the 30-year yield will have a hard time busting through the three-decade downtrend line at 3.22%.
    • Previously: Higher rates halt stock rally, for now (May 15)
    • The World Trade Organization rules that European government subsidies are harmful to Boeing (BA -0.7%) because they illegally assisted Airbus's (OTCPK:EADSFOTCPK:EADSY) development of A380 and A350 jets.
    • Following the ruling of the nearly 14-year-long case, the U.S. says it will seek authority to impose billions of dollars in punitive tariffs against goods from the European Union unless it stops “harming U.S. interests.”
    • “Today’s final ruling sends a clear message: disregard for the rules and illegal subsidies are not tolerated,” says Boeing CEO Dennis Muilenburg.
    • Though a negotiated settlement over the Airbus subsidies remains possible, the ruling raises the risk of an open trade war.

    TSLA/Yodi – I never sold puts on them as I never felt even $150 would be "safe" and, if it were assigned to me at $150 – I sure as Hell don't want it for the long-term!  

    TSLA Executive Departures this year (so far):

    May – Matthew Schwall, director of field performance engineering, exits to join Alphabet Inc's self-driving unit, Waymo.

    April – Georg Ell, director of Tesla's Western Europe operations, leaves to head UK-based Smoothwall.

    March – Chief Accounting Officer Eric Branderiz exits after joining in October 2016.

    March – Susan Repo, corporate treasurer and vice president of finance, exits to become chief financial officer at another company.

    February – Jon McNeill, president of global sales and services, leaves to join ride-hailing company Lyft as chief operating officer.

    January – Jason Mendez, director of manufacturing engineering, leaves after more than 12 years.

    January – Will McColl, manager of equipment engineering, leaves after seven years.

    Each of these guys, if they had ANY faith in the company, are walking away from Millions in vesting.

    And it looks like they lost their #1 cheerleader:

    Tesla stock falls after Morgan Stanley cuts price target, says Model 3 production issues could signal long-term margin woes

    Tesla: Questions About Model 3 Profitability as Production Rises

  21. OMER – my lingering small position finally kicked up again in a big way last few days. Covered with June $25 calls.  crazy move last few days following earnings of a miss and loss. must be trying the TSLA and AMZN strategy.

  22. Phil// Any recommended trade on CHK?  Thanks

  23. Phil/RB- would you suggest another short entry at this level?

  24. OMER/Scott – Wow, hopefully they lose more money and miss estimates for you next time!  blush

    CHK/Rookie – Well, they are finally perking up a bit.  I still like our LTP play but it's in the money now:

    Short Call 2020 17-JAN 5.00 CALL [CHK @ $3.63 $0.03] -50 1/8/2018 (612) $-4,750 $0.95 $-0.26 n/a     $0.69 $0.04 $1,300 27.4% $-3,450
    Short Put 2020 17-JAN 4.00 PUT [CHK @ $3.63 $0.03] -50 1/8/2018 (612) $-6,000 $1.20 $-0.08     $1.13 $-0.06 $375 6.3% $-5,625
    Long Call 2020 17-JAN 2.00 CALL [CHK @ $3.63 $0.03] 50 2/9/2018 (612) $7,000 $1.40 $0.58     $1.98 $-0.03 $2,875 41.1% $9,875

    In the OOP, we have the $3 calls instead and that one's more like even (we spent 0.40 to roll the $3s to the $2s in the LTP, so really they are both about even).  

    CHK/Albo – They certainly haven't done much to help themselves lately but they did make 0.82/share last year and should make 0.75 this year, which is just 1/4 of the $3 stock price.  I like them as a LONG-TERM play on /NG, not for anything special I expect from them Q/Q.  

    Still good for a new trade in the LTP:

    It's good that we were conservative on them and also good we chose to ride out the dip.

    /RB/Rookie, Ravi – You have API tonight, which has been nothing but friendly to /RB the past few reports so "recommend" is totally out and "suggest" is probably too strong too.  Call it "don't hate but wouldn't play it" – that's about right.

  25. §  scottmi 

    §  OMER   ME TOO

    §  I covered with nov 24 

  26. Wow, /RB did come down, tested $2.20!  

    /CL at $71.18 off $71.92 high and $70.50 low.  

    Indexes not looking very strong but /ES right at 2,700 and /RTX just below 1,600 and now /YM at 24,600 and /NQ 6,850 so of course there's support – watch out if things break down here though.

  27. CSCO/Phil- any thoughts on Cisco?

  28. Phil

    Any trade on M earning before open tomorrow


  29. Looks to me like we're consolidating for a move lower.

    CSCO/Dave – LOL, I remember the days when I would bang the table on CSCO in the low teens.  Now $45 is a $200Bn market cap on $10Bn in earnings so fully priced for a rational market.  I wouldn't short them because I like them long-term but they'd have to be back around $40 before I felt compelled to jump in. 

    M/QC – There were super-cheap (below $20) when we bought them last year so $30 is not that exciting to me – though still probably worth it.  $9.1Bn and over $1Bn in profits is a good place to put money but, ahead of earnings – I hope they miss and go on sale – that's all.

    • Macy's (M +1.4%) trades higher in front of tomorrow's Q1 earnings report.
    • Analysts expect the retailer to disclose revenue of $5.43B and EPS of $0.37. Comparable sales growth on owned basis is forecast to be +0.3% during the quarter, while comparable sales on owned plus licensed basis is seen rising +1.0%.
    • Full-year guidance from management will be a crucial test to see if new initiatives are starting to pay off. Consensus estimates are for Macy's to guide for revenue of $24.79B and EPS of $3.59.
    • Sources: Bloomberg,
    • Gold futures fell to their lowest settlement of the year, with June Comex gold -2.1% or $27.90/oz. to $1,290.30/oz. as today's spike in U.S. Treasury yields chase investors away from the yellow metal.
    • Downward momentum in gold picked up after breaking below support at its 200-day moving average at $1,306/oz.
    • The drop below $1,300 "set off a large number of pre-placed sell stop orders in the futures market, to drive prices still lower. The U.S. dollar index has resumed its trek north today, which is, and has been, a significantly bearish force working against the precious metals bulls," says Kitco Metals analyst Jim Wyckoff.
    • July silver settled -2.2% at $16.28/oz.
    • JPMorgan says Amazon (AMZN -1.7%) is on track to match Walmart (WMT +0.5%) in domestic sales by 2020 or 2021.
    • Analyst Christopher Horvers cites Amazon’s key drivers, which include “the Prime ecosystem; endless aisle driven by third-party seller expansion; outsized growth in large, unpenetrated categories, and removing friction and moving closer to customers
    • The analyst notes that Amazon is growing at a faster pace than Walmart in the United States. Last year, Walmart reported $495.8B in annual revenue and U.S. sales of $318.5B (+3.5% Y/Y). Amazon reported $186B U.S. gross merchandise volume last year (+31% Y/Y). 
    • Previously: Seattle scales back tax on Amazon (May 15)
    • Previously: Winners and losers from the retail sales report (May 15)
    • Previously: Amazon moves into blockchain (May 15)
    • IMAX (IMAX +1.1%) CEO Richard Gelfond tells Bloomberg that the company plans to open 15 to 20 theaters in Saudi Arabia over the next three years.
    • Gelfond calls the region a "rare" new expansion opportunity for IMAX due to the underpenetrated nature of the exhibitor industry.
    • The IMAX team is meeting with government official and local partners in Saudi Arabia this week.

  30. Bounce Back Wednesday ? Blow Back Thursday

  31. Still looks like we're consolidating for a move down but violent changes are just a tweet away.

  32. Rb/Phil- safe to poke short at 2.2?

  33. /RB/Dave – "Safe?"  See above.

    On the whole, not much of a pullback.  Volume was low (so far) but more than yesterday. 

    Date Open High Low Close* Adj Close** Volume
    May 15, 2018 271.590 271.610 270.030 270.660 270.660 67,109,171
    May 14, 2018 273.340 274.080 272.360 272.980 272.980 53,983,100
    May 11, 2018 272.160 273.150 271.580 272.850 272.850 59,871,500
    May 10, 2018 270.340 272.390 270.220 272.020 272.020 72,063,900
    May 09, 2018 267.680 269.870 267.090 269.500 269.500 59,666,100
    May 08, 2018 266.500 267.330 265.150 266.920 266.920 67,499,200
    May 07, 2018 266.890 268.020 266.110 266.920 266.920 55,304,900
    May 04, 2018 261.520 266.790 261.150 266.020 266.020 91,222,100
    May 03, 2018 262.260 263.360 259.050 262.620 262.620 136,311,500
    May 02, 2018 264.760 265.680 262.760 263.200 263.200 86,368,900
    May 01, 2018 263.870 265.100 262.110 264.980 264.980 74,203,400

  34. If TEVA is good enough for Warren Buffett, it's good enough for me… I was looking to add to my position to lower my B/E price. Can't pick the bottoms, but this will do for now I think.

  35. Phil// Question on HMNY – From the cash reserves it looks like they can run the business for couple of months unless they further dilute the number of shares or go for a line of credit.  Knowing all of this information how comfortable are you with HMNY?  Will you DD if needed or what is the long term plan on this stock?  Thanks.

  36. CHK GE and now TEVA.

    I'm in the 1st. 2nd and 3rd teed up but I'm patient.

  37. Good morning!  

    Dollar spiking up again, which is a shame as gold hit $1,294.50 and silver $16.35 for nice gains that quickly evaporated after 4am and I slept through it so riding them both out with 2 longs each, pretty much back where we started ($16.25 and $1,292).  /KC popped to $1.20, which isn't much but improving and I have 4 longs there at $1.21 avg.

    All the indexes are flatlining this morning, so far but the VIX is high so I still think down once we open.  /RTX 1,602.50 is the lagging short so tight stops above and easy to play.

    Watch DAX 13,000 – bad sign if that fails:

    Trump is really going all out to wipe out Obama's entire legacy:
    • Explosions are intensifying on Hawaii's Kilauea volcano, spewing ash and triggering a red alert for aircraft for the first time since the latest eruption began 12 days ago.
    • The tourism industry is taking a downturn as a result. Big Island summer hotel bookings dropping by almost half from last year, according to the Island of Hawaii Visitor Bureau.

    In other disasters:

    • Mexico sees diminishing chances for a new NAFTA deal ahead of tomorrow's deadline – given by U.S. House Speaker Paul Ryan – that would allow for the pact to be approved before a newly elected Congress takes over in January.
    • Further complicating talks are Mexico's presidential election, which is less than seven weeks away, as well as impending steel and aluminum tariffs, scheduled to hit Mexico and Canada on June 1.

    Trump’s Goal for Nafta Rewrite Looks Unattainable in 2018.

    • China sold $2.5B of Treasuries in March amid heightened tension between Beijing and Washington over trade.
    • The largest foreign holder of U..S Treasuries joined other countries in selling long-term U.S. government debt with a maturity over one year, having been a net buyer in January and February.
    • Despite the selling activity, China's overall holdings increased by $9B to $1.19T due to changes in Treasury prices.

    Bonds & Bullion Bloodbath As Dow Dumps Into Red For 2018.

    • North Korea is expanding on its threat to cancel the June 12 summit between Kim Jong-un and President Trump.
    • Besides protesting the joint air force drills taking place in South Korea, Pyongyang said the U.S. must stop insisting it "unilaterally" abandon its nuclear program and lashed out at national security advisor John Bolton, who talked about a disarmament similar to "Libya 2004."
    • Casting a shadow on reflationary "Abenomics" polices, Japan's economy shrank by 0.6% on an annualized basis in Q1.
    • That marks the end to eight straight quarters of GDP expansion, the nation's longest growth streak in 28 years.
    • Economists say the contraction will be temporary, but there is chance that trade friction with the U.S. will hurt export demand.

    Global Synchronous Recovery Collapses As Japanese GDP Plunges In Q1. 

    • More departures? Tesla's (NASDAQ:TSLA) energy unit lost two executives after CEO Elon Musk announced a "thorough reorganization" of the company.
    • They include stationary storage unit product director Arch Padmanabhan, and Bob Rudd, a former SolarCity executive who led commercial and utility sales.
    • Sources also suggest that Model 3 production will be halted for another six days, while George Soros took a $35M stake in Tesla convertible bonds, giving the EV maker a prominent supporter.

    It Gets Worse: Tesla Now Has To Compete With $50,000 Electric BMWs Going For $54/Month.

    Wednesday's economic calendar

    Asian Stocks Decline as U.S. Treasury Yields Climb. Stocks in Asia followed their American counterparts lower as geopolitical developments and rising benchmark U.S. yields spurred a return of risk aversion. Equities in Japan and Korea were lower after U.S. stocks halted a four-day rally with the steepest slide in almost two weeks. Australian shares bucked the trend. Earlier, yields on 10-year Treasury notes rose to 3.07 percent, the highest since 2011, after upbeat U.S. retail sales data fueled bets the Federal Reserve may raise interest rates three more times this year. Bloomberg’s dollar index steadied close to a 2018 high. In emerging-markets, equities dropped the most since March and currencies slumped the most in a year. The MSCI Asia Pacific Index fell 0.1 percent as of 9:21 a.m. Tokyo time. Topix index fell 0.2 percent. Kospi index fell 0.4 percent. Australia’s S&P/ASX 200 Index rose 0.1 percent. Futures on the S&P 500 Index fell less than 0.05 percent.


    • "The recent jump in oil prices will take its toll," according to the IEA's monthly report, which cutglobal demand growth to 1.4M barrels per day for 2018, from a previous estimate of 1.5M bpd.
    • OPEC and its allies have finally succeeded in their 16-month campaign to clear a global oil glut and markets are set to tighten further as output sinks in Venezuela and the U.S. re-imposes sanctions on Iran.
    • Crude futures -0.6% to $70.92/bbl.
    • The American Petroleum Institute reportedly shows a build of 4.85M barrels of crude oil for the week ending May 11, vs. a draw of 1.85M barrels last week.
    • Gasoline reportedly shows a draw of -3.37M barrels and distillates show a draw of 768K barrels.
    • Nymex June crude recently was at ~$71/bbl in electronic trading, below today's $71.31 settlement price.

    WTI/RBOB Drop After Surprise Crude Build. 

    • Helios and Matheson Analytics (NASDAQ:HMNY): Q1 EPS of $0.09 may not be comparable to consensus of -$1.38.
    • Revenue of $49.4M (+3532.4% Y/Y) misses by $5.55M.
    • Shares +3% AH.
    • Press Release

  38. What the chat member think of this?, perhaps selling calls?