On the whole, this was not a good week for the market. Although it stayed above resistance levels on the way down, it showed very little ability to go up.
I am very glad of Monday’s decision to go 1/2 cash in this directionless market.
Even Friday’s $2 drop in oil failed to act as a stimulant.
Gold dropped $30 for the week but the NEM Jan ’07 $45s actually gained .50 from our open while the Dec $55 expired worthless and gave us another .80 profit. If gold holds $500 this month, it will be a safe bet for the year. This month, I will sell the Jan $52.50 for $1.35 since I am not confident in the direction.
Monday’s TOTD GG was a disappointment for the week if you didn’t get out on the pullback. Buy out the Jan $22.50 at .25 for a .75 profit if you are still in it as the risk reward isn’t there to let it ride. The stock is sitting right on the 50 dma which has proved to be a good support. Absolutely get out for a small loss if the stock goes below $19.50.
INTC Jan $25s are up to $1.65 despite an up and down week for a 30% profit.
SHFL Jan $25s picked up an amazing 60% from Monday’s call, I am out of this one.
HSY May $50s hit out target of $9 so we are out with a 23% profit.
The TWX Jan ’07 $15s look strong for $4, a .30 profit to date. I will be looking to sell the Jan $20s for .50 if I get the chance.
MOT is close to my $22 entry point. As predicted, NOK was a much better bet for the week.
Oil stocks did not have a great week in the end but we were saved by following the Valero Rule (see link on right). If oil prices come back, look for COP to be a new leader.
YHOO actually outperformed Google for the week, as expected.
BCRX and MYOG remain strong. The BCRX Jan $15s are up just 10% but we could have picked up an extra quarter if we had sold the current $15s (albeit with a lot more stress).
VIA suffered from spending $1.6Bn on Dreamworks but not as much as I thought it would.
WMT Jan ’07 $45s picked up 8% and we may get called away on the Jan $50s but that should give us a nice 30% profit anyway.
GGR outperformed the sector. There is still no official news but we will continue to follow this closely.
FSH Jan $60s dropped $1 while the Jan $65 calls lost .70, steady as she goes on this one. Remember, we expected it to go down to $62.
Palm was an excellent choice on Tuesday but RIMM won a round this week so hold with caution. If you sold the call for $1.95 then your basis is $27 so we are far from panicking on this stock.
SNIC went down .60 since Tuesday’s pick but I think it is purely due to option play. We will watch this next week.
I hope I saved someone a lot of pain by calling an abandon ship on Microsoft on Tuesday morning!
MRK and especially PFE got an after hours jump yesterday due to a Pfizer patent victory. I certainly did not see that coming… PFE slammed right into the 200 dma of $25.25 after hours and I will be very curious as to where this goes.
I picked up the HAL Jan $65 calls for $3 and got quickly whacked for 30%. I will wait for next week’s oil moves before dumping out though.
The home builder picks may have been a little early. BHS gained 2%, LEN 5%, WLS -4%, TOA 5% with my other picks flat since Wednesday’s pick. CVCO continues to be a star, up 10% since Monday’s pick.
HPQ had a bad week, as predicted.
CLE went the wrong way on the Feb $30 put by 25% but I still say it goes down.
EBAY had a great run for the week but that $47.50 is becoming a troublesome barrier as we expected.
12/9 TOTD LLY is in fantastic shape with the April $50s now at $7.50, a 60% profit! No reason to sell yet but stop should be no lower than $7.25 as it may pullback and there is no reason you should suffer.
I guess I am happy with picking TSO over VLO but not the way I wanted, VLO had a massive drop that TSO avoided but that is not the way I wanted TSO to catch up.
We hit the exact bottom on HET on Wednesday (I hope!) but it didn’t get above $68 yet (in fact it was rejected on Friday am) so we will watch it carefully.
GENZ continues to look for direction.
PKS Jan $7.50 puts lost 60% since Wednesday. I believe a downward spike will retest $7 in the least but I will be happy to get my .60 back on this one so I am putting a sell in there.
If you didn’t get out of CHK with the recommended stop, shame on you, but if you sold the Jan $35, you picked up .60 on that so no real harm.
Wed TOTD GD was complicated but the spread saved us as the Jan ’07 $120 puts lost $1 but the Jan $115 calls gained $1. The stock took a hard bounce off the 50 dma of $116 but I think it was just an option thing. As we said Wednesday, this is a dead trade.
AMGN blew right through my target of $78.75 but that’s good enough for me to sell.
BSC gave us a charitable $112 entry and is up 5% in just 2 days. At this point I use a $1 trailing stop.
MO Jun $85 calls did not gain anything from our $1.70 entry, even as the stock went up 5%. I can’t explain this but I am happy to hold onto these atm.
SNDK blew through our $55 target with a vengeance, 8% in 48 hrs is plenty for me on this risky stock so my stop is a trailing .50.
TOTD TGT got whacked on Friday, I should have been more patient and held my original target as I could have gotten the Jan $50 for $4 instead of $4.50 that I took on Thursday. Either way, the stock did exactly what I thought so I am happy for now.
