It looks like my global rotation theory is panning out!
I’m as amazed as you must be that I seem to have actually figured out what’s going on in the World that I am still thinking I must be wrong so let’s stay just a little cautious because, if I’m really right, we have a very long rally ahead of us.
We retook a lot of technicals today with the Dow zooming right back through 10,800 and the Nasdaq opening well above 2,250 and then using it as a floor on the way to 2,266. The S&P bounced nicely of 1,255 twice before gaining 10 pts for the day so we’ll call that the new floor.
The real turning point of the day was when the NYSE turned up sharply at noon and then again at 3pm. http://finance.yahoo.com/q/bc?s=%5ENYA&t=1d
Oil was down almost all day and the Valero traders weren’t buying it for the most part. The stock never really recovered but I ended up stopping out of most of my oil plays so I took a few new positions that are detailed in today’s comments. More significant than todays drop below $63 is the March contracts finished down another .54 (after $2.02 yesterday) to $63.09. This backs up my thinking earlier today (comments) that oil prices were being artificially supported.
Another clue that the market manipulation was the fact that my SU Mar $75 puts actually gained value while the stock went up over $1 this afternoon. That indicates behind the scenes activities are playing out.
Gold held firm at $549 despite negative comments from our former fed chairman who feels he still needs to pontificate.
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So what a day we had today!
It turns out that Whole foods is just a grocery store! Who’d have thought? I’ve been saying it since they were at $155, perhaps now people will stop buying this stock. Although they only missed by a penny, expectations were already lowered and margins are clearly contracting.
HYDL is worth watching again tomorrow as it inexplicably went up 2% today but the $75 puts gained 30% in value – go figure.
OIS continued down another 2% today. WHQ also never recovered. I hope you took the 100% profit on SLB before it turned on us but the March $120 puts are still $6.50, up $2.50 from yesterday. This is why I like the extra month, the Feb $120s lost 50% more value.
IBM had a heck of a day but the March $80 calls still look very good at $2.30.
BCRX had a very weird day, dropping very hard in the morning on what looked like someone exiting a large position. I now love this stock at $17!
MOT – what can I say? I know this stock like my children…
CSCO had the strong finish we were looking for and we will probably be executing our buys in the morning.
PFE had a day that was only stopped because they ran out of time! Amazingly, the Mar $25s opened at .85 and gave us a one day double (but I confess I didn’t sell).
Can’t wait for tomorrow!
