Wowie! That was some day. If you have to look back in a few months and see where the turning point was that led to Dow 13,000 and Nasdaq 2,500 then today would be the day you can point to!
The strong Nasdaq recovery caught everyone off guard, especially as it punched through and closed above 2,300. The Dow zoomed right over 11,300 while the S&P poped right back over 1,300 like it was very comfortable there. All huge!
The SOX are still bugging me with TXN down a touch and AAPL not able to hold nice morning gains. AMAT was a very late mover but SNDK was strong all day. MU got whacked 3% and didn’t recover but AMD recovered from 2% down so maybe the mail is just slow getting to Micron or maybe the LEXR acquisition is worrying people there. CY, of course, went up!
AAPL is now officially baffling me. I don’t know who’s selling it or why but sell it they do, every single day, into every rally… I hate to say it but the 200 dma is $57.50 and if we don’t hold $60 I think that’s where it’ll end up.
Oil got jacked up again at the end of the day to finish at $62.04. As I noted in comments this morning, I apologize for continuing to refer to oil at $60 after the rollover which put it back to $62. So the new line to hold on oil is $62 and it was amazing to watch how much effort was put into it this afternoon! Natural gas could not recover $7, finishing just below with gas inventories out tomorrow.
Unlike oil, gas is produced almost entirely on this continent so you get a more honest view of supply from gas than you do from oil. I missed a huge short opportunity today as I left all fed up with the oil drawdown not remembering why I recommended TOPT on the 13th – they are making more money because people are redirecting tankers that were on route to the US!
So of course we had a drawdown. As the detailed data came out it turns out we imported 1M barrels a day less than last week! It’s a long slow process but it all backs up somewhere eventually and then the prices have to drop. VLO traders saw this at 1pm but I didn’t get back to do anything about it until 2:30 when I missed the whole move. I should have just stayed out but now I am sitting on the puts until tomorrow.
Gold remains rangebound at $551 which continues to indicate that nothing too scary is out there so we can hope for the best! All it will take at this point is a kind word from the Fed and we are off to the races…
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TOTD VNO started out so good but snapped back on us but the $95 puts finished at $1.85 (up 30%) due to perceived increase in volatility. There was a point early on when they were selling for $2.70! BXP had a flatter day but still gained 20% on the $90 puts while EOP was better behaved as the $35 puts finished at $1.95 (up 60%).
As predicted both BMY and SNY tacked on 10% today but both were up too much in pre-market to take advantage of it.
FRE dropped right off the bat and finished the day down .50 and the $65 puts ended at $1.60 (up 15%) but FNM went straight up all day 2% and the $55 puts lost wound up at $1.50 (down 15%).
GM went up too fast to buy calls and down too fast to buy puts. There really is no hope for this company!
AMAT had me worried right up to 2pm when it took off but the $18 calls moved nicely to .45 (up 30%). Obviously with calls this small you have to make a dime before it means anything!
FDX did exactly what we wanted, bouncing off $111.50 giving us a $1.50 buy at 11:15 and then moved right back up to $114 so the $115 calls finished at $2.40 (up 60%). I hit that one on the head as $1.50 was the low option price of the day! (pat pat pat!)
http://finance.yahoo.com/q/bc?s=FDX&t=1d
NYT took a nice bounce off $25 but I need more than that to prove it’s a bottom. Lots of room to rise once this starts recovering.
SNE was indeed a great market indicator and it gave me faith to buy more QQQQs this morning! Notice the move once it broke the 50 dma at $46.50!
http://finance.yahoo.com/q/bc?t=1d&l=on&z=m&q=l&p=&a=&c=&s=sne
AAPL started out great then died, very depressing! The $62.50s peaked out at $3.60 (up 10%) but I held mine to the bitter end where they closed at $2.85 (down 8%). I don’t consider that greedy, I didn’t plunk down $3.10 to make .30! This stock is starting to be RIMM level poison to invest in…
NVDA $50 puts finished at $2.35 but it opened high and stayed there so no trade.
MS $60s never came down enough for me to buy but they finished the day at $2.45 (up 50%).
GS had another huge day, gaining 1.6% with a flourishing Cramer pump at 3:30 (he targeted $200). The financials are currently leading the markets so wish them well!
I should have known something was up when MUR went up to $48 and the $45 puts were still .65. I chickened out and sold them but the stock quickly fell apart. (kick, kick) But I was right about the value as the options closed at .60 anyway (change of sentiment).
http://finance.yahoo.com/q/bc?s=MUR&t=1d
DELL held up very well and the $30s went back to $1 bailing out those of you who didn’t take a double when you could have yesterday (please don’t tell me you’re still holding!).
Tomorrow is all about if Microsoft makes a comeback – I can’t wait!
Good trading,
– Phil
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Goodbye old friend:
For our 12/6 TOTD I said this about TMG:
“TransMontaigne rode out the hurricanes much better than expected but fears of disaster dropped this small ($300M) petroleum distribution company from $13 in August to the $7 we can get it for today.
Nobody tracks this poor little stock but their rates have gone way up but are less % per barrel than last year so no one is complaining. I’m complaining that I didn’t catch this in October when it was at $5 but wah, wah – so I’ll just buy it now.
First quarter profits, reflecting the new rates, were up 500% from last year on 45% more revenue. The trailing p/e is 5 and the forward p/e and PEG ratio are so low that Yahoo brings them up as an error.
The company is selling at .92 of book value with the whole market cap being $350M on sales of $8.5Bn. So if this company figures out how to make just one penny more per dollar of revenue, they will increase revenues by $85M – I like those kind of companies!
They are expanding so quickly that A/R is sucking up cash flow, not the worst problem in the world but it has skewed the books too make them look less attractive than they really are.
You can pick up the March $7.50 calls for .40 but for $7 you can also just buy the stock! First real resistance will be the 200 dma of $8.50 but that was pulled down for no good reason so it may be a long time before I want to let go of this one.”
Today Morgan Stanley offered to buy out the company and the stock shot up to $9.22!
