Asia is on a tear yet again and Europe looks strong too, the question is will there be any money left to be put into our markets. We can hope that chart watchers will be encouraged by the Nikkei just thundering on to new high after new high, almost without pause.
The Hang Seng had a very slow start but finished with a bang, up 135 pts (1%).
If we don’t have a good day today then pack it in! I am, in any case, very very concerned that this whole rally is a pump by the funds who are looking to put a great quarter on the books and we will really pay the piper come Monday so, other than oil puts, I will be cashing out almost everything by tomorrow. If I’m wrong, we have many, many ways to get back in with all our cash.
The dollar is pulling back, lifting oil, gold, etc. but gold is also just heading up and up. Don’t forget to get the hell out of gold trades as soon as it falls below any $5 level it passes as the stocks tend to overreact to any pullback.
The UN Security Council made a statement that Iran should suspend uranium enrichment but did not threaten sanctions. Still oil goes up… I’m going to take a fairly risky oil bet which I will detail tomorrow but I really feel this one in my gut!
Today is April contract expiration day for refined products so we will watch gasoline prices closely. Also, the natural gas inventory is out at 10:30 where we expect a healthy build.
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Google Google Google – ok now that that’s out of the way…
I made a fatal mistake yesterday of spending too much time in the comments explaining to people why it would be smarter to take the Google money off the table when I should have been making sure my own sells executed. I even said at right about 3:30 that I was very concerned that no one would pay .10 over the strike for the calls I was offering up and, unfortunately, I was so right and it dropped so fast I didn’t get to sell other than my $420s.
Actually that’s not true, I could have sold right up to close for 25% less than it was at 3:30 but I stupidly held on hoping it would come back a bit and by 4pm it was too late. Then in the after hours, Google announced that they would float an additional 5M shares and the stock took a dive.
While I still think it will recover, the options are not likely to rise back to the same level as some of the air is now out of this tire and (read comments for details) there was a masterful game of manipulation that set $400 as a pretty firm upside barrier.
The worst thing it that I miss an opportunity to buy back in this morning for substantially less than I could have sold yesterday, so I am missing out on chance to make a really great trade because I didn’t let go of another one!
I will comment on today’s action but unless there is strong volume buying today this party may be over but I really still don’t see how the funds could have filled the shares they need. My conspiracy hat still tells me that this is all a big con to scare people out of their shares and flush out the stops prior to what still has to be a big run but I would feel much better with the cash I could have had yesterday than sitting around today hoping to get back to where I was!
It was greed pure and simple, I had a 500% gain and when it went down to a 400% gain I didn’t take it off immediately because I wanted my 500% back. Stupid, stupid, stupid! This is the classic example of do as I say, not as I do because I would kick your ass if you told me you did the same thing!
Well, it’s good to get spanked once in a while (that’s what I tell my kids, anyway) but this was one expensive spanking if it doesn’t recover!
Let’s keep an eye on Germany to get an idea of the action in Europe (even though the volume is very low), notice an early rally off a very poor open followed by a decline so far in the afternoon. They are spiking up now into the US open but we’ve still got 2 hours to worry about it!
http://finance.yahoo.com/q?s=GGQ1.DE
The best thing about the German chart is there could be a great opportunity to buy more calls at $370 if the stock gets forced down that far again (don’t forget to convert Euros!).
Also, let’s remember that Yahoo, on inclusion date – 2, ran up $12 and retraced 50% at the close so we are still on track here…
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BIDU exploded overnight on rumors that Google is raising capital to buy them. Google already owns a piece so I doubt that and I would take profits off the table as soon as this one looks toppy today.
MSM had a nice 7% beat and revised guidance up another 5% so this should run up fast but I think a lot of this has already been baked in as the stock has run up from $40 on Jan 1. There are no options but it might make a nice short play as it tops out either at $55 or $57. Stop out at $60.50 but reenter after that if it goes that crazy but I doubt it.
MOT and NOK should both be strong today as Nokia sees 15% more demand than previously thought. MOT, as usual is the better play and I already wish I had doubled up on my $22.50s when they were down last week but I still like them at .90 (a .25 premium).
NAK is dragging behind the gold market and I love it at $6.25 for maybe a buck upwards.
ABX is way out of step with gold as well. The $27.50s are a steal at .40 (a .80 premium).
NEM is very risky but so far behind I like the May $55s for $1.30.
I don’t understand why AH has a p/e of 16. It’s not like the war is going to end… They just got another order and that should kick things up a notch, not because the order is big ($36M) but because it signals the army is still spending despite all the hand wringing in Washington. The $60s make a nice momentum trade at $1 if you take a quick profit.
I don’t know why people were bailing on NVS lately but they are getting an FDA review of that diabetes treatment we talked about a couple of weeks ago so I am really liking the $55s which should open at about $1.30 (a .55 premium) as a day trade with a tight stop.
As a long term play I like PZZA doing a deal with PKS to be the exclusive pizza vendor. That’s 20M potential new customers trying their stuff this summer. I meant to buy them at the last pullback but I forgot (kick kick) but they certainly have another $5 or so in them so I like the
July $35s for $1.10.
If ORCH escaped delisting due to delayed financials they may make a good buy. Small biotechs are too dicey for me but if this comes down around $4.50 I may put some away for a rainy day. Very long term and very risky!
I don’t know what GLW did today other than spend $15M in China but it’s rewarding the patient among us with a nice run. The $30s for .30 make a nice quick momentum trade.
EK is another cheapie that could pop and the $30s are just .45 but, as with all these trades, please please take 20-50% profits and run!!!
Well GOOG luck to all the gamblers out there today!
I’ll be watching the comments but I vow to pay more attention to my own trades today so don’t expect prompt responses!
– Phil
