Friday Already?

No TGIF today, how can they stop the week just when we're getting into such a good groove?

Thank you Google – we are in full-blown recovery mode with the Dow just blowing through 12,900 in the pre-market.

I think I've said quite enough about Google in the previous post so let's pretend something else is happening for a few minutes…  Asia had a nice rebound with the Hang Seng regaining 266 points and the Nikkei posting a more cautious 80-point gain.   Our TM calls should be rockin' and rollin' today as they were one of the leaders in Japan's rebound.

"The rest of the world didn't take too much of a notice [to the Asian selloff]," said Andrew Clarke, a sales trader with Societe Generale in Hong Kong. "The U.S was pretty calm, Europe was pretty calm, it was perceived more of a local panic rather than anything else, and here we are bouncing again."

The dollar is dead and blah, blah, blah – if no one else cares why should we?  We have now entered into  a very funny/complacent phase of the market where a drop in Asian markets don't bother us and a collapsing US economy doesn't bother Asia – it's a big world out there and we are moving from first to third in style!

SNE/ERIC's net more than doubled (again) as high-end phones continued to make them a fortune.  Anyone who doubts that Apple is right on target with the IPhone needs to read their release which shows an incredible demand for top of the line phones.  Average phone sales dropped however, and worried analysts.  Hitachi put plans for a new flat-panel display plant on hold so today will be a good day to sell the TXN May $32.50s for a buck as a cover on our leaps.

Europe actually had a good close yesterday and is posting 1% gains across the board this morning but a lot of it was a commodity rebound (boo!) as the general attitude about China's attempt to reign in growth is "so what are they going to do, slow down to 8.5%?"  MT is making a huge comeback as the Arcelor deal moves forward.

We should get leadership from MCD, who posted a 22% jump in profits, along with a deal to franchise 1,600 more restaurants in Latin America.  CAT also gave a great report so the Dow really can't help but have a good day.  This means it's time to notch up the mattress play we still hold on the DIA $128puts, moving them to $129 or, dare we dream, $130 for the weekend.  Let's keep an eye on our market levels and try not to be too distracted by our Google profits:

Amazing how these greens sneak up on you isn't it?  I love my new system, it's been a big help in keeping us from panicking the past couple of weeks as we keep a nice global perspective on things.

We're going to ignore oil today as it's expiration day and contract rollover day so let them have their fun but we will likely short into the weekend if they attempt a run-up but we'll decide that in comments today.

Will gold rally and, if so, do we want it to stop?  Remember last May the party was over for the markets when oil and gold pulled back and anyone who doubts the value of shorting oil should look at the returns we made then, when everyone else was screaming. XOM's (for example) crash was much worse than the Dow as a whole and, frustrating though it may be – now that it is 20% ahead of the broader market, it still makes my favorite insurance play.

Happy Trading says to watch the Nasdaq and it sure does have a lot of catching up to do:

This will truly be a great day, we couldn't have picked a better time to hold a bullish position – even our pokey IBM $95s that we added at .10 yesterday might pay off!

Have a great weekend,

– Phil