EWJ – I like it BECAUSE it’s dropping! Only if Europe closes at least flat and we hold up, otherwise we’ll just wait for a bottom. EWJ May $14 at .65 right now.
Google doesn’t really have any room for upgrades, it’s a buy by about 36 out of 40 analysts. Price targets are being raised but people are having trouble believing it so it will take a clear revenue catalyst to kick it up. I think we need to use 20% of the profit trailing stops and look to move into longer (Sept) positions if we are flatlining as we can make some very good money selling until they break $500.
IBM – I just got stopped out on half my rolled $95s in fact as they just fell from $1.80 to $1.70 but that’s up .25 off my $1.45 basis so now I’m in on 50 at $1.20 with a $1.60 stop. If that stops out I’ll have a buy for 20 at $1.25 as I’d be willing to DD again at .65 (again, unless the markets tank).
OVTI – excellent choice Greed! They don’t report till late May or June but expectations are very low and they’ve been holding a rising 50 dma very well since recovering from the Feb crash (they were at $14.25).
Jan ‘09 $15s are just $3 and you can sell the June $15s for .70 but I’d rather wait a bit and see if they can get a run going so maybe a sell stop at .50 on those (almost certainly sell before earnings though as they are bound to be down from last year).
Wow – hit TSO on the button but no victory lap yet, this thing is like a rattlesnake! Nonetheless, I think Happys MM rule applies here and the people who were forced in the money on Friday are just getting shares stuck to them right now so I’m taking the VLO $67.50 puts at $2.25 with a .25 trail stop.
FDG is an underperforming coal as they have to compete with local Canadian gas but they generally catch up eventually. Their earnings are today and they are a very poorly managed company but it’s so easy and profitable (dig coal, sell coal) that they still have a p/e of 8. They may not break out now but what the hell with the Jan $25s at $1.35 as you can sel June $25s for .45 (but I’d rather wait for earnings with a small risk and roll down if they’re bad)
Buying CME Sept $600s for $18.65, will also buy May $520 puts for about $4. Selling May $540 puts for $9.25 and possibly May $590s if they get to $8 on a run.
QCOM – rangebound on a rising ma for a year, makes them a poor option play unless you’re selling them. I like the Jan $45s for $4.40 and selling the $42.50s for $2 as they are unlikely to have a big beat but make a great long-term hold.
AAPL – July $95s for $5.55 selling the May $95s for no less than $2.50 but hopefully $3+ XXX
Europe finishing flat so no help there but no hurt either so it’s all up to us to set the direction today – perfect for my morning plays. I’m going to start with the EWJs and see how they go but, again, only if we hold up through the close.
I’m a little uncomfortable with market internals right now – lots of stocks showing weakness the minute Europe shut down. If we don’t hold 12,940 it might be a good time to consider the DIA $130 puts for $1.55 if you’re not already in the $129 puts (now $1.17). XAL is in a power dive and you cannot convince me that this does not matter.
MTU is still in the LTP but I’m not very enthusiastic about its performance so far, I may be giving up soon.
Gun battles in Nigeria – watch those puts!
DIA – at this point I will be happy to lose a dime or two if I’m wrong to take the DIA $130 puts for $1.60
Posted April 23, 2007 at 2:05 pm | Permalink (Edit)
OH No! GM blaming sub-prime for their inability to sell cars! Very bad – setting 20% profit stops on STP contracts time to take things off the table!!! At 12,900 we need to start protecting LTP but some of that may be accomplished by DIA puts as we reduce the level of STP stocks that it is protecting.
I’m not saying panic but this is the kind of talk that can cause a big pullback. Let’s not forget that GM has no credibility though but now reporters will be asking everyone what they think about this.
There is no bottom to XAL!
Out of DIA $130 puts at $1.75. Not taking a chance as I already have $129s and making a quick 10% is good!
DD on MRVL $17.50s for .35 (setting .25 stop on whole). Being a little more bullish on SOX as they are already beaten down – see if SOX holds 483.
NKE $55s – DD at .40 (stop at .30)
Out of TGT $60s at $2.45, roll to $62.50s at .75 (if possible), otherwise apply .70 profit to basis of existing $62.50s (.40) and set stop at .80 (now .90).
XOM Play
Buy the $80 calls for $1.20 and the $80 puts for $1.80 = $3
Sell the $75 calls for $4.80 and the $85 puts for $5.80 = $11.60
Net to you is $8.60
If XOM is over $80, you owe your caller $5 (more than your $80s are worth) and no more that $5 to your putter = $1.40 max loss
If XOM is under $80, you owe your putter $5 (more than your $80 puts are worth) and no more than $5 to your caller = $1.60 max loss
Any move by XOM more than $1.60 off $80 is up to $5 profit. Your losing range is $78.40 to $81.60
As I already have the $75 puts, I am doing this but selling the 1/2 the $85 puts against my existing position which is riskier but I can take them out on a mo play (I hope). XXX
NOTE – I HAD THE WRONG NET – WAS $10.60, NOT 11.60 WHICH WIDENS THE GAP BY $1 ON EACH SIDE SO THIS IS NOW A GET OUT TRADE, SETTING 20% STOPS IN EITHER DIRECTION AND WILL LEAVE THE WINNER AS A MO TRADE.
DIA – part of this plan is, now that I made .20 on the $130s, I can take the $128 puts a little earlier than usual, perhaps at $1.25, probably around 12,875. As that would still be a 60-point drop from here, I’m not going to worry about missing anything in the overnights by just holding my $129 puts.
CME – Very differenct with the $8 drop. Sept $600s only went down to $17.20, not bad really but closer calls got killed.
If earnings aren’t in the morning then June $560s are just $16.55 and May $530 puts are $6.90 (a $2.90/$10 upgrade of the earlier play) so it’s a bullish call played for a $30 (5%) move.
