"Thanks gang. Also…thanks for the training that set me up to be up 13.5% on a down day like today. That NEVER would have happened without the day to day classes all of you have been giving." – KeyserSoze Posted July 26, 2007 at 4:48 pm Permalink
What can I say? I'm very proud!
We had a fantastic day as everything went perfectly for our short positions, especially our mattress plays that usually protect our virtual portfolio but today were the stars.
It also didn't hurt that we've been short on oil for the month and it finally paid off in spades, especailly our old buddies XOM, who lost about $26Bn in market cap in what can only be described as a rough day. As I mentioned in yesterday's wrap-up, we were keying on XOM and the XLE for put plays, capitalizing on the strategy Zman and I have been playing up for weeks – that producing less oil leads to less profits!
Our MN1 broadcast pick, the PTR $150 puts, had a fantastic day as well as they doubled on the $5 dip. We held onto those, hoping for a very hard slap in Asian trading to drive the stock back to the 50 dma at $143.
Our Apple plays (also reviewed last night) went off spectacularly, with the stock coming in right at our sweet spot and we closed out $135 calls for a 20% loss, the $140 calls for a 105% profit, and the $135 puts with a 50% loss leaving us open with the Jan $150s with a 121% profit, the Oct 140s with a 223% profit and the Aug $150s with a 32% profit in the Complex Spreads Virtual Portfolio, putting it up 135% for the year, an 11% gain on the week. We also still have the Jan '09 $140s, up 20%, against which we sold the Aug $140s and $145's in the Long-Term Virtual Portfolio.
Tomorrow it will be our CROX Sept $50s that make us very, very happy as the earnings were so good they had to halt the stock! We also have a spread of the Sept $52.50s and the Aug $50s in the $10KP that cost us a nickel so we'll be looking for a dollar or so there if we can get it!
We took a neutral stance into the close but, like the great Yogi says: "It ain't over 'till it's over" and we moved into the close with very mixed feelings as the Plunge Protection Team was clearly scrambling with Paulson running around telling everyone to remain calm, which only served to make me nervous! Paulson scheduled a pre-market interview on CNBC tomorrow so we went a little longer, just in case but I warned at 3:39: "If the FXI (off 4%) is a good predictor of the Hang Seng, we could see a 1,000 point China drop tomorrow to get us rolling!"
Paulson's pals at GS looked anything but calm as their stock plunged another $8 to what looks like support at $195, down $38 since June 1st as deal after deal gets called into questions and the oil and other commodities they've been pushing on the planet start to lose their luster, much like gold, which also slipped $11 to possible support at $662.
It was a tough day for the Dow, which bottomed out 449 points before bouncing, finishing at 13,335, 5% off last week's high, while the S&P clawed back from 1,465 to finish down 35 at 1,482, EXACTLY 5% down from last week's highs. The Nasdaq was our strongest index, dropping just 4.5% for the week but closing just under 2,600 in need of a serious lift. GOOG was no help today with another $2 drop but at least they took a nice bounce off $500
Happy Trading says we need the S&P to show us the money tomorrow and I say we will need that Nasdaq leadership to pull it out so we took the QQQQ $49s to cover our remaining DIA puts:
Happy's excellent streak of picks continues, all still available for FREE on his Happy Trades tab:
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FCX Aug 85 puts, FCXTQ, at $2.2, +12.8% (partially out)
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MRO Aug 60 puts, MROTL, at $4.6, +35.3% (partially out)
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MRO Aug 60 puts, MROTL, at $5.2, +53% (all out)
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RIMM Aug 210 puts, RFYTB, at $4.2, +16.7% (partially out)
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RIMM Aug 210 puts, RFYTB, at $4.5, +25% (more out)
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AMZN Aug 90 calls, ZQNHR, at $2.85, +9.6% (took some off)
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AMZN Aug 90 calls, ZQNHR, at $3, +15.4 (all out)
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FCX Aug 85 puts, FCXTQ, at $2.25, +15.4% (more out)
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RIMM Aug 210 puts, RFYTB, at $4.3, +19.4% (all out)
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FCX Aug 85 puts, FCXTQ, at $2.05, +5.1% (all out)
That's right, we have trades for every market direction, sometimes all in the same day the way things have been going lately!
Zman showed some amazing flexibility by picking winners with NFX calls and FTO puts even as our earlier HOC pick went lower than low today. NFX was up 10% from Z's Thursday morning featured pick and pulled back to up 'just" 5% by the day's end but he gave us a perfect exit at 10:41 saying: "Coming out of some NFX $45s now. 100% since yesterday is too good to miss. Will add $50s later but that gas number could pull it all in a bit." Kudos to ZMan for an excellent earnings play and the much appreciated play by play during the conference call!
Congrats to all on a great team effort! It was a very exciting day and we have no idea what the market will do tomorrow but at least we do know that we'll be ready for it – and that's a good thing!
