All gold plays are good, I rolled mine yesterday as they were up too far, the same contracts I took off the table in last nights post at the next just out of the money strike are best. GDX is my current favorite as we don’t know if any individual miner may miss on costs.
GS, I would expect a muted reaction until tomorrow as they try to get rid of callers like you but how can they not go back to their highs on those earnings?
CKR – I’d leave them alone on the short side. We didn’t expect a great report and lots of the internals look like they could perk up.
Ouch, dollar off .67 at the open. That’s real bad for the markets to dip while the dollar does.
Since most of my callers are in the money and I am certain I will be around to do it tomorrow, I am going to hold off on rolling them. At the moment, if we are flatlining through tomorrow, I will try to roll my guys up one bracket. If we turn down, I will roll to the same strike price, keeping more insurance in exchange for less premium. If the market skyrocket, I will be tragically wrong!
BIDU continues the insanity.
MT at ATH. NUE Oct $60s are $2.62 and you can sell the current $60s, now .60 if it has trouble breaking over. XXX
BIDU continues the insanity.
MT at ATH. NUE Oct $60s are $2.62 and you can sell the current $60s, now .60 if it has trouble breaking over. XXX
Buy program kicking in – big one!
DIA $138 puts can be sold for protection at .70, must stop out at .85 but good protection for long DIA puts. XXX
Paulson (former GS chair) just made some comments that shot up the market – they are pulling out all the stops to keep the markets up. Cramer made another speech telling people to keep buying yesterday after his “don’t sell your gains” speech the day before. It is hyper-critical for them to hold 13,700 to make the charts look pretty and it seems like no one is taking any chances. Even the Prez is gooing to say something, you can’t fight this kind of effort.
POT is at a new high, PEP is flying and makes a buy here Apr $72.50s are $3.75 XXX
FSLR – I’m betting on $100 but I’m up a lot on the trade so I’m not worried.
If BSC breaks yesterday’s mid-point at $117 then I think we’ll go very positive but I still see a lot of weight dragging the markets and the buying seems very forced to me. Still, international players are the way to go, which makes it very surprising that the Dow can’t get it in gear and who is more international than XOM, also not moving?
BDK flying, they almost took off yesterday so the Oct $90s at $2 are good for a mo play, keep them if they break $88. XXX
CY breaking out with SPWR.
Oops, here’s Bush. He’s mad at Congress and threatening to Veto and suddenly he’s concerned about $50Bn in spending because it might help too many children get health insurance.
Yet another wave of buying coming in, very well timed stuff but lots of sellers showing up at yesterday’s closing levels. We could do this all day.
Gold at $745, oil up but gas is down on a 63Bcf build, we are back to last year’s level at 3,132Bcf (less 32Bcf).
BMY – still holding Septs for insurance, will roll to Oct $27.50s.
By the way, I look at the spreads I expect to get, like moving the AAPL $130 caller to the Oct $140 caller and I decide how much I’m willing to lose ($4) and I make an offer for the roll. If I get it great, if not, I deal with it tomorrow. That goes for plays where your current caller is in the money and has no premium and you are rolling to a caller that is also in the money.
Rolling example: I just looked over my best case on the BSC $115s, now $4.20 I have a caller on vs what I can now get for the Oct $120s, now $5.30 so I put in a roll bid for a $2 credit and I’ll see if it executes…
Philly Fed was 10.9 vs 0 expected and new ordrs were double expected AS WERE PRICES PAID – THEY WERE DOUBLE EXPECTATIONS!!! We will rally on this because people are idiots but we still haven’t gotten all three main indexes to stay green at the same time.
YHOO I’d move him to 2X Oct $25s at $1.50 so you know you’re getting $1 in premium from him. You can move yourself back to 2X Jan $27.50s at $1.45 so you don’t even have to dip in your pocket but you push him $2.50 away from the money and gain 2 more months to roll. This play is good for any folder as an entry. XXX
YHOO I’d move him to 2X Oct $25s at $1.50 so you know you’re getting $1 in premium from him. You can move yourself back to 2X Jan $27.50s at $1.45 so you don’t even have to dip in your pocket but you push him $2.50 away from the money and gain 2 more months to roll. This play is good for any folder as an entry. XXX
Bingo – as soon as the Dow touches green there’s a selling program. I don’t see a pattern to what’s being sold but it’s there on the button so there may be a very big shoe to drop near the close.
ABX – new highs.
RMBS – holding my caller as planned, poor little bugger… I’m well ahead and there was no way in hell I was going to turn it into a riskier trade because I was greedy (unlike some). Tough call tomorrow, I may only risk a few after closing out my caller.
One thing that gets hit in each wave of selling is the builders but now I’m seeing some high flyers getting chopped (RIMM, AMZN, ADBE, SHLD, MCD, PEG) looks like this selling thing may be catching on. S&P will be scary if they break 1,520.
MOT – used to be one of my favorite companies but they grossly misjudged the markets and got owned by NOK so I’ve walked away. They always look tempting to me but they are more like a bad drug habit than a company on the mend.
The way the buys and sells are going it looks like people on both sides are just looking to work their way out of positions, possibly just an EOQ thing for most.
GOOG $550 puts for under $1 very tempting!
Rolling – no, your in the money callers will lose money faster than the calls you want to roll to so you pay less to your current guy and still get (spreadwise) more from your next caller.
PTR – so ugly! Let’s spend $3 to roll them to the Jan $150 puts and then we’ll take it back by selling the Oct $150 calls but I’m going to wait a bit to sell. XXX
GS is going red – that’s amazing! If they can’t find a buyer we are doomed!
Rolled my GS O$195s to Jan $200s, will let my callers sweat it out before rolling them to Oct $200s, should be a tough barrier and $11.30 is good protection. XXX
RIMM $90 puts as a mo play .79 XXX
Buy Progs come back, massive effort to stay positive, possibly EOQ shenanigans possibly fund repositioning but I don’t see a rotational theme. But you can pretty much sell those DIA put $138 puts every time they hit .70 and buy them back for .55 over and over…
VOLV is the international version of CAT, deserves much more respect than it gets. I had bought the Apr $17.50s to make back the money I lost on the Apr $22.50s on what I thought was a baseless sell-off and they have done their job (2x up .60 against a $1.20 loss) so I will have little tolerance for a pullback. There’s no money in selling calls so it’s all about your conviction level on a thinly traded option but I’ll be surprised if we can’t get $19 on this run.
Check out GOOG! It’s flying along with the gold stocks, also a rare commodity.
PCLN came downnicely after all that worry.
Incredibly unrealistic pricing on the QQQQ $50s at .30, I sold them and I can’t belive how tenacious they are…
You’re welcome Andrew! That depends on the situation, like GOOG I just sold some sucker the Oct $550s as I thought there was no way it was going higher (and certainly not $17 in premium higher) so far I’m wrong by a buck…
Those $550 puts are just so tempting I have to pick some up, even though it is usually the dumbest play in the market.
Oil closed at $83.90 – ROFL. Party on Ben!
RIMM – too dangerous to hold with no time to expiration, just a momentum trade and I’ll probably give up at $90.45 if it gets there.
In general watch 2,650 for Nas support and 1,520 (here!) for the S&P. If we lose both of those we’ll probably reterst 13,700 and 1,515 on the S&P would be a bad break.
CHK, hmm, that was a placeholder for our hurricane play that went terribly wrong so we just need to roll to the Oct $135s for $1.35 and take our lumps for buying insurance this month.. Getting even would be nice now.
I don’t know what else I can say to people who have not been rolling up hedges on the way up. I think I just said the other day that I was consolidating my DIA puts into the $140 puts to get a penny for penny downside increase (and also the ability to sell high puts against) and we just talked about the Nov $137 puts as a good way to start a hedge for a spread once we get a pullback… Any time you make money you should take 30% of it and bet against yourself. That way you keep 70% of what you make – think about it!
GOOG – that position I moved to 2X Jan ‘08 $550s vs. 2X Oct $550s. Two months is $25 in premium in Google world so I’m pretty much covered to $600 where I could always roll back and do it again.
PCLN – another thing I can’t stress strongly enough – getting even from being way down is a great move!
2:1 Declines to advance. Russell down 1% (and they should be flying on the Fed), transports got FDX and oil and are down 1.5%, BKX down 1.7% despite GS’s shining earnings. XLF matching down at 1.3%.
GS – I would certainly follow them on a mo play but maybe the massive run up they’ve already had is it?
GOOG – yeah I just keep rolling up but that premium is worth collecting.
IBM – I got my price and ended up in the Jan $120s at $5.35 and I’m waiting to see what the septs do as they still have .40 in premium.
FWLT finally turning down. My boys at RICK making an ATH – that’s a good recession stock!
BHI taking off.
FXI – you can never count on them to go down. The best use of that play is to use it to chase a surprise Dow rally. I have the Jan $155 puts waiting for the 2,000 point sell-off that’s bound to come but it’s a small position to DD and roll until I’m right.
DIA – The idea is to buy what would now be the Nov $136s and $139s for about $3 each and then 50% more of whichever one gets to $2.50 as the Dow swings back and forth. Once you have 150% at $2.87, the next move, if it drops another 100, is to spend .30 to roll it down. If your sides are even, do the same at $2.25, then $2… working your way into, by the end of October, a $2.50 or less strangle (hopefully).
