November 19th, 2007 at 9:25 am | Permalink edit copy
AAPL – yes be very careful of short-term positions and consider selling a shorter call if it funds a roll for you to move back a few months in time.
November 19th, 2007 at 9:32 am | Permalink edit copy
New $10K positions – LOL, it’s not like I just dump a ton of positions down at one time! We take a position when the opportunity presents itself and right now the safest thing to do is wait a bit and see how dire things really are (not too dire I think).
C Dec $35s for $1 XXX mo play, stop at .85, look for $1.20+
November 19th, 2007 at 9:39 am | Permalink edit copy
MDT – yes, I like to take on risk early on as a quick win at the beginning means I can have much more fun for the month. A quick loss will just force me to follow a fairly conservative pattern I would establish anyway.
GOOG with a power move, if they break $640 the market could turn. AAPL is unsinkable.
November 19th, 2007 at 9:43 am | Permalink edit copy
Yes, $10KP plays have $10KP in the same line! (not C and we don’t do mo plays in the $10KP). Any $10KP position is fine for the $25KP (in case I forget) but not vice versa.
C – I changed my mind and I’m going to DD at .80 and set the stop at .70 as I think this price is a gift. XXX
November 19th, 2007 at 9:44 am | Permalink edit copy
ERTS is a cheap way to play GME earnings with the Jan $60s at $2.15 XXX
November 19th, 2007 at 10:00 am | Permalink edit copy
There are lots of no brainer rolls you can do like I just rolled some FSLR Dec $180s to the Jan $190s for free, obviously 1 month in time is worth $10 on that stock. Think about that when reviewing your positions in general…
I’m stopping out of my DIA Dec $135 puts here as they are way up. The $133 puts (much heavier position) will probably stay for the duration and get rolled up as needed. If we go down, I’ll be buying the $130 puts, now $3 as I can get almost 2x for each $135 put.
OK – who’s buying all the FROs?
TASR – don’t be cheap and get the ‘10 $15s for $4.85 you can sell 3/4 Jan $17.50s for .40 and it won’t take you long to pay off your position like that. XXX
MDT – yes it’s an earnings play. I feel strongly that they are oversold due to their recall so we’ll see at the conference call if my Fundymentals are working or not. Don’t get me wrong, this is a big risk so don’t play if you are the worried type but I’m willing to risk 10% of a $10KP on the chance I’ll have a $12KP tomorrow which will let me play conservative with $9K and gamble with $3K. If I lose, I’ll play conservative with $9K and, if I wasn’t willing to take a chance, I’d be playing conservative with $10K – see how that works?
STX – always good and they have nice premiums now due to crazy volatility. I like the June $27.50s at $3.30 selling 3/4 the Dec $27.50s for no less than $2 but giving them a chance to do better.
Sellers just jumped in though so be careful. Financials falling and buying really dried up quick.
November 19th, 2007 at 10:34 am | Permalink edit copy
Would someone remind me to ALWAYS buy CME on expiration day. I’d say 4 out of 5 times that pays off.
FDX – you have to aknowledge that the market may actually fall apart in which case we have a very long way to go down. It’s 5:1 decliners over advancers right now, either cover or cash is the only sensible way to go.
Gold – I do still like gold if it all hits the fan but really cash and cover if we drop another 100 points is the only sensible plan.
November 19th, 2007 at 10:46 am | Permalink edit copy
SHLD – I think on Friday or Thursday I said it is irrational to hold SHLD without covers, I have to stand by that one…
C – I’d be happy to get even now (in for a .90 basis after DD, hoping we find some kind of bottom)
November 19th, 2007 at 11:16 am | Permalink edit copy
Well it’s ugly but we’re holding for now. Let’s watch, of course, 13,000 but Nas 2,675 is more important ans S&P 1,430 is still pretty safe.
XLEs are covered with Dec $73s
SHLD — I know, I regretted it at 9:31! That gets filed under do as I say, not as I do. I bought out my caller and got all excited by the rise on Friday, could have been so happy if I sold at Friday’s close.
MSFT – we’ll get a chance to see what’s strong here but that sure doesn’t mean I want to jump in and buy. We’re going to have to wait out the week and see if nothing blows up by next Monday before we get an all clear. Starting a 3-day week (Friday is a BS day) with a down 200 day is NOT a buy signal.
SHLD just made 52-week low!
AAPL covered play. I thought we did that but remind me later.
November 19th, 2007 at 11:22 am | Permalink edit copy
This is gut check time for traders guys. Now is the time to take out caller that you’ve gotten a quick 30% from and take a chance before you roll down and sell the next level. This is my range so I’m taking out pretty much anyone I have a good advantage over with 20% (of the profit) upside stops so if I have, for example, my SHLD Dec $125 caller (SHLD was 1/2 covered) where I’m up $3 on him at $4.20, I set a stop on him at $4.80 which runs down with his price and he comes off the table on a reverse.
If it’s a head fake, the fact that I suddenly see a naked SHLD Jan $130 is a signal to me that it’s time to roll that position down anyway (or give up, depending on my feeling at the time). As it stands, the caller has that 1/2 of the trade 100% covered so I’m not worried but that’s no reason not to take him out.
MSFT $37.50 caller is down to .15 (down $1.15) while my Apr $35s are still $2.20 (down .40) so of course I’m going to offer a dime for him and stop him out at .20.
That’s they way you have to play a drop like this as this is your BEST opportunity to make money IF it turns and, if it doesn’t – just get back to cash and be patient.
November 19th, 2007 at 11:27 am | Permalink edit copy
Eddie – I just bought crazy amounts of C so I agree with him. I just can’t bring myself to sell them at this price, it’s crazy! The pull in $150Bn in sales and $22Bn in income a year and while write-downs would suck, they’ll still be in business next year and the year after that, which is more than I can say for the 1,000 little banks they will be able to buy out cheap if things really go to hell. All C has to do is issue a denial and they shoot right back up and the reason GS picked on them is because they don’t have a CEO so it will take them a while to put a statement together. GS gets more mileage out of trashing C than they would out of a bank that could quickly respond, that’s what this is all about.
November 19th, 2007 at 11:45 am | Permalink edit copy
AXP Jan $57.50s for $3.40 are a nice retail gamble.
I’m having a hard time filling calls – that’s a good sign I would think!
November 19th, 2007 at 12:05 pm | Permalink edit copy
Will week end positively – I think we are rangebound for quite a while so anything between 13,000 and 13,300 is “positive” for me as that’s the channel I’m playing. Usually a channel isn’t this violent and I can’t believe how many things I took off the table just 1 day after I thought I had made enough adjustments but I have an investing theory and I’m sticking to it until I’m proven wrong.
November 19th, 2007 at 12:22 pm | Permalink edit copy
IMCL – when a bio doesn’t perform it’s not good to throw money at it as there may be something going on that isn’t public knowledge. I love IMCL and we just went DD on it last week but the whole trade is down 20% and I’ll be excited to get 1/2 out with $5.15 on the $40s so I can go back to my original position with a lowered basis.
I’m not doing too much rolling right now, mainly taking out callers per above note and hoping for a bounce. If I take out a caller and the stock goes lower, at least my roll becomes cheaper…
FXI – I still wouldn’t short China, you can’t trust information that comes from there as they could teach NYMEX traders a thing or two about manipulating the markets (remember how they assisinated the dollar a couple of weeks ago?). Those regs were being phased in at the banks since 10/31, it’s only our dopey press that just catches on to it today (not coincidentally the same day GS dumps on the market in general).
BA – I will keep buying BA all the way down to $50!
November 19th, 2007 at 12:37 pm | Permalink edit copy
There’s a major effort underway to take this market lower – if oil falls apart and turns negative, that will trash energy, then commodities, then financials and we could get another leg down so let’s hope XLE and OIH hold up here ($72 and $180).
TGT can kill us with bad earnings. HPQ too risky but I think they’ll do OK as laptop sales are through the roof.
November 19th, 2007 at 12:56 pm | Permalink edit copy
$25KP adjustments:
AAPL – Selling $175 calls for $6.25 and rolling Jan $170s to Apr $170s for + $9 (net about $3)
CAKE – Selling Dec $22.50s for .90, rolling to Apr $22.50s for $1 (net -.10)
MSFT – rolling to 2x Jan $35s at $1.20 (net credit $1.20) selling 1x Dec $35s(10 of 20 new calls) for .75
PFE – rolling to Mar $22.50s for $1.
SHLD – roll to Mar $120s for $3.70, selling $125s for $3.25.
Big push down again but I see buyers at 12,780, if they give up we’re in trouble!
November 19th, 2007 at 1:04 pm | Permalink edit copy
Why buy a call out – because if I sell a call on Friday for $3 and it’s $1.5 today I made 50% in one day. If I wait 30 more days I’ll make $1.50 more, hardly an improvement in daily revenues. If I’m lucky enough to time it right (and so far I’m not) then I sell them again for more money on the bounce. If I’m wrong, then it’s time to roll down and sell lower level calls anyway.
UBS – looks like we got the target right so far.
AAPL – $164 is not falling apart. You guys are so spoiled by this up market. Shockingly, stocks go down as well as up and you need days like this to get rid of the people who made a profit, get them back to cash so they can start buying other things. The real trick is figuring out where they’re going.
November 19th, 2007 at 1:13 pm | Permalink edit copy
Russell at August lows! S&P still 25 points above them.
$25KP yes on 10 MDT $47.50s but not looking so good right now. Big sell program hitting here, very nasty.
November 19th, 2007 at 1:22 pm | Permalink edit copy
MDT sell off – sentiment is way down so it’s unlikely anything but great earnings will get a good reception.
SHLD – ask me later, way too much going on right now.
I’m still holding bullish at the moment but getting a little worried. 1,430 or at least 1,425 needs to hold but GOOG is damn scary under $620. They did flush out the buyers at the 13,000 level and now they’re trying to race us down to 12,900 before anyone can have a meeting about what to buy but I’m betting it will be the usual suspects so let’s watch AAPL ($165), GOOG ($620), GS ($220) and SHLD ($120) for signs of a bottom, otherwise it’s time to think about DIA $128 puts if they hit $3 (taking off the top layer of course).
November 19th, 2007 at 1:25 pm | Permalink edit copy
Mattress plays – and, if you’ve gotten too bearish, the $131s are getting attractuve at $2.95!
JOSB getting very cheap.
November 19th, 2007 at 1:31 pm | Permalink edit copy
OIH is certifiable with a $7.20 price on the $180 calls! I’m not usually a fan of Bull calls but you can buy the $170s for $13.47 and sell the $180s for $7.40 for a net $6.20 on the $10 spread. OIH hasn’t closed at $176.20 (break even) since August and you can always roll down if things looked bad. XXX
November 19th, 2007 at 1:37 pm | Permalink edit copy
Damn that was nerver wracking! We really need to take back some levels now… Dow 13,000 of course, S&P 1,430, Nas 2,600, Rus 750, NYSE 9,500 is pathetic but we’ll take it, SOX 420. Anything less and we’d better be a little bearish into the close but that was it for that massive sell prog and, if there’s not another one lurking, we could get away with some bargain hunting here.
ISRG holding up today.
November 19th, 2007 at 1:47 pm | Permalink edit copy
Jan index calls – I’d say whatever DIAs are trading at $4 would be about right and any time you can roll down for .40 or less, do that.
Don’t forget Fed minutes tomorrow. When they want an excuse to reverse the markets, that’s what they like to use.
BSC at 52-week low.
November 19th, 2007 at 1:48 pm | Permalink edit copy
FRO – glad I got in this morning, that thing went nuts today and I didn’t even publish that trade on the free site.
November 19th, 2007 at 1:58 pm | Permalink edit copy
Yet another huge round of selling flying in but buyers are hitting some (not the financials which look awful!). As I said before, Oil isn’t holding it together and that’s dropping energy with the financials following so game on with the DIA $128 puts! XXX
November 19th, 2007 at 2:09 pm | Permalink edit copy
$25KP is not new, $10KP is but the plays for the $25KP are still geared towards around that level of cash. I can’t start a new virtual portfolio every month, that would drive me nuts! This $25KP runs through December expiration and the $10KP runs until it’s better than doubled (enough to move to the $25KP).
AppleFly round 3 – buying 5 $180s for $4.35 in $25KP and 2 on the $10KP XXX
November 19th, 2007 at 2:13 pm | Permalink edit copy
Next step in Applefly is to sell the $165s for $12 or better and buy the $150 puts for $5 or less followed by selling the $165 puts for $12 or better.
For existing $180 calls, roll them down to the $175 calls for $1.45, this cuts $5 off the margin requirement and limits upside payout. XXX
November 19th, 2007 at 2:27 pm | Permalink edit copy
C finally coming off the mats, GOOG perking up, GS, AAPL coming back – hopefully this one will hold.
Last minute oil pump turned NYMEX positive (how could we ever have doubted them?) and turned energy around, saving financials…
ISRG – nah, it’s well ahead and held up strong.
ICE new ATH.
$25KP moves:
Take out GOOG $680s at $12
Take out LVS $115s at $6.50
Take out NFLX $27.50s at .15
November 19th, 2007 at 2:32 pm | Permalink edit copy
Ah see, buying that extra set of DIA puts works every time to set a floor! Probably the fact that we do it as a group freaks people out…
November 19th, 2007 at 2:48 pm | Permalink edit copy
This is more a lack of selling than conviction buying so don’t get too excited about this…
November 19th, 2007 at 2:53 pm | Permalink edit copy
ISRG – thanks, it’s different when you’re in an ‘09 as you can afford to play buy and hold (more so than someone who actually has the stock in fact) so we can wait and see if $270 holds as a floor because we can always roll down and sell. At this point, I’m willing to sell the $320s for $8 as that’s plenty of room to run and it pays for $8 of $9 to roll to the $280s XXX
November 19th, 2007 at 3:03 pm | Permalink edit copy
Applefly – yes, whatever you opened with you want to match it on the turns. If you don’t get your 2nd position and it dumps back to even on you, you should get out of the call as it does you no good to lose money on a naked call. It’s like fishing, you have to throw a lot back before you get a catch. Also remember, if you make $1 on your entry before you cover, you can just sell and pocket the dollar and start the leg when it comes around the other way. If you make $1 doing that 5 times, that’s more money than you were likely to make if you had completed the spread!
UNH doing well. My SCIs as usual bucking the trend, PEP having a good day,
Damn, down we go again!
November 19th, 2007 at 3:49 pm | Permalink edit copy
Applefly – as I’m advising $25KP positions I can’t expect people to be able to sell naked puts so we do it the hard way but, if you have the margin for it, that is the better way to go. Of course you also have to set tight stops as you have 2 bets in one direction! Also, by the way for Applefly players – we don’t actually expect to complete legs the same day, that’s just the nuttiness of this market that’s made it possible. Back in the good old days (2006) sometimes a stock like Apple would take a whole week to move $5. No really! It’s true, look it up… 
$10KP – sure, if we can complete both outside legs it’s worth the risk for a couple of days. Right now I see the spread at $4.25/$9.90 on the puts side ($5.55) and $4.65/$10.60 on the call side ($5.95) which is actually a good spread right there ($12.50 with $2.50 at risk – over $177.50 and under $152.50) and would not be so terrible to fill but we are looking for less than $1 risk. I suppose filling either sell at $11 would be great.
Primus – don’t be greedy. The plan is to sell the calls for $12 so if you’re out, put in the order. Sometimes it hits the price for 10 seconds only.
Bad finish…
November 19th, 2007 at 3:52 pm | Permalink edit copy
This was actually a nice bottoming move today. I would have preferred to have held 13,000 but it’s all up to the earners now.
