Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
QCOM Thanks for your observations Fabian.
I decided to pass on QCOM and make a different mistake of impatience, buying XHB puts 1 day too early(more than likely). I forgot so wait for the set up of "irrational exuberance" to occur. Something that CR does quite well
in his yin yang trading.
I'm being overly patient perhaps, regarding GFRE. It has come so far so fast that my entry point gets left in the dust.
It troubles you not that it is trading below the 50ma for the first time in a long long while??
I also feel this rally is suspect. The BPs are still not indicating real internal momentum, and the Mc Clellans are beginning to reset. I expect maybe one more day today, say half the magnitude of yesterday or perhaps a gap and crap. But of course I could be totally wrong. Any continuation past today would have me rethinking my position.
In the bull case, another happy day in Asia.
Thanks for your take
CD
RE XHB I may yet recover this error. The last two times it gapped up with a long white candle, it spent the next week to 10 days in decline to well below the gap.
XHB puts idea getting less interesting today[ng]
One thing about XHB many of its larger holdings indirectly reflect the home building market as they are mostly home furnishers, retailers, building supply, etc rather than the builders themselves. BBBY TPX WSM AAN HD
Todays Pending Home Sales came in less than expected.... yet perhaps better than feared...
"By Ken Sweet
FOXBusiness
Pending home sales rose moderately in December, the National Association of Realtors said Tuesday, an improvement from the 16% plunge the market took in November when the homebuyer’s tax credit originally was supposed to expire.
According to the industry group, the pending home sales index rose to 96.6 in December from 95.6 in November. The improvement was slightly less than the improvement economists had forecasted, according to Thomson Reuters.
The more than 16% plunge home buying activity took in November was primarily caused by home buyers who had rushed to meet the original Dec. 1, 2009, deadline for the first-time home-buyers tax credit, pulled out of the market after the deadline came close to expiration.
While the tax credit has been extended through April 30, NAR is not looking for home buying activity to recover until the Spring peak home-shopping season.
“There are easily understood swings in contract activity as buyers respond to a tax credit that was expiring and was then extended and expanded,” said Lawrence Yun, NAR’s chief economist.
The industry group’s indicator is up 10.9% from a year ago.
Pending home sales are contracts signed on an existing property but not yet closed on. A good percentage of pending home sales do not go to completion because prospective homebuyers cannot secure the financing or other factors make a deal fall through.*
Regionally, pending home sales rose by 2.3% in the Northeast, up 14.9% from a year ago. Midwest sales rose 5.2% and remain higher by 8.7% from 2008, while the South saw sales rise 2.2% and remain higher by 5.5% from a year ago. Pending home sales in the West fell 3.8% but remain higher by 18.6%."
*Bold print by me.
Since I think this 2 day move in the market is just blowing off oversold conditions, I'll give it a little more time.
I think there is still a lot of over supply in the housing market, not to mention the issue of foreclosures..
Thanks for your take
CD
RE: "Whachit Short Stuff"
Your sentiment-based call for this sell off was nothing less than spot on and very very timely ...so the caveats for us semi quasi sorta ipso facto maybe "perma bears" are taken quite seriously.
I feel that today's rally will most likely get follow through tomorrow(particularly in the NASDAQ) based on:
1) the McCLellans didn't reset their oversold status at all despite today.
2) both QID and QLD had reversal-type haramis.... for those mystic candle believers (which I follow with moderate enthusiasm compared to the fibonacci's in which I hold much greater confidence..I vote "yes" on the fib debate)
3) Asian markets are happier tonite(at least so far)
4) Down turn is just due for a breather
BUT it does feel as though the trend has changed and the markets are very vulnerable...and maybe I have lots of company in this feeling (hence the reset in sentiment to now "fear" thus bullish??)
In the bear's case: there is always reality..ie. trillion dollar debts etc... and for tomorrow, in the short term, the BP's have NO GREEN despite today.
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=msummary&cmd=show,iday[Y]&disp=SXA
Scroll to the bottom.. past all the lovely green charts of today.
So Fabian, I'm thinking of taking a quick stab at an oversold long for a trade and I'm looking at QCOM, but it occurred to me that in your definition QCOM may have become a "D" stock.
What say you?
TIA and please keep the posts coming. They are greatly helpful, entertaining and informative
CD
In London the subway is referred to as the Underground or sometimes the "Tube". When boarding a car there is a fairly wide gap between the platform and the car. It is a stock phrase for those assisting boarders to caution riders to "mind the gap"
At least it was the 2 times I was there a decade or two ago.
A feeble attempt at humor on my part. Relating to AMZN's October gap. Maybe posters from the UK could confirm my recollection.
Sorry, I know "London underground" sounds like some sinister resistance group engaged in secretive stock trading jargon.[gg]
CD
XHB homebuilders chart relatively weak here..
http://www.heraldsun.com.au/business/new-homes-sales-down-46-per-cent-in-december-says-hia/story-e6frfh4f-1225825434353?from=public_rss
excerpt
"It is clear that momentum is coming out of new home sales as the stimulus from first time buyer related activity recedes.
"We don't as yet, however, have evidence of trade-up buyer and investor activity gathering sufficient momentum to propel us into the second round of a new home building up cycle."
Dr Dale said the recovery in the housing market could be restrained by an expected increase in lending rates during 2010."
In March 15 puts here @ .66
Looking for a return to low 14s maybe even 13.50
Won't hold long if it moves quickly one way or the other.
Speculative bet here. Caveat emptor!
CD
"Set a standard" Agreed Newly... eventually
Though APPL did rather well with itunes in a proprietary mode. But then they got the jump on everyone(save "free" Napster) in compiling a licensed data base for sale.
I believe AMZN probably has a sizable lead in licensed book data base in this case. So if APPL has the preferred hardware and AMZN the software lead, who knows what arranged marriages might occur?
Me, I still like the "pulp" in my pulp fiction and the friction in my vinyl. [g]
CD
Ebooks compatability issues??
"spanked over ebooks?"
I think you nailed it.
http://www.delawareonline.com/article/20100201/BUSINESS/2010314
excerpt
"Apple's creation of a third choice is likely to further frustrate and confuse consumers if they accumulate e-books for one device, then try to go back to read them later on a different one. The effect could be akin to having to buy a new set of CDs every time you get a new stereo system. It could also keep people from buying new e-readers as better models come out if they aren't compatible with the books they already have."
I'm thinking Jan retail sales(reporting later this week) will be disappointing, maybe even for AMZN too. Then there is that huge gap up from October. As they say in the London Underground "mind the gap"
I'd be careful here.
JMHO
UUP hits first target 23.42.
What to do, what to do?
Fear...greed...fear... greed
LOL
cd
The whole market's trading on thin ice right now IMHO.
AMZN had fiscal year 2009 earnings of $2.04. A rule of thumb I like to use is $10 share price to .50 earnings. That translates to a $40 stock based on last year. They have a lot of growth priced in. But who knows, shopping may get a lot easier in the future..just WMT and AMZN to choose from [g].
If I was gonna do anything with AMZN it would be a scalp. I've got the better part of my dry powder committed elsewhere right now.
Good luck
CD
Sorry to have rekindled AMZN nightmares. I too have painful memories with regard to AMZN(betting against them), but I'm repressing them [g]
good trading
cd
Pantera I appreciate your attitude and honesty, and obvious
trading skill. You bring great energy to the board.
Since you are evidently long biased, you might take a look at AMZN. In the midst of a recession and generally disappointing holiday shopping season(for everyone else), they posted absolutely great year over year #s. The initial after hours reaction was down??(They do carry a hefty P/E) but now they are trading at 129 after closing at 126.
If we get a market UP Day tomorrow, they might make a good scalp long.
The McClellans are telling me that we are due for a bounce Friday or Monday. ( But then they have been known to have a Guinness or two.)
FWIW The Bollinger's(Major teetotalers) have a top band for AMZN near 138.
In this current dicey market it would be a Jack be Nimble, Jack be Quick trade.
JMHO for something to look at.
Thanks for the "nice trade" encouragement you generously dish out.
CD
UUP finally broke resistance at 23.20 Still holding March 22 calls. Crazy thing about those calls, they carry virtually NO time premium.
IE: WIth UUP trading at 23.27 the 22 calls are bid at 1.26. You get a lot of leverage "for free".
First target 23.42, then MAYBE 23.88
JMHO
CD
More AIG info
http://www.marketwatch.com/story/federal-probe-is-launched-into-aigs-payouts-2010-01-26?siteid=yhoof
excerpt:
"The U.S. government owns about 80% of AIG as a result of its injection of capital to save the company from collapse in 2008. "
Now from shortsqueeze.com:
"AMERICAN INTL GROUP INC
$ 24.40
AIG
-1.69
Short Interest (Shares Short)
24,435,200
Days To Cover (Short Interest Ratio)
2.6
Short Percent of Float
18.44 %
Short Interest - Prior
26,104,100
Short % Increase / Decrease
-6.39 %
Short Squeeze Ranking™
-2
% From 52-Wk High ($ 55.90 )
-129.10 %
% From 52-Wk Low ($ 6.60 )
72.95 %
% From 200-Day MA ($ 31.92 )
-30.82 %
% From 50-Day MA ($ 29.07 )
-19.14 %
Price % Change (52-Week)
-4.80 %
Shares Float
132,545,728
Total Shares Outstanding
134,607,379
% Owned by Insiders
1.50 %
% Owned by Institutions
25.10 %
Market Cap.
$ 3,284,420,048
Trading Volume - Today
8,519,712
Trading Volume - Average
9,518,900
Trading Volume - Today vs. Average
89.50 %
Earnings Per Share
-467.80
PE Ratio
Record Date
2010-JanA
Sector
Financial
Industry
Property & Casualty Insurance
Exchange
NY
Data Provided Without Warranty"
The bold is mine...Now if 132 million shares of the 134 million shares are the float, and 18% of the float is short, and the US Gov't owns 80% of AIG,...
then... are almost all of the 24 million short shares, those borrowed from private hands or are the USA shares also available to be shorted?
Is the US taxpayer long while virtually everyone else is short?
Just trying to get a handle on this, but to me it doesn't look good for AIG. Any knowledgeable input or corrections very welcome.
CD
AIG I feel it could have a good bit more downside after a bounce. It certainly could have an important "news" event either way.
Some figures from Shortsqeeze.com
Short % of float
AIG 18.44%
GS 1.54%
JPM .77%
BAC 2.90%
WFC 1.12%
A squeeze would certainly add fuel to your long position.
Good Luck
CD
Cashing those AIG puts here for 65% gain. If it was a short(which I can't do), I would set a loose stop and hold on. I feel we are due for a bounce tomorrow. It sure does look like to quote Fabian "sell the rips not short the dips".
CD
MBP
"FXP trades on US hours, so on Friday it fell "
Not to make things any more confusing, but I think you meant FXI fell on Friday
Thanks to all that responded
CD
FXP Overnight all of the Asian exchanges were in the red, yet FXP is down(so far) today.
http://finance.yahoo.com/intlindices?e=asia
Any thoughts on this??
CD
AIG (the original problem) weakness continues- 50ma crossing below 200ma
"Secret" deal with SEC to come to light??
http://www.cnbc.com/id/35020203/site/14081545/for/cnbc/
excerpt:
"The confidential treatment, approved by the SEC, for the redacted portions of the exhibit will last until November 2018.
SEC spokesman John Nester said the SEC granted confidential treatment only after requesting that AIG publicly disclose the list of banks that benefited from the AIG bailout and the amounts of the money each bank received in the deal.
Documents have shown that the SEC allowed AIG to keep confidential the CUSIP, or trading ID, numbers, for each security on which the insurer wrote a CDS contract.
The SEC also permitted AIG to keep confidential the face value of each individual security it insured against default.
Critics contend that without that identifying information, it is difficult to determine which banks among those that benefited from the AIG bailout held the worst performing securities.
In the bailout, all the banks were made whole regardless of how much value each of AIG-insured securities had lost."
Lawmakers ask for review of AIG bailout
http://www.cnbc.com/id/35042839/site/14081545/for/cnbc/
excerpt:
By: The Associated Press | 24 Jan 2010 | 04:53 AM ET
Text Size
"WASHINGTON - Two House lawmakers asked Congress' investigative arm on Thursday to review the Federal Reserve's role in the rescue of the insurer American International Group Inc.
The request came from Rep. Edolphus Towns D-New York, chairman of the House Oversight and Government Reform Committee, which is conducting its own probe into the matter, and from Rep. Elijah Cummings, D-Md., a frequent critic of the $182 billion bailout, which involves taxpayer money.
The two lawmakers want the Government Accountability Office to look into the handling of billions of dollars in payments AIG made to Goldman Sachs Group Inc. and other Wall Street firms it did business with. That's also the focus of the House committee's probe.
Lawmakers, among other things, want to know why AIG fully paid the Wall Street companies, instead of demanding concessions from them.
The panel will hold a hearing on the matter Jan. 27."
Disclosure. Holding AIG puts
CD
There,s that 10300 pivot area again (^_^)
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=43449198
CD
SNV earnings jan28 <eom>
Looking for UUP to finally break r at 23.20 today. As per previous post first target 23.42, then maybe 23.88 or so. Holding March 22 calls.
JMHO
China weighs. FXP looking happier here.
Commercial Re 2 month report
Paper test of 3 ways to be a RE bear
1)SRS long was 9.39 now 7.41 (down 21%)
2)-ZWMMQ (IYR leaps put) was 9.05 now 5.25bid (down 42%)
3)URE short was 5.78 now 6.96 (17% loss to cover)
no dividend was paid last Q on URE
if nominal 7.25 per annum interest is charged for the short it would result in an addition 7cent loss or 7.03 (18% loss to cover)
Once again the least worse method is the URE short.
CD
Out SNV @ 2.61(from 2.12) near the close. Want to revisit it(most likely) for the run to 2.97-3.00 after the pause that refreshes.
Thanks again for SNV Joe
CD
Working on the RE test trade. Looks like URE posted no dividend in Dec 09 for the first time.
http://www.proshares.com/funds/ure_distributions.html
Will post results later.
CD
RWC getting frisky <eom>
UUP Testing R at 23.20. If it makes it through my take is next pause at 23.42 then 23.88(pinging off of Dec low last year and in close proximity to the minimum fib, retracement).
Look at the volume in recent weeks. Shorts could be piling on their covers if it breaks R.
JMHO
CD
Why should the dollar rally? Why should IYR go up? <grin>
Hi Lee What is the commish for a futures round trip? Is it similar to stock trades?
TIA
CD
Gap fill on UUP today at 23.20. Feels like they are fighting hard to keep a lid on the dollar.
CD
ADY April 22.50 calls 2.05 bid If in @21 downside protection to 19, If called 22.50 + 2.05prem, gain of 3.55 on a 21 investment in 4 months.
CC candidate?
Wondering why the big dip on Nov 16th when they beat estimates??
CD
Edit Revised estimates downward reason for drop. Not that this applies to ADY, but also wasn't there an issue with infant formula contamination from Chinese producers in the last year or so??
Dow 30 joining the OEX BPs in Bearland
http://stockcharts.com/webcgi/Pnf.asp?S=$BPINDU
Now, to be fair, what this really says is that only 78% of the top 100 S&P market cap stocks (OEX big boyz) and 80% of the 30 DOW(formerly) industrials currently have "bullish" P&F charts. (Having come down from even higher levels and thus presenting a reversal or roll over).
Just an initial warning shot which could be negated...but not to be totally ignored imho.
CD
Hi Zuch
I was going to try an entry around 2.10 (might have to pay a premium). Will see how it behaves today. If it makes it thru 2.50 next target on my read is around 2.97-3.00.
JMHO
CD
EDIT In at 2.12
Totally agree with your take on SNV chart. I traded in and out(thank you Joe) and am looking to get back in. Love the ping off of 2.49. Behaving perfectly.
Hope I have not jinxed it.
CD
Thanks Kozak Nice find.
I'm going to have to assign some borrowing cost to the short URE position in the test. It is evidently quite complicated and variable to a given broker and their policies. For now, I think charging an (averaged) and not totally exact monthly interest will not distort the relative merits of the of the three methods of playing the RE downside.
CD
Thanks Taxmantoo.
I'm just going to assign an average annual rate of 7.25% or so for the purpose of the paper trade test. Your post makes me wonder how they handle a daytrader who shorts and then covers 10 min. later? Must be some kind of minimum charge I would guess.
CD
Thanks Joe
So to be fair, next month I'll include 2 months borrowing costs to URE results. I'll use 7.25 per annum as an average.
CD
I originally had borrowing costs as the other caveat along with divies but I wasn't sure whether broker interest charges would be consistent across different brokers or if it would be more than an insignificant cost. I trade in an IRA so I can't short except through inverse ETFs or Puts.
Thanks for noticing the omission.
What interest does IB charge for shorts?
CD
Commercial RE 1st month results..
3 ways to profit(lose) from weakness in CRE (paper test trade)
SRS long was 9.39 now 8.34 11% loss
-ZWMMQ(IYR leaps put) was 9.05 now 7.35 19% loss
URE short was 5.78 now 6.25 8% loss
**First months winner URE short**
Other factors..dividends..
URE has been paying a regular quarterly dividend around .03 to .05 cents and one should be due this month. That would have to be paid by the shorter and work(slightly) to the detriment of the URE short.
_ZWMMQ is tied solely to the price of the underlying vs the strike price and dividends would have no impact.. except that leaps put options tend to have a higher premium than the equivalent leaps calls when the underlying pays a dividend(thus any dividend related pain was front loaded)
SRS long has not paid a dividend since Dec 2008 when it issued a whopping 4.59 divie. Any dividend here of course would be helpful to the SRS long.
Will report again next month
CD
Nice one, Cash, 19 million in revenue last year and a five year contract 150 million per.
Fits the profile
Thanks
CD
IN EDIT Release doesn't say how big RWC's slice will be of that 750 million over 5 year pie.
KERX
Alas, I wish I had gotten in in June at 90 cents or so but I'm in from OCT 8 at 2.27 during a volume spike( based on good research results).
I was planning on it being a day/swing trade. What I do is check the top 10 percentage gainers looking for ...
1) A large single(1st day) volume spike
2) A compelling story (ie cancer treatment success)
3) Enough volatility to enter during a pullback(usually based on 1 minute CCI and intraday fib. retracement. Also 5 min RSI and support/resistance an a 60 minute chart( a Zeev method).
Then I rely on "Johnnie come lately" theory for an exit usually the next day( or late in the first day). The theory being that a compelling "story stock" event gets written up in press, talked about by brokers, blogged, etc and there is often follow thru by latecomers the next day. This has worked pretty well over the short time I have used it. (You have to use stops and avoid the crazy parabolic runaways).
In the case of KERX, after DD, I thought I might be onto something long term. They have very good scientific results, they are a bio that showed(sacre bleu) a profit this year and their chart is very pretty.
They are however, very small, some of their treatments have "orphan status" meaning they are supported by government grants because the number of patients involved is small in the case of rare diseases and they are more researched based rather than product delivery.
They do have "Perifosine" treatments, which I believe could be big. (JMHAO)
Because they are small with very promising science I also suspect someone may like to acquire them. :)
I'm by no means a bio expert, and these type stocks often spike and pull back(I'm guessing to at least 2.80 or so on my chart read) so so your own DD and be at the mercy of your own decisions(caveats etc etc)
Good Trading, I enjoy your posts very much.
CD
Well jeez Fabian... Your persistence in encouraging us often bearish leaning types to join the buy and hold cult is admirable. I'm joining you in your stodgy Chinese bromine producer at the first good entry point I can determine. And for good measure, I'm walking over to our hot tub and tossing another bromtab or two into the floater right now.
Perhaps "stodgy" is a little unfair to a stock with a northeast bound chart like that, but just not "sexy" you know. You want "sexy" take a look at a weekly chart on my cute little biopharm making a new 52 week high today.
KERX
All in good fun and really I'm going to buy GFRE. Sometimes ya gotta be dragged to the profit table.
Thanks
CD