Friday, April 30, 2010

The Biggest Moves Happen When You Least Expect (DNDN)

It is back. The uncertain untamed & market is back, for how long? I have no idea. But while it is here it is imperative for professional traders to take advantage of the "loose" market. When i say take advantage i mean make as much coin as possible while the market permits. Sometimes you only get 1 or 2 days a month of good trading, the rest you must sit on your hands for fear of being chopped to death. I can relate.
Chart is of the VIX, intra day April 30.

The past two weeks we have had Financial's, specifically Goldman in play. Goldman has pending civil charges as well as a criminal probe, this is never good for a stock but is always good for a trader. Not good for a buy and hold long investor, but anyone buying Goldman up here probably doesn't quite know what they are doing and might need a lesson in over bought/oversold and tape reading. I guess this is where i come in, but that is another post. The focus of this post is being ready for anything and being in your seat and able to trade with bullets ready to fire at a moments notice.

Thursday, April 29, 2010

Criminal Probe of Goldman Under Way (GS)

*I am liking what i am reading...This is very preliminary but i do believe a story like this needs time to develop.

Tuesday, April 27, 2010

Is The End Near? You Can Smell The Fire Smoldering (GS)

You might be asking yourself this exact question, but are afraid to shout it out... I believe the tides could be turning for the Financial's, NOT necessarily the entire market. The tone of the our elected officials while grilling Goldman execs hinted at aggravation and intolerance, even the simplest answers from the execs were met with doubt and criticism, this story does not end well. This exact scenario played out in the final months of 2008 (you all know how that ended), *REMEMBER where there is smoke there is fire.

Thursday, April 22, 2010

Goldman Fraud = Buy Buy Buy? (GS)

As everyone should already know, Goldman was charged last Friday with fraud charges relating to sub prime mortgages. I think most people who are familiar with Goldman and their antics were expecting something like this to happen. I for one am not surprised and fully expect other banks to find themselves in a similar situation because everyone on the street played follow the leader. Goldman was the leader and was the smartest guy in the room....

Rumors of CDO Trading Sends ICE and CME shares flying (CME)

Shares of Intercontinental Exchange and CME Group are surging in early afternoon trading on rumors CDO trading will be cleared on their exchanges.  ICE (NYSE: ICE) is currently up 5 points on slightly higher than average volume, CME (NYSE: CME) is up 18 points on similar average volume.

Options are active as speculators come in buying up OTM calls on both ICE and CME. In ICE the 120 May calls saw 2500 traded vs OI of 644. In CME traders focused on the 350 calls as 1500 traded vs open interest of 909.

ICE 52 week range 81.26 - 121.93
CME 52 week range 218.56 - 353.03

Netflix Share Push Through 100 On Heavy Call Buying (NFLX)

Shares of Netflix (NASDAQ: NFLX) are charging higher as it reported positive first quarter results along with a positive forward outlook. Shares rose to an all time high of $102.49 on 8 million shares vs. 1.8 mil average.

Netflix options activity confirms the move, as the May 100 calls saw increased activity as 3k traded vs an open interest of 1.5k. Further out of the money calls also saw increased buying specifically the 110 calls, this prices in a 8 point move before May 21st expiration. June and July calls are also active.

52 week range 36.25 - 102.49

Thursday, April 15, 2010

The ABK Trade.. The Cheapies Will Crush You (ABK)

You might think, oh man this stock is so cheap it can only go up! If you think that you are wrong, you will be crushed. Case and point ABK's trading this week, the junk was up over 100% Tuesday. Yesterday she was up another 50% by late morning. I decided to take a shot with her and dance in the 2.50 calls. I bot them for .75c on a great fill on the bid, i sold .80 .85 and .90. I left a few on in case she went higher, she did not. ABK fell almost 65% in a matter of minutes, almost an hour it took. The options in ABK or any cheapie can move 100's of % in seconds..

Tuesday, April 13, 2010

S&P500 1200 Here We Come? (SPY)

The markets have complacently pushed higher despite seemingly bland economic numbers, April is shaping up to be another grind higher with declining volume the theme. SPY 120 was a number we did not think anyone would see for quite some time, though today we saw, briefly, prints above 120 before the markets retreated ahead of AA's (Alcoa) .

AA missed their sales number though narrowed their loss. The market blipped during during last earning season, only to be bought right back up after the dust settled. ie low volume = buy buy buy.

Elevator Eavesdropping In Chicago or New York City Pays (SPY)

Elevator eavesdropping has been around since the first elevator ride i am sure. One cannot help but overhear what others are saying in the vator... On the morning of September 8, 2008 i overheard in a elevator the following brief conversation.....:

Guy 1: turns and says to guy 2: How is your morning/week been? 
Guy 2: Actually not to bad, i know others in worse shape. 
Guy 1:  That is good to hear, i actually feel the same way. I talked with my buddy over at Lehman and man their issues make mine look like cake.
Guy 3: Yep, have a good one.
I take this all in, i step out onto my floor. I never saw the people again. You know what happened next, Lehman filed BK September 15, 2008. After i heard this i did not think much of it, i just knew something was up because the markets were causing even the oldest and most experienced traders on my floor to get jumpy. Something was indeed up, this conversation helped instill confidence in myself that when we start going down, its not going to stop, it did not till 666.

Thursday, April 8, 2010

So.... The SPY Goes Hard To Borrow On Tuesday.. Market Pukes Wednesday (SPY)

I tweeted Tuesday afternoon the intra day, very odd considering the absolutely ridiculous amount of shares available. Very much collusion must be going on for the shares to become all locked up. What makes this post worth even reading is the price action we saw the following day, where the market fell off very hard following disappointing economic numbers. Shenanigans like this is what makes everyone believe this market is a total crock of shit.

If there are no shares to short and no one wants to sell, the only direction the market can go is up. The heavy selling we saw early in Wednesdays session was clearly real selling though it was not perpetuated by fresh shorts coming in. This is all by design, whomever knew what the economic number was took the liberty to "fix" the market so as the funds sold after the number bottom buyers came and took the market all the way to even before retreating again. This was premeditated market operation, yes market operation is a real phenomenon though this should make it clear to you their are forces outside our control "operating" our markets.

Tuesday, April 6, 2010

Selling Puts On Financials? Worth The Risk.. Not Really (XLF)

This afternoon if you were watching CNBC you heard one of the guests say he believe selling puts on Wells Fargo (NYSE: WFC) and other financials such as Citi is a prudent way to play the upside in this current market. I might say something like that after a few highballs, though i doubt the guest was tipsy.

My guess is he wants to get into puts on the financials at a lower price, this is possible if there is a over supply of sellers across the board.

Monday, April 5, 2010

Trending Up Day, April Off To A Good Start (SPY, AAPL)

Coming off the holiday weekend the market has performed well, much as expected. The march towards 11,000 on the DOW appears intact, the momentum wave is carrying us in my opinion. The catalyst this morning was of course Apple, which released the IPAD on Friday, also a new price target of 300 has been set by Canaccord .

As for the chart on the left, you can see the spy has been finding quite a bit of selling up at 118.80, at the time i drew the chart a triple top was forming, now we have tested the level about 5 times, falling hard to 118.65. To me on a daily the market still looks strong, on a 1 and 5 minute the market feels heavy, she falls quicker and harder then she rises. 120 on the spy is long term resistance, which is the top of the ascending channel which has been forming for months.

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