I covered the SPY short this morning. Not doing any buying just yet. I am waiting for target prices on…
PBR – 30
FXI – 26.50-to-27.00
GOOG – 325-to-335
FCX – 36-to-37.50
Archive for March, 2009
Covered the SPY short
Monday, March 30th, 2009Shorted the SPY
Thursday, March 26th, 2009I shorted the SPY via May 85 Puts to play the consolidation. Basically we are consolidating here as I type this, despite today’s up day, but we need to see the dynamic of the market come in some. We have an overbought condition, and with certain sectors extremely overbought conditions (ie Metals/commodities), and at a very strong resistance point. Basically the probability is high that the pull back we get here will get us off the overbought condition.
I am currently playing the consolidation via the puts, and will mostlikely cover them when/if the SP500 sees around 770
Who is in the Shadows?
Wednesday, March 25th, 2009I would love to know who or what institution is making DNDN’s goal so difficult. I mean an advisory panel of very qualified professionals said Provenge was safe (17-0) and effective (13-4). The FDA ignores 13 yes votes and sides with 4 no votes, and in the process lets countless men die of Prostate Cancer.
So DNDN goes ahead with a much larger study (IMPACT) to basically re-prove what they arleady showed. But now… what a great coincidence that an article bashing the company’s release of info may have compromised the IMPACT study. (article) The extent of the author’s investigating via the company is this… ”Dendreon says its actions were cleared by the FDA but declined to make researchers or executives available to provide further explanation.”
Seriously… seriously. The article is pathetic at best. Where the hell is the investigating? And if Forbes needs a real journalist to write a quality article they can always shoot me an email… however I do no shill work.
I am not invested in DNDN at this time, but anyone reading this blog or knows me for over a year and a half, knows my history with DNDN and why I care about it. (My mother’s and personal friends’ connection to cancer, and the fact that I made-then-lost my first small fortune with this stock.)
Market Thought… i hate meetings
Tuesday, March 24th, 2009Stuck in meetings all f-n day today, and it annoys me to no end. I am a man of few words, especially from 9am-4:30pm… will tell u what you need to know, and all I ask from a person is to not waste my time with bullshit and let me be productive. (because I just want to go back to watch the markets 
) oh-well… sign… now that my bitching is complete… to the markets we go…
The down move today did not really do much to indicate the market consolidated enough. Just looking at the SP500 chart, a real consolidation may lead the market to the 760-770 level again.
A lot of SMA support is going on there, along with a shift toward a more bullish moving average trend led by the 14 SMA.
Upon this consolidation, I will play (barring any meeting interuptions 
GOOG June options (depending on how much it consolidates, but will probably be the 320 or 330 strike), PBR common, JPM common or FAS, and FCX common.
The twist in this plot is the VIX. The set up looks to be one of a break out or a break down. If the VIX breaks down, the markets will typically go up… and via an unbiased eye, it is leanings toward the breakdown.
The markets went down today, so the VIX should have seen an up move to continue its path upward. I was thinking it would reside around 55-60, as the markets consolidate, but obviously that does not appear to be the case. If it breaks down, it would suggest to me the SP500 may move to 850-860 without a consolidation.
Currently, I own my core positions and that is it. I am not betting the market to go down during this consolidation… simply because I was not in front of a computer to time the trade… and now, just waiting for the opportunity to purchase on the consolidation. But if the market continues upward, I am exposed via the core positions.
Market Thought… wow
Monday, March 23rd, 2009Interesting day to say the least (and I could not have called it more perfectly). Anyway, enough of the gloating… the market is currently sending an interesting signal.
The market moved much harder and faster than I would have liked, and we now find ourselves in the thick of the SP500 resistance (between the 62SMA and the negative trend) while being somewhat overbought.
On top of this, we have many individual stocks, particularly the material/commodities/energy/financials/tech (aka the market drivers) being very over bought. They are overbought long-term and short-term, except the financials… the finanicals are not overbought on a longer term level, indicating room to rally.
Back to the bullish view… the SH (sp500 short index) broke any sense of SMA support and looks to want to keep going down. Which means the SP500 may keep going up.
Then, the Nasdaq broke from its negative trend, and SMA resistance.
Typically this is bullish, but I am doubting the fuel the market has to keep going up. In my previous assessment of the market (just prior to the market move), I speculated that our current level is going to provide the first real consolidation, and I have not changed that view. We need a real consolidation here. The SP500 and the Naz has been up 7 out of the last 10 trading days, and they rallied really nicely. (and rightfully so) With a real consolidation the market will be able to run to their 200 SMA.
Palm will be purchased
Saturday, March 21st, 2009Just depends on the price. I noticed that Dell got rejected by the carriers for producing a less than stellar product. (article)
For a company like Dell, with all its cash and intelligence, that is a complete failure. That means they are wasting their resources, and they obviously do not have the right people doing the job. The best way to get the right people is to buy them. The company in the best position to be purchased, with a truly great product in its wings, is PALM.
Palm has $219M cash with about $320M in debt, carrier relationships and the intellectual value worth far more. Because of the Pre, Palm is one of the few companies who are probably underestimating their Goodwill value. If Sun Micro was purchased for about double its market value, I can see Palm being offered double its market value aswell.
We obviously know Dell is interested in the mobile market. If Dell is interested HP is or will be interested. We also know MSFT wants to create a phone aswell.
PALM currently has about a $1B market cap. Is $2B too much to pay for immediate carrier relationships, a very interesting product portfolio and the engineers that created this portfolio? For very cash rich companies, I do not think 2B is much to ask. But I think Palm will be negotiating for more than 2B, and here-in-lies the risk… Palm overshooting their value.
Covered the protection
Friday, March 20th, 2009I closed out of the market protection, via the SPY puts I took on the other day. A limit order was executed on the FXI (purchased). Looking to play GOOG June 310 calls before the close. Looking to get an initial position in FAS at 4.90… will add more at 4.65 or so.
Waiting for FCX and PBR to come in more. I think they will lag the market consolidation, and I am trying not to rush in just yet.
All of these will just be trades.
GOOG… hope u are listening
Friday, March 20th, 2009I usually try not to read articles where people give their opinion as to how to improve a company. Simply because everyone has an opinion, and I do not want to be guided to an opinion… I want to create my own conclusion from various raw data points.
But after reading this article, by seasoned tech journalist Sarah Lacy, I kinda agree with it.
Of course there are assumptions made in the article, like pointing to Twitter as the next big thing, which is very questionable. The very criticism toward Google on Twitter is used to potentially embarrass Google over their purchase of YouTube. Obviously not consistent. And the fact that Google was the next big thing was because multiple aspect came together… ie… broadband allowing for continued surfing, their ability to monitize the increased and faster thinking audience and providing a better product.
For Twitter to work, mobile web speeds have to increase, and the complexities of what is on the mobile screen must facilitate ads. These ads also can not be intrusive to the mobile web experience as well. So has the smartphone market (devices w/larger screens), and mobile speeds, reached a tipping point? If so, GOOG should take advantage. If not, whats the rush. (IMO, I do not think we are their yet, with the exception of the iPhone users. But even at&t’s network IMO is not ‘all there’ yet.) But if I can think of this, I am willing to bet a lot of money that GOOG management already thought of it.
But if you own Google shares it is a very good article to get you thinking as to what Google needs to do to keep innovating and allow their share price to rise.
appologies…
Friday, March 20th, 2009my appologies for not posting the more detailed write up on the market consolidation the other day. things simply got too busy. The case for consolidation still remains. I am looking for the SP500 to see 760-770, or just somewhat of a consolidation in the overbought oscillators I use, before the next leg up. (And I do think we will see another leg up in this market.)
Market Thought… protection trade
Wednesday, March 18th, 2009I purchased a few SPY puts, to protect against a consolidation. The SP500 is at overbought (short-term) conditions, and hitting its 50SMA and approaching hard resistance with the 62SMA and the negative trend line. In order to break these levels of resistance, the market needs to consolidate. A health pull back is in order, or we will have a larger one the higher we go.
I will add to the position as the market approaches the 62SMA. I am still fairly bullish (with this bear market rally), as the actions taken by the Fed are market friendly, and think we break from the negative trend and approach the 200SMA.
A worrisome note: The fact that they are buying 300B in Treasuries concerns me. Infation now is sooo on the table, and the Fed really really has to becareful here. (especially since they said they will do this in the next 6months, and markets typically look out 6-9mths)
Other charts are indicating a consolidation is in order, including multiple individual charts. I will post a more detailed write up later today. This post is an FYI.
