SRS

SRS - I added more to my positions today. MAY20 PUTS and MAY21 PUTS. The options should start to evaporate into next week.

Stock Market Commentary

CLICK ON CHART TO ENLARGE IT

Stock Market Commentary and the $VIX - The long term support of 34-35 on the $VIX has been reached. I think with the S&P close to 900 we will start to drift sideways to lower in the next few weeks. The summer is approaching, and the markets have had a huge run. Typically we have spring highs with a drift lower into summer. I don't think we will see the lows of March, but we could reach a level on the S&P of the low 800's.

My bullish sentiment is now becoming neutral.

Please leave comments on your thoughts.

Happy trading!!!

NDAQ

NDAQ - Closed the other half of the position now (NQDQT) @ 40 cents for a 60% GAIN.

Stock Market Commentary

Well we managed to close above S&P 870. Closed at 873.

When the market reached the high point of the day, 'smart money' took profits driving the markets back down. But as the market came back down to 870, it became resistance. I still take caution here, but lean towards the bullish side.

I will post again tonight with some of my ideas.

XTO

XTO - Closed my position today @ $2.96. I just didn't feel good about the trade.

BREAK EVEN.

See original post: CLICK HERE

Stock Market Commentary

Just a reminder though. Regardless of the Swine Flu news, I will trade this market technically. This is an update to the previous post.

Stock Market Commentary

Here we go again. S&P trying to bang through the 870 level. I think this is an important level. I believe if there wasn't the Swine Flu news, the market would take off higher.

Lets see what happens today.

Stock Market Commentary

Stock Market Commentary - The market keeps pushing at 870 S&P500 (SPY 87). It will be interesting if we push through on the close or not.

Stock Market Commentary

Stock Market Commentary - Looks to me that the market is running out of steam. The SPY is hitting resistance and much of the earnings catalyst that has driven the market up is over. If we don't breakout above the the 87 area, expect a pullback to 82 area.

If the market breaks out, a short covering rally will probably happen driving the market up to 92. If the market rolls over, bears will apply pressure until support at 82 is reached. That would form a higher low and it would be intermediate-term bullish. Either way, I believe the downside risk is relatively contained.


The SPY broke below the trend line a few days ago. Now it is rising to test it as resistance.

I think we should take a cautious approach at this juncture to see if the market rolls over or breaks out.

SHLD

SHLD - Yesterday it looked as if though SHLD was breaking down. Now go take a look at the trend line on the daily. Did it close below it? Nope. That is why we have to wait for a close below the trend for the safer trade. I will still keep my eye open for a potential trade.

See prevoius post: CLICK HERE

SUN

SUN -Closed my position today at the close for $.50

60% GAIN

NDAQ

NDAQ - Closed half of the position @.75. This is the half that I sold for $1.25 2 days ago.

40% GAIN in 2 days.

Still have the other half that I sold @$1.00.

See previous post: CLICK HERE

SHLD

Sears Holding Corp (SHLD) - I am thinking about shorting the stock for a few dollars. It is breaking down. I will keep you posted if I do it.

CNX Earnings

I was very wrong on the earnings analysis for CNX. I am very happy I took profits though.

The right thing to do was to take profits before earnings considering there was not much left in the option price anyways. That is always the right thing to do because it could have went the other way.

CNX

CNX - Earnings Report

CLICK HERE for full report

ENER

ENER - Closed the position EQIQV MAY12.50 PUT @ $.35 for a 56% GAIN.

Solar on fire today. Take my profits.

ANR

ANR - Closed the rest of the position ANRQC MAY15 PUT @.45 for a 57.5% GAIN. I changed my mind from the previous post for holding it through earnings of CNX.

ANR

ANR - Closed 1/3 postion of ANR MAY15 PUTS @$.50 for a 53% GAIN.

Will keep the rest through CNX earnings up to ANR's earnings May 6th.

UPDATE 12:23PM: Stock is higher today because of some buyout rumors.

SRS

Updated

Proshares Ultrashort Real Estate ETF (SRS) - Opened a full position MAY21 PUTS @ $1.25 11:22AM today and MAY20 PUTS @1.10 on APR 24.

CNX

Consol Energy (CNX) - I closed the other half of my position for a 64% GAIN. I don't want to hang out through earnings on this one, especially after NSC report on coal shipments. I am completely out of CNX for now. Bought to close CNXQD @$.30

Norfolk Southern Q1 Earnings Call (37.37 ) -Update : Co says the recession continued to depress transportation demand, volumes were down 20%. Total coal revs fell 9% y/y, intermodal revs fell 25%, merchandise revs down 28%. Looking ahead, co says the auto and housing markets' bottom may be at hand. Co sees growth in scrubber stone, agrifuels, military traffic and waste products; sees weak metallurgical coal demand in U.S. and export markets, lower electricity demand, competition from natural gas. Co sees local domestic intermodal market growth, weak international shipments.

This report could be a tell of CNX earnings report. I have a position in Alpha Natural Resources (ANR) also that I may consider getting out of with a gain. If CNX's report doesn't effect the coal sector too much either way, I will consider writing more May puts for time decay income. I will keep you posted.

CNX

CNX - I will close the other half of my position by tomorrow afternoon. Earnings out on Thursday, Apr 23. I would rather take my gain, than risk it through earnings. I will post once I close the position.

See previous post: CLICK HERE

NDAQ

NDAQ Update - I got filled, sold to open MAY17.50 PUT @ $1.00, on half my position.

Update: Opened the other half of my position MAY17.50 PUT @1.25 on April 21. Now I have a full posistion.

GS

Goldman Sachs(GS) - I covered my shorts for a $3.10 gain.

See original post: CLICK HERE

GE

GE - Expired worthless on Friday April 17th for a 100% GAIN.

See original post: CLICK HERE

NDAQ

NDAQ - Is getting close to support. I will sell to open MAY17.50 PUTS @ $.95 1/2 position. Taking advantage of today's pullback. It could dip more, that's why I am going with 1/2 position.

MDR

MDR - I just bought back the puts on MDR for $.70. Made a 33% GAIN in 2 days. I did this because I think there will be a market pullback and the underlying stock could go down.

XTO

I got filled on the AUG32 PUTS at $3.01. I didn't get filled on the calls yet because the stock has taken off.

EPA News Article from Yahoo! News

I think this news from the EPA could be bad for coal companies and good for natural gas companies in the longer term since NAT GAS is a cleaner energy source. This could also bode well for solar stocks such as ENER.

I don't think it will impact our coal trades now.

CLICK HERE to read the news story.

Yahoo! News

XTO

XTO Energy (XTO) - I always use XTO as a proxy for natural gas. Usually natural gas rises into the summertime. It is breaking out above the 50 period moving average.

I think a good strategy for this play is to sell the AUG32 PUTS and buy the AUG35 CALLS. This trade will only cost you net $1.25 or so per contract. I don't mind owning XTO stock at $32 in a worse case scenario.

I will enter this trade today towards the close. I will keep you updated.

When XTO stock price gets to $39.00, close both positions for a nice gain.

Earnings May 6th.

CNX

CNX - Just a reminder. Earnings April 23. I think after their earnings, we could look for another entry into coal.

CLICK HERE FOR PREVIOUS COMMENT

Stock Market Commentary

For what it's worth, I think the stock market rally will come to an end tomorrow with options expiration. I think Goldman Sachs (GS) usually leads the way and it did not participate in the stock market rally today. It opened at the high and never really rallied. That could be an indicator of things to come. I shorted GS yesterday at $119.56 and am underwater by $1.50. I think it will come around if my prediction is correct.

All of our naked put stock options trades are working. I might close some of our naked put positions if we have a carry through rally tomorrow. I think i will be able to re-enter the same positions again sometime next week at better prices. We'll see.

MDR

McDermott Intl (MDR) - If it drops below $16, bail out or buy MAY15 PUTS.

ENER

Energy Conversion Devices (ENER) - Sold MAY12.50 PUTS @ .80 today. If it drops below $14.46, consider buying puts. Earnings May 7th.

MDR

McDermott Intl (MDR) - Sold MAY15 PUTS (MDRQC) @ $1.05 today. Stock is on an uptrend and there is unusual option activity. This is more of a trend/speculative trade than an income trade.

NDAQ

Nasdaq OMX (NDAQ) Good support at the $18.50 area. When it gets to $18.50, consider selling the MAY15 PUTS (NQDQC) or JUN15 PUTS (NQDRC). Earnings May 7th.

Coal Sector $DJUSCL

With BTU earnings out, the whole coal sector is down. I think this is a good indicator of the next earnings release coming from CNX on April 23. After CNX's earnings, I think the coal sector will have been driven down to good levels to sell some naked puts. I don't think it will matter much what the other coal companies report after CNX's report next week. The coal sector typically rises into the summer each year, so I think selling OTM puts after CNX earnings will be a great move.

CNX

CNX - Closed half of my position at (CNXQD) $.35 today for a 58% GAIN in 7 days. The reason I did that is because Peabody (BTU) another coal company is set to report earnings in the morning. If it is bad, it could bring the whole sector down. Just trying to limit risk.

NBR

Nabors Industries LTD (NBR) - Has a good support area around $10. I think it is breaking out. Looking to sell the MAY10 PUT (NBRQB). Earnings April 21 after market. 5 times the normal call buying volume yesterday and today. Will update when I make the trade.

GE

GE -Sold April 10 puts for $.40 on 4/7

Will let them go worthless next week.

$VIX

Volatility index ($VIX) - Closed below the 200 period daily 4 days in a row (red line) and 50 period as support on the weekly. This should help suck the premium out of the puts we have. Maybe some of the uncertainty is coming out of the markets. We should start expecting less premiums on the puts we sell in the near term future. We will make less premium, but will help our stock support levels because the markets will rise slowly.

HAL

Halliburton Co (HAL) - Has good support in the $15 area. I tried to enter a MAY $14 PUT today and missed. I will see if we get another chance at it today. Keep in mind earnings on April 20th.

ENER AMSC CNX ANR

Scale into your positions as the market goes down. I want to stay way out of the money because of earnings season and a possible downturn to SPX 790-800.

ENER - Still could see a pullback today into tomorrow.

AMSC - Waiting for a pullback to low $17's.

CNX - SOLD TO OPEN MAY 20 PUTS (CNXQD) - $.85 1/2 position. Already have a naked put in another coal company (ANR).

SUN

SOLD TO OPEN MAY 24 PUTS (SUNQK) - $1.25 today at 11:36am. Half position. I will layer in because there could be more downside to the stock.

ENER

Energy Conversion Devices (ENER) Forming a base here with a $12.50 support area. On a pullback to $14 consider selling May $11 or $12.50 puts. Earnings May 7th. Could get volatile so bail before then or buy some protection.

SUN

Sunoco Inc (SUN) This is a great pick from Dad. A good base is forming around $25-$26. Sell May $22.50 or May $24 puts on a little pullback. Earnings April 29th.

ANR

SOLD TO OPEN MAY 15 PUTS (ANRQC)- $1.06 today at 10:51am

Alpha Natural Resources (ANR) has good support around $15. Reached support in late January and early March.