Tag Archives: spy

Where are We Headed? – Chart Updates – $GOOG $AAPL $SPY

Leave a comment

Equity markets around the globe sold off today after the Yen strengthened sending the Nikkei down dramatically after comments from Japanese officials scared investors.  We witnessed the same thing last week only to endure a remarkable recovery into the end of the week.  Was the recovery nothing but a sell-able bounce?  Are stocks poised for a big decline heading into the summer?

Two Fridays ago a late day swoon brought the bears out of hibernation.  The Hindenburg Omen!  Dirigible debris filled the sky.  The end was near, sell everything and head for the hills!  The bull market is over..... yet stocks closed the week higher.  Go figure.

We find ourselves this week in a similar position.  The bears are out of their caves, the fear is palpable, stocks are vulnerable, yet I think we have a good chance to close the week higher than we started.  I'm not sure there are many people saying the same thing.

Below are a few charts for $AAPL, $GOOG, and $SPY.  These chart are my opinion only as are where I think the market and these stocks are headed.

goog611

 

Based upon the last 9 months of trade for $GOOG I think 3 scenarios are possible but feel the most likely scenario is a move over $900.  Late last week I told the chat room that I thought $GOOG was starting to curl after a long consolidation.  That curl upward should lead to new all time highs.  I don't think it happens this week but it will happen within the next few.

aapl611

 

$AAPL remains well positioned for a move to $500, its just a matter of when.  A few months ago I said the same thing about $BIDU with the stock at $84 a share, saying $100+ was coming.  It took a little longer than I thought it would, but it came just the same.  $AAPL the only question, in my mind, is when this move will occur.  The bottom for the year was hit in April.  I think this will hold.  Right now we are looking at a very nice inverted head and shoulders and this will resolve 20% to the upside.

spy6111spy611

 

$SPY in my view has also bottomed for the time being.  We are looking at a possible inverted head and shoulders.  This should resolve with higher prices.  I think $166+ on the $SPY could be hit this week going exactly against what everyone else thinks will happen and putting the few remaining bears out  to bed again.  Good night.

Finally, if someone put a gun to my head and asked where these stocks will close the week, I would calmly answer:   $SPY $165.20, $GOOG 905, and $AAPL $450.

1-2-2013 Watchlist

Leave a comment

 

Like I said Monday, all is well for 2013! The Fiscal Bluff has been averted and the markets are not tanking as most pundits predicted/warned. What a joke the market is. All the big money was away Friday, as retail sold the markets off at the end of the day and in the afterhours on low volume. Then Monday the big money comes back and the market ramps higher all day, even surprising myself somewhat. All the folks betting on fear via the vix and buying puts, were screwed, and are waking up today with a kick in the ‘you know what’

 

As I write this, the futures are up nearly 2% and the SPY is getting close to the Dec 19th high of 145.57 and only a stone throw away from 4 year highs. It would be hard for me to imagine the market ramping even higher today, but anything is possible. I will be a bit wary and will probably stick to my core holdings at the open.

 

I will have a write-up on my top 3 picks for January sometime today. One of them is CALL and I wrote about her last night: https://www.optionmillionaires.com/2013/the-call-to-start-2013/

 

Check out the week ahead with UPB and myself last night : https://www.optionmillionaires.com/forum/showthread.php/206-The-Week-Ahead-with-UPB-and-JImmy-1-1-13?p=387#post387

 

Analysts seem to be back finally after a 5 day hiatus. Here are some of the Up and Downgrades for today:

 

U.S. Steel upgraded to Outperform from Neutral at Credit Suisse

Credit Suisse believes U.S. Steel's earnings are at a trough and that the company will benefit from improving auto sales, a potential recovery in Tubular results, and the Fiscal Cliff resolution. Price target raised to $30 from $20

 

(LNKD)

LinkedIn downgraded to Equal Weight from Overweight at Barclays

Barclays downgraded Linkedin based on valuation. Price target remains $125.

 

Bank of America added to Conviction Buy List at Evercore

Shares are Overweight rated.

 

(BIDU+)

Qihoo search monetization to challenge Baidu, says Citigroup

Citigroup says that on December 31, Qihoo (QIHU) started to place paid links next to its natural search results, indicating the start of the company's search monetizing. Citi thinks Qihoo's monetization could expand its search market share in 2013, presenting possible downside risks to Baidu's (BIDU) dominance. Citi keeps a Sell rating on Biadu with a $95.10 price target.

 

(TRIP+)

TripAdvisor price target raised to $50 from $44 at Stifel Nicolaus

Stifel Nicolaus raised its target on TripAdvisor (TRIP) as the firm believes that recent acquisitions of other travel metasearch sites illustrate the high value of TripAdvisor. The firm believes that the risk posed to TripAdvisor by Google (GOOG) is overblown, and it views Liberty Interactive's (LINTA) decision to increase its stake in TripAdvisor as a vote of confidence in that company which removes the overhang of a potential large sale. The firm maintains a Buy rating on TripAdvisor.

 

 

I am not playing any of those, but may help in your trading today.

 

Here are a few of the strikes I am look at for the open:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
CALL CALL $20.00 JAN 0.45 0.45
MAKO CALL $15.00 JAN 0.20 0.25
MOS CALL $62.50 JAN 0.19 0.25

 

 

Again, you need to be very careful drinking the kool-aid on some of these, as the premiums will probably decline after the open and you will be in the red even when the stock is up. I have a feeling we fade a bit the rest of the day. The market is near the top end, and will need another day or two of consolidation before we head over the 146 area on the SPY. I maybe wrong, but thats what I a playing for.

 

Stocks like SODA, MAKO, and CALL allow you to bank gains irregardless of the overall market, which is why i like them for Jan and the start of 2013.

 

Lets have a great trading day and see you in the chatroom!

 

- Jimmybob

Bull or Bear…. That is The Question

Leave a comment

 

 

To be a bull, or not to be, that is the question:

Whether 'tis Nobler to be a bear,

To take humble possession of puts,

Reveling in the prospects of financial collapse.

Or to take nothing at all,

T0 buy a Call and live valiantly in the light;

Or possess a Put and be scowled upon,

Unsheathe thy sword and duel to the death,

To the winner the spoils of a lifetime,

the loser becomes just that.

 

There are many dumbfounded souls today scratching their heads and saying to themselves "how the %*#@ did we make a new high for the year?"  We are only weeks removed from another escalation in the  European Crisis.  The Euro was supposed to plunge below $1.20 versus the dollar?  WTF happened?  Economic data had been pointing to another U.S. recession.  Bernacke did not give the market the QE it wanted.  Draghi's words ended up being hallow after all.  How the $*%$ did we just make new highs for the year, new multi-year highs, with all this *$&# unresolved?

If trading this market was was easy as watching CNBC everybody would be millionaires.  The market has a habit of inflicting pain upon as many participants as possible and that is what we have had since June 4th, and ultimately since the March 2009 lows.  Those who observed the obvious and positioned themselves for downside were blind sided after the head fake post Draghi.  No one wants to believe that stocks can go up when everything else looks so bad.  When we have growth slowing, the looming "fiscal cliff", high unemployment, stocks should be falling, not hitting new highs for the year.

But here we are.  The question is, will we hit new all time highs.  AAPL just did today, and yesterday, and Friday.  Can we see the rally we've enjoyed since June 4th continue?  Am I a bull or a bear right here?

Some great questions.  Today we saw our first real weakness this month.  Stocks hit their highs and faded, although many stocks were able to hold onto their gains.  We are back in the channel again and while I am a bear at heart ( we are screwed long term) everything is pointing up.  We could see a move back under $140 and still remain in this channel.  I don't think $140 will fall easily, and to get there we need to break $141 on the SPY which will not break easily.

Right here remain extra nimble, trade the intra-day moves (I traded AAPL calls 4x today all trades lasting no more than 10 minutes for profits), and know that this market still has the invisible hand holding it up.  The bias is up, until we break this channel which, absent big event we don't know about, won't happen this month or next month.

 

 

Bull or Bear.... That is The Question.  In reality the answer, for a short term options trader, is both.  The trend is your friend, but intra-day moves can wipe out hard earned profits.

$SPY Needs A Big Push, Could It Be Bonds?

Leave a comment

 

The last three trading sessions have seen the $SPY  break out above $140.  Just weeks ago everyone was calling for the markets to collapse, yet here we are with stocks going on their merry way higher.  Eventually those calling for the markets to decline will be right, even a broken clock is right twice a day, but as I have said over and over and over and over again, the central banks will not let this house of cards collapse, at least not yet.

The SPY remains over the  key  $140 psychological figure.   Stocks are shrugging off bad economic data thinking it will provide the FED with an excuse for more QE.  Dips are being bought, oh my are we already pricing in QE4?   Even my 6 year old knows QE3 is coming in September and Bonds! Oh yes Bonds!   Aside from the government manipulating yields lower to "stimulate" the economy there has been a tremendous flight to bonds.  It has been a double whammy of bond buying which recently sent yields to record lows.

Today the 10 year note sale had its weakest demand in over 3 years. Is this the start of a trend?  Take a look at TLT, an ETF that gives a clear view of  longer dated bonds, which you don't want to be holding when bonds start to sell off.  (The average bond holding for TLT will mature in 27.9 years)   We can already see a potential top.

 

 

TLT is up over 50% in less than 2 years and could be in the early stages of a dramatic decline. If yields start to rise, and bonds sell off, where is this money going to go?  Perhaps junk bonds?  How about high quality, dividend paying stocks, with strong free cash flow?  How about anything that isn't bolted down to the floor of the NYSE?

Hard to believe I am a bear... right?  All this government manipulation will end very, very badly.  If the bond bubble bursts, stocks will rise, and we will see massive inflation down the road.  QE3,4,5 will quickly become QE 15,16,17 as interest rates soar and the Treasury is crippled with enormous interest payments.  But this isn't all coming over the next few months it will take some time.  Right now I am focused on the short term so I can better prepare myself for the bigger picture.  (If you haven't prepared for the upcoming global economic crash than you haven't been watching Doomsday Preppers, your next door neighbor already has!  LMAO!)

$SPY looks ready to retrace some of its gains from earlier this week and late last week.  I have highlighted each time $SPY has hit the upper trendline of the channel.  It pulls back (as it did yesterday) and then tries to make another push for it and fails (as it did today).

 

My outlook?  A pull back/consolidation to no less than $136.80, more likely $137.40, and then a resumption of this rally that will bring us to new highs for the year. There is also the chance we don't pull back and we break right out of this channel.  If that happens we will see new highs for the year within a week or two.  Wild!

This has nothing to do with the economy or earnings and everything to do with bonds.  A rush out of bonds will give stocks their next push higher.