Security Traders

Strong earnings but stocks weaken

2010-04-22T00:33:45Z

After the bell on Tuesday, traders digested another round of positive earnings; even more importantly, impressive revenues. However, the excitement quickly faded and by the time the cash market opened the bias was to the downside in broad market indices.

iPhone sales helped Apple to blow by analysts' earnings estimates and Yahoo reported an EPS of about double expectations. Likewise, Morgan Stanley announced that the company earned $1.03 per share in the first quarter.

As good as the earnings news has been, it wasn't enough to keep the unrelenting rally moving higher. Some analysts warned that investors are growing to expect gangbuster numbers and this alone could be an antagonist against future gains.

Banking stocks tumbled on news of strengthening momentum of a proposed tax on banks intended to raise $90 billion over the next decade. President Obama introduced the idea in January but it appears as though the odds favor it being added to a bill overhauling financial regulation.

From a technical standpoint, today's failure of the S&P to make new highs is relatively bearish. On the other hand, I don't trust this market. We side with the bear camp, be sure to get good entry prices or it could be a painful venture.

Resistance in the S&P lies at 1216ish, in the NASDAQ it will be 2048, and 730 in the Russell.

Don't forget about our webinar with SFO Magazine on April 29th, you can sign up for free on our website (below).

* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version

S&P 500 Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading

Position Trade -

February 19 - Our clients were advised to sell the April 1165 calls for about $7.50, fills were coming in near $7.25 and a handful at $7.50.

March 5 - Clients with ample margin and guts, were recommended to add to this position by selling the 1165 calls for $9.50.

March16 - Clients were advised to roll half of their short call position into the April 1185/1100 strangle.

March 17 - Clients were advised to roll the remaining 1165 calls into the May 1190 calls to give the market some breathing room.

March 31 - Clients were advised to buy back the short 1100 puts for $1.75 in premium

April 1 - Clients were recommended to roll any existing April 1185 calls into the May 1215 calls for a small credit (about .50). This moves the risk away from the market and lowers the delta considerably.

April 13 - Clients were recommended to sell the May 1135 puts for $8. This move lowers the overall delta of the trade while keeping the position in the May options in hopes of favorable time value erosion. It is only a Band-Aid, but will temporarily stop the bleeding.

April 15 - Clients were recommended to buy back the May 1190 calls, and in some cases the 1200 calls and sell the May 1220/1150 call spread.

Russell Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

March 9 - Sell 1 June mini Russell @ 682 OB

Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

March 3 - Sell 1 e-mini NASDAQ at 1878 or better

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

http://www.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Double Top for Stocks or Double Trouble?

2010-03-06T01:03:48Z

The drawback of writing a newsletter with relatively strong opinions in market direction is the substantial risk of being wrong...or in this case just early (we think). Unfortunately, our crystal ball was a bit cloudy earlier this week. We were right about the rally, but didn't anticipate it moving quite this far.

Our 1125 objective in the S&P has come and gone and while we still feel like the market will see a reversal sooner rather than later, we cannot overlook the possibility of a retest of the January highs. This would put the S&P just under 1150...or even moderately higher. The Russell on the other hand, has already surpassed its recent highs and is now trading in territory not seen since late 2008.

There are very valid arguments for the bear camp that are being overlooked (or over run) by this rally, but sometimes fundamentals simply don't matter. The market is panicked...shorts are panicking and being squeezed out and the last of the sidelined cash is panicking to get in.

The employment numbers weren't positive, but their implications were. They jobs picture is bad enough to prevent Fed rate hikes but it isn't bad enough for investors to recall the possibility of a double dip recession. Nonetheless, some analysts are vocalizing the opposite. "Eight months into the much-touted recovery, the economy should be adding jobs not just losing jobs at a slower pace," noted Peter Morici, an economist for the University of Maryland.

There is some resistance in the S&P near 1138 but 1148 seems very possible target before a reversal can occur. The NASDAQ is facing resistance near 1900, and in the Russell this equates to about 669.

* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

February 19 - Our clients were advised to sell the April 1165 calls for about $7.50, fills were coming in near $7.25 and a handful at $7.50.

March 5 - Clients with ample margin and guts, were recommended to add to this position by selling the 1165 calls for $9.50.

Russell Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

March 3 - Sell 1 e-mini NASDAQ at 1878 or better

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

www.DeCarleyTrading.com
www.ATradersFirstBookonCommodities.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Panic Selling in Equities Followed by Panicked Buying

2010-02-06T16:23:09Z

After melting through 10,000 with ease, the Dow clawed back on the close to settle slightly above. The March Dow futures contract failed to reach the milestone but it is clear that there will be no free lunches for the bears.

There are no shortages of hedge fund blowups and many believe that it was the liquidation of leveraged commodity and stock positions that enabled such a dramatic fall from grace. At one point today, the S&P was approximately 60 points off of yesterday's highs. We haven't gotten to the capitulation seen in 2008 fueled by fund and small speculator margin calls and the subsequent liquidation but this has certainly been a reminder that complacency has no place in these markets.

Market psychology has changed, most traders have adopted a "sell rally" policy but that doesn't mean that the market will go straight down. In fact, there were rumors of a large and well known bank buying a total of 600 S&P futures late on Friday. Assuming a value of 1050 in the March contract, that is about $262,500 per contract...I'll let you do the math.

In the January issue of Futures Magazine, we were quoted several times in reference to our opinion of "Hot Markets of 2010". In the article we predicted a large upside breakout in the U.S. dollar early in the year and later noted that such a move would put pressure on the metals and grains. In this newsletter, we have mentioned several times that a stronger dollar would be trouble for domestic stock indices. Unfortunately, we don't always follow our own advice...If you are following our short put option recommendation, we are growing slightly anxious but are not yet uncomfortable. Despite spikes in volatility and put premium, we feel as though a relatively large bounce is looming and this will be just what we need to exit the position favorably. Luckily, as an option seller your timing and price speculation doesn't have to be perfect!

Our weekly chart is pointing to 1020 in the S&P, but we think higher before lower. The last time around, the rally fell short of our targets...we will see how things pan out this time. We are looking for a rebound in the S&P to 1085 and possibly even a bit over 1100 if the news is supportive. If you are trading the Russell, similar levels are 604 and 615 and in the NASDAQ at 1773 and 1810.

On a lighter note... http://www.cnbc.com/id/15840232/?video=1405435640&play=1

*Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

January 21 - Our clients were advised to sell the March S&P 1000 puts today following the drop in an attempt to capture the market volatility in the put premium. Fills were coming in from $8 to $9.

Russell Futures and Options Trading Recommendations

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

January 27 - Buy 1 e-mini NASDAQ near 1781
· February 3 - Place an order to exit this trade at 1830 OB

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Stocks stall, but the rally might have a little left in it

2010-01-06T14:09:35Z

The major indices flat-lined in the midst of lousy housing data and ahead of a calendar chock full of risk. Traders are focused on the jobs numbers because that, along with housing, has been the anchor on the recovery. We will get a glimpse of the employment picture with tomorrow's ADP numbers but the real deal will be Friday morning. I can't help but feel as though even good numbers will have a hard time keeping the market afloat. It has been a nice run, but a correction seems to be in the cards.

Pending home sales numbers were horrible (down 16%) and the carmakers reported sales declines in 2009. It was the worst year for the auto industry (and taxpayers) in nearly 30 years. Ironically, each of the three U.S. auto leaders claim that they have momentum going into 2010...cash for clunkers 2?

The dollar was essentially unchanged, but our charts are telling us that the greenback could hold support near 77.40. If this turns out to be accurate, we feel as though the buck will make a move toward 80 and this will put pressure on the equity rally.

Seasonals and technicals are all "calling" for a top. We think that the S&P will run out of steam near 1140ish (maybe as high as 1150) but are becoming bearish. Similarly, the NASDAQ could see 1900 or a little above, but we like the short side of the market. Be a wise bear...don't go all in! A little something is better than all of nothing.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Russell Futures and Options Trading Recommendations

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

December 28 - Sell 1 mini NASDAQ near 1879

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

www.CarleyGarnerTrading.com
www.DeCarleyTrading.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

The Beginning of a Squeeze?

2009-12-10T23:05:45Z

A narrowing trade deficit helped stocks forge gains in light volume trading. According to the Commerce Department, a large surge in exports (likely due to a cheap dollar) helped narrow the trade deficit in October to $32.9 billion. However, isn't this why the stock market has been rallying anyway?

Like it or not, the market is probably going higher from here. I doubt that the buying pressure will come from fresh bulls, but the shorts caught on the wrong side (again) might start to feel the squeeze. That said...I wouldn't be the farm on any trade or speculation. From my conversations with others in the industry, many have already opted to take the rest of the year off. December markets can be dangerous and for those that have had a good year, it doesn't make sense to take on unnecessary risk.
If you like a lottery ticket play, we still like our idea from yesterday:

I am normally not one to recommend option buying, but if you are the type that can't stand being on the sidelines...this might be an opportune time to be long options. The sideways action has eroded premium on both sides but we like the idea of buying the December 1115 calls for about $5 in premium. It is a lottery ticket, but if the shorts are squeezed hard enough it could pay off well.

The lack of news and market action has left us with little to talk about. We are sticking with the same calls:

We see near-term support in the S&P near 1082 then again at 1076, as long as these levels hold there is a chance for a Santa Claus rally. That said, the markets seem vulnerable to a large correction but we think that will come in early 2010. NASDAQ support lies at 1755 then again at 1725.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Russell Futures and Options Trading Recommendations

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

]]>

Commodity Trading School Market Summary

2009-12-08T15:10:15Z

U.S. Debt Review and Outlook

US TREASURIES regain some ground from last week's plummet, as dovish comments from Fed Chairman Bernanke prompted some short covering ahead of the first of three Treasury auctions this week.

A lack of fresh data to begin the trading week turned additional focus to comments from Federal Reserve Chairman Bernanke. Speaking at the Economic Club in Washington D.C, the chairman stated that the economy continues to face "formidable headwinds" in the form of sustained job losses and continued tightness of credit to borrowers at the consumer level. Based on this outlook, the chairman proposed that the pressure of higher interest rates and inflation going into 2010 would be moderate at best. Additional monetary support for US debt recovery stemmed from Chinese comments that the country would continue to support a strong pro growth policy.

Proportionally, the short end of the yield curve gained the most as traders expected a reasonable "out of the box" reception for the US 3 year note auction ($40 Billion)

Technically, March 30 year futures rebounded off support level hit in early November. Monday's rate of correction appears in line with expectation. Resistance based on short term rebound looks to find strong resistance at 119-24. Downside sentiment remains in place, with next downside target setting up at 118-04

U.S. Equity Review and Outlook

US EQUITIES traded mixed to slightly lower on Monday, as a lack of follow through from Friday's optimistic payroll number kept a subdued sentiment on equity trading. Initial support for stocks came from news that China would maintain a "pro-active" fiscal policy throughout 2010, while keeping its monetary policy accommodative. The outlook also put some pressure on the US dollar, giving back some of its gains from late last week. The Dollar then reverses back toward positive territory after traders digested Fed Chairman Bernanke's comments on likely ongoing and future headwinds for the economy going into 2010.

Telecom stocks were the best performing sector, led by strong outlook for Sprint Nextel and RIM. Early gains in credit card issuers eroded, after Bank of America posted a buy recommendation on the sector, citing improvement for earnings as the economy improves and fees/interest rate increases contribute to revenue growth. Obviously, the Fed Chairman's comments failed to inspire those stocks any further.

Technically, little has changed for December S&P futures have hit a double top in the 1113.00 range. Market appears ready to test downside of range at 1093.00, with 1084.50 setting up as a support. A break of this level could lead market further down the Fibonacci path to 1073.00. Resistance remains near 1113.00, as there has been no significant hold above this level. Should this level give way, upside targets for the contract set up at 1118.50 and 1122.50. A pattern of slightly higher highs could spur technicians to consider a strong push to try and hit high target for year of 1125.00.

Prepared by Rich Roscelli & Paul Brittain.

PLEASE EMAIL QUESTIONS OR COMMENTS TO RICH@BINVSTGRP.COM

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Commodity Trading School, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Back and Fill After Rally, but Bulls Still Have Edge

2009-12-03T16:13:56Z

According to the Fed's Beige Book, "economic conditions have generally improved". Unfortunately for traders, the stock market's reaction was nearly as bland as the news. It is hard to determine whether the equity markets failure to move higher is bearish or failure to move lower is bullish. One thing is for sure, the major indices are stuck in a rut.

As expected, the Fed's take on the economy showed a struggling job market but they did point out a few diamonds in the rough. In the Boston region, firms were beginning to hire and reverse pay cuts and in St. Louis the service sector expanded. Nonetheless, just last week the Fed claimed that it could take as much as five or six years for the employment picture to be back to "normal".

All eyes are on Friday's employment report but this morning the market got a glimpse of what might be on the horizon. Payroll firm, ADP, released their predictions of the government numbers. They believe that the U.S. economy lost about 169k jobs in November. If they are right, the number will be a slight disappointment but based on the fact that it is an improvement from last month and the market has already been warned (thanks to ADP), such a reading might be seen as temporarily supportive for equities.

We are sticking to yesterdays forecast:

"based on our chart work a continuation of the short squeeze could put the December S&P near 1130 in the coming sessions. This equates to 1840 in the December NASDAQ futures and about 625 in the Russell. However, we will be bearish at these levels!"

]]>

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Russell Futures and Options Trading Recommendations

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
cgarner@DeCarleyTrading.com
1-866-790-TRADE
Local : 702-947-0701

www.CarleyGarnerTrading.com
www.DeCarleyTrading.com

*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.

There is substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Solar Energy Showing Promising Signs After Years of Disappointment

2009-11-25T18:31:36Z

Image by tray via Flickr

After years of over promising and under delivering, the solar Industry is finally starting to show some interesting developments which have the potential to make solar power as cheap as fossil fuel on a cost-per-watt basis within five years. Getting us to that state, called grid parity, would require solar companies to produce power for around $1 a watt. Is it possible anytime soon?

Many analysts think so and the target date being touted around is 2015. The reason for this fresh optimism is a mixture of technological development and simple economics. Traditional conductive materials make up 40% to 50% of the cost of a finished module. Newer conductive materials (including, amorphous silicon, cadmium telluride and copper indium diselenide) only need to be about one micron thick, so material costs are significantly reduced.
But thin film solar cells are just the beginning. Here are a few more examples of the most cutting-edge and interesting advances in solar energy and the companies behind them.

Solar Energy - from salt. Rice Solar Energy, a spin-off of United Technologies, is planning a solar energy installation in Riverside County, California. Salt - 4.4 million gallons' worth will be stored in a 538-foot tower surrounded by 18,000 mirrors called heliostats. The heliostats will aim light at the tower, subjecting the salt inside to such great temperatures that it melts, which in turn creates steam which then spins the turbine thus creating electricity.

Internet access - from sunlight. Late last year, Meraki, a provider of wireless networking solutions, developed a solar self-powered WiFi device. The Meraki "Solar" uses a solar panel and a solar-charged battery to provide Internet access in hard-to-wire areas. The units can be mounted on roofs or poles or anywhere else that receives sun exposure.

]]> iPhone juice - without an outlet. Anyone who has an iPhone is plagued by the relatively low battery life, but we were recently alerted to a solution in that beacon of invention oddities, the SkyMall catalog. A company called Novothink recently developed the first Apple-approved solar charger for the iPhone. The $70 "Surge" is like an iPhone case, except it has a solar panel on the back. Just snap it on, and you'll have full access to the iPhone, while you charge. It even comes with a cord so you can hang the iPhone from a backpack or your wrist while outside. It will keep you Twittering all day long.

While all of those devices may be interesting, the first question on the minds of many may be just how close we are to generating all of our householder electricity from solar power. The answer: Closer than you think. One Japanese company, The Seven Ryoju Estate Group Companies, recently announced that it has developed a rooftop unit called the "Eco Sky Roof" that can provide 65 percent of a household's energy consumption from solar power. The roof works by creating a path of hot air between solar panels and a roof. That heat can be used to generate household heat and hot water, as well as electricity. The first installations are expected in 2010.

If Solar companies can stay the course and deliver on their promises, maybe a world powered by clean energy has a chance of becoming reality.

This article was submitted by www.OilPrice.com who focus on Fossil Fuels, Alternative Energy, Metals, Oil Prices and Geopolitics. To find out more visit their website at: http://www.oilprice.com

Can you say "Mutual Fund Monday"?

2009-11-23T21:42:01Z

Stocks started the week off with a bang; it seems as though Friday's option expiration was holding stocks down, rather than propping them up. With that out of the way, an economic calendar chock full of data and thinly traded markets we can't help but looking higher from here. Thanksgiving has always seen investors give thanks by buying up shares of stock, so we are expecting the December S&P to see 1130ish at some point this week.

Coming into this week, we were looking for weakness in early Monday trade with the premise that weakness could be an opportunity to "get long" with either options or futures. However, that weakness never arrived. Instead, the stock index futures opened up firm on Sunday evening remained overall positive throughout the entire session.

Equity index futures were outperforming before the day's news, but better than expected home sales and a weaker dollar were the icing on the cake for stock market bulls. According to the National Association of Realtors, October home sales rose more than 10%.

The trend is higher and the volume is light but the data is thick. Despite the shortened trading week, we will hear about the latest GDP reading, consumer confidence, the FOMC minutes, new home sales and Michigan sentiment as the week progresses. Barring any large surprises in the data, and aside from potential back and fill trade in the overnight session the market "feels" higher from here. Our first resistance in the S&P is near 1024 but we think that 1030 is in the cards. If you are trading the NASDAQ, we see resistance near 1820 but feel like 1840 is possible, at which time we would be bearish. Look for resistance in the Russell near 606 then again near 625.

]]> *Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version.

S&P 500 Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

November 11 - We recommended that our clients sell the December S&P 1160 calls for $7 or better. Some were getting fills near $6.75 others opted to continue working the order at $7.
· November 16 - Standing orders to sell the 1160 call for $7 were filled.
· November 19 - clients were recommended to buy their December 1160 calls back this afternoon on the dip. Fills were coming back from 2.75 to 2.85.

Russell Futures and Options Trading Recommendations

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

Flat

Can a Gambler Do Well in Trading?

2009-11-19T00:15:29Z

It is not rare to come across definitions of trading as gambling. Although this is intended to show trading as a kind of fool's errand with little benefit to a reasonable person, in fact, gambling does resemble trading in some respects, with hardly the scandalous results claimed by the loud critics of the practice. Both gambling and trading are about risk controls, and both of them are not for all kinds of people. If you're an impulsive person who doesn't like analysis, and if you don't appreciate the value of patience and self-control, it's unlikely that you'll perform well in either gambling or trading. On the other hand, many great traders and investors are also great card players (in bridge or poker, for example), and there's every indication that the same qualities lead to success in both types of activity.

]]> 1. Analysis is mostly useful for establishing entry/exit points

In gambling you can never have complete confidence in your decisions. There are always unknowns, and you need to make educated guesses about different aspects of every game in order to be successful. The same is the case in trading. Analysis provides guidelines, but no outcome is certain, and you have to carefully consider the various option available, and weight the benefits of each one if you want to be successful.

2. Risk management is key to success

As a consequence of the above, in both trading and gambling, careful control of risks is crucial for success. It is impossible to eliminate uncertainty about the decisions of others, so we behave in such a way that our own behavior places us in the most advantageous position. We do not take too high risks while trading or gambling, well aware that doing so will quickly decimate our fortunes in both.

3. Emotional Control is paramount

It's impossible to be a good gambler without calm nerves, and emotional control. Similarly, it is not possible to do well in trading without excluding emotions as much as possible from our trade decisions.

4. Understanding probabilities and chance are crucial

Since both gambling and trading are dependent on various unknown variables beyond the trader's control, an understanding of probability and chance is crucial to tilt the scales in our favor.

5. Cut losses short, let profits run

Finally, the most important rule. Gamblers have their days when they are most alert, physically and mentally in top form, with great reflexes and confidence, when they can intimidate opponents, leading them to irrational decisions, while they make the most of the circumstances. Traders have their good and bad days, when they apply their strategies most efficiently, and are least influenced by emotional extremes. A successful person in either activity will try to intensify his activity when the conditions are most favorable to him, and will refuse to risk anything when he's in less than optimal shape.

Trading is all examining the odds, and trading when they are in your favor. It is not about controlling them. The most that you can control about the market is the broker. By receiving the services of a competent firm, you can minimize the headaches related to faulty beginnings. It doesn't matter, in the end whether you're a gambler or a trader, since a successful career in either one will catalyze your success in the other.

Stocks Pause After Sharp Rally

2009-11-17T22:26:19Z

It isn't uncommon to see consolidation after a large market move and that is exactly what we got on Tuesday. The stock rally was halted by a rally in the U.S. dollar and technically overbought market conditions.

The earnings reports offered by retailers were better than expected, but the good news was served with a bit of skepticism going into the holiday shopping season. Following several weeks of gains, the news provided little incentive for fresh longs. Also, the retailer revenue warnings came after the market enjoyed massive gains posted on better than expected retail sales data.

The major indices dipped in early trade, but the selling was muted and buyers were present. Although much of the buying was likely shorts taking the opportunity to cover at better prices, failure of the December S&P futures to trade below 1100 suggests that another wave of buying could be seen before a reversal can occur. That said, we still lean toward bearish strategies on rallies. Don't chase the markets lower!

We can't rule out a run to retest Monday's highs and likely reach for stops above. Look for resistance in the S&P futures near 1117 and could possibly see prices as high as1130 but we grow bearish above the first resistance. If you are trading the Russell, we would see 615ish in the next day or two at which time we would be bears. The NASDAQ begins looking like a good opportunity for the bears near 1825 but 1840 is possible.

]]> * Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.

**Seasonality is already be factored into current prices, any references to such does not indicate future market action.

Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version.

S&P 500 Futures and Options Trading Recommendations

Russell Futures and Options Trading Recommendations

NASDAQ Futures and Options Trading Recommendations

**There is unlimited risk in naked option selling and futures trading

Position Trade -

November 16 - Sell 1 December e-mini NASDAQ at 1840 OB.

Ranking of 250 Top Performing Global Energy Companies

2009-11-16T20:27:41Z

Global Oil & Gas Companies Dominate; Non-Western Companies Exert Increasing Influence

SINGAPORE, Nov. 16 /PRNewswire/ -- Despite unprecedented price volatility, global recession, swings in demand, and the "greening" of the world's energy priorities, major oil companies maintained their stronghold as the world's top-performing energy businesses, according to the 2009 Platts Top 250 Global Energy Company Rankings(TM) announced here Monday evening.

Houston-based ExxonMobil Corporation retained the number one spot in the Platts Top 250 for the fifth consecutive year in the roster's eight. In second and third place were Chevron Corporation and Royal Dutch Shell plc, followed by BP plc and Total SA in fourth and fifth, respectively. Altogether, integrated oil and gas companies (IOGs) carved out the 13 top spots in the 2009 Platts rankings, and took 30 of the top 50 places.

"Besides showing the continued leadership of the international oil companies, the rankings highlight the rising importance of emerging market entities and stronger performances by utilities," said Platts President Larry Neal. "Clearly, the ups and downs of the rankings reflect the opportunities and challenges of the various sectors - exploration and production companies benefited from new finds, utilities enjoyed green-related investments, and storage companies got a boost from the slow demand that bit into refiners' margins."

Latin American IOGs played a more prominent role in the 2009 rankings with Petrobras leaping to sixth from 12th place and Colombia's Ecopetrol joining the list for the first time in 30th place. Also new to the rankings was Brazilian storage and gas company Ultrapar Participacoes SA, which moved in the 202nd spot, giving Latin American companies 14 spots on the global list.

]]> Russia's Rosneft Oil Company and Gazprom Oao again made the top 10 list, coming in seventh and eighth, respectively. Gazprom also ranked number two in terms of profitability, second only to ExxonMobil. With LUKOIL Oil Company at number 12 and TNK-BP Holdings jumping to 13th place from 23rd, four Russian companies now rank among the 15 top-performing energy companies in the world.

Ahead of many long-entrenched names on the roster, Petrochina Co. Ltd. again took ninth place worldwide and maintained its leadership position in Asia. Second, third, fourth and fifth-place among Asia's top performing energy companies went to CNOOC Ltd., China Petroleum & Chemical Corp., Reliance Industries Ltd., and Oil & Natural Gas Corp. Ltd. Immediately behind them - giving Asia a total of eight places among the global top 50 - were Indian Oil Corp Ltd., China Shenhua Energy Co. Ltd., and Thailand's PTT Plc.

Germany's RWE AG, which moved into 14th place from 20th, displaced France's EDF Energy as the only utility among the top 15 global energy leaders. While the total number of utilities on the Top 250 remained consistent year to year, utilities comprised 15 of 32 newcomers to the 2009 Platts Top 250 rankings. Of those, seven were electric utilities and the rest were gas, diversified and independent utilities. The other newcomers to the rankings came primarily from the exploration and production and storage and transportation sectors.

Geographically, Platts' newcomers span the globe, coming from Spain, Switzerland, the U.S. and U.K., Canada, France, Italy, Japan, Germany, Indonesia and Romania, as well as Colombia and Brazil.

The Platts Top 250 Global Energy Companies Rankings are based on a combination of assets, revenues, profits and return on invested capital using data from Capital IQ, a database compiled and maintained by Standard & Poor's, which, like Platts, is a division of The McGraw-Hill Companies. To be ranked, companies must have assets greater than US$2 billion and must be publicly listed.

Platts tonight also unveiled its third annual list of the world's 50 fastest-growing energy companies. Topping the list was ONEOK Partners LP of Oklahoma, a storage and transfer company, which ranked 129 in the overall top 250 and whose 125 percent compound growth rate (CGR) far eclipsed that of other firms. Nester Energy LP of Texas took the number two spot in the global fastest-growing, sporting a three-year CGR of 94 percent. The Abu Dhabi National Energy Co. and Ultrapar Participacoes SA came in as third and fourth fastest-growing, with CGRs of 85 percent and 82 percent respectively. In fifth place was Hong Kong's China Resources Power Holdings, an independent power producer, with a 65 percent growth rate.

Platts' 2009 performance rankings were unveiled at the company's fourth annual Asia Leadership Awards and Recognition Dinner, held this year at Singapore's Shangri-la Hotel in partnership with Singapore International Energy Week. The gala event, attended by some 300 industry executives from across Asia, featured keynote remarks by S. Iswaran, Singapore's Senior Minister of State for Trade and Industry, and also celebrated the accomplishments of the top 15 Asian energy companies, the top 10 fastest growing Asian energy companies, and the top Asian energy companies by industry sector.

The dinner's principal sponsor was SolArc, Inc., a global provider of commodity supply, trading and risk management software and services. Serving as co-sponsor was Logical Information Machines, a provider of data, analytics and research to the energy and financial sectors.

For more information and complete rankings, go to the Platts Top 250 website (http://www.platts.com/top250/) or media kit (www.platts.com/MediaKits.aspx?xmlfile=mediaTop250.xml).

About Platts: Platts, a division of The McGraw-Hill Companies (NYSE: MHP), is a leading global provider of energy and commodities information. With a century of business experience, Platts serves customers across more than 150 countries. An independent provider, Platts serves the oil, natural gas, electricity, emissions, nuclear power, coal, petrochemical, shipping, and metals markets from 17 offices worldwide. Platts' real-time news, pricing, analytical services and conferences help markets operate with transparency and efficiency. Traders, risk managers, analysts, and industry leaders depend upon Platts to help them make better trading and investment decisions. Additional information is available at http://www.platts.com.

About The McGraw-Hill Companies: Founded in 1888, The McGraw-Hill Companies (NYSE: MHP) is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands such as Standard & Poor's, McGraw-Hill Education, Platts, Capital IQ, J.D. Power and Associates, McGraw-Hill Construction and Aviation Week. The Corporation has more than 280 offices in 40 countries. Sales in 2008 were $6.4 billion. Additional information is available at www.mcgraw-hill.com.

SOURCE Platts

How High Can Gold Go?

2009-11-13T13:17:10Z

Gold is one of the hottest topics of these days, as many forex traders note the new records broken by the commodity, and speculate on the sparkling future awaiting those who prefer it as an investment medium. Gold had been doing very well over the years as the global flood of money caused just about any tangible asset to rise in value, including real estate, commodities, stocks, and many others. In these difficult times, gold's rally has been one of the more resilient, supported by its role as a safe heaven in times of crises of confidence, and its ancient character as a store of value. Many are further convinced that the extreme fiscal irresponsibility of the government, and the unlimited and general bailout policies of the Federal Reserve will eventually result in a collapse of the American economic system, against the turmoil of which gold is seen as a good insurance. In this context, how high can gold go, and what may halt its insistent ascent?

It's common knowledge that the rise of gold depends on the two factors of inflation, and fear. Usually, inflation occurs when the economy is growing, and when there's growth, there's little sign of panic or fear among market participants. Inflation leads investors to diversify, and gold appreciates. In the other case, where fear prevails, gold is expected to appreciate as a source of safety against the unreliability of other kinds of financial assets. Although so far gold has not demonstrated that conviction forcefully, as investors flock to government paper in times of crisis, its quick return to popularity shortly after periods of turmoil demonstrates that traders attach fundamental value to the asset at times of long-term uncertainty. Still, as we see, the two conditions of gold's appreciation are more or less mutually exclusive; if there's inflation, there's probably little fear, and if investors are fearful, inflation is likely to be subdued.

The mega-bull gold market, if we substitute this term for a gold bubble, would materialize if these two factors of fear and inflation can somehow come together to create optimal conditions for very sharp appreciation. If dollar begins to depreciate out of control, even without domestic demand, inflation would be inevitable, with widespread panic and fear leading to the complete destabilization of the system. If the U.S. dollar ceases to inspire confidence as a source of value, gold could easily skyrocket to astronomical levels of many thousands of dollars.

The problem with the "Gold 5000" or more scenario is that it is very difficult to see the dollar lose it's status as the global currency in the next five ten years barring a major economic cataclysm destroying the international financial system. With about two thirds of global reserves denominated in the U.S. dollar, most of the debt issued in the world is also sourced through some kind of dollar borrowing, which leads to the currency gaining in value as economic confidence evaporates. The financial actors, including governments, and major financial institutions will do anything to prevent a dollar collapse. But they may fail given how optimistic their assessments usually are, and if they do, nothing will be able to halt the rise of gold. No forex trading course or government briefing will tell you how to anticipate such a situation, and the only way of avoiding being at the bottom of the list of losers is remaining up-to-date with the commodity market at all times. One thing is for sure: gold has held its value over the centuries, and it will remain an attractive asset regardless of the wisdom of future decisions taken by politicians and investors.

Possible S&P Double Top

2009-11-13T12:39:06Z

I haven't pulled up the S&P 500 with oscillators to determine for sure if we're seeing a double top or just a 'pause that refreshes' before powering to new highs.

What seems to be 'certain' (for the moment) is that weakness in the dollar seems to be correlating rather strongly with strength in the US equities market. There seems to be a powerful 'carry trade' on the dollar where synthetic shorts are being created by large institutional entities that can borrow usd for effectively 'free' and placing levered trades on govt backed bond instruments elsewhere (like the aud) where interest rates are much higher.

If/when that trade unwinds, it will look like a movie theater where the curtains are on fire -- powerful upsurges in the usd, coupled with a downdraft in the equity markets is what would be 'expected'. Of course, the 64 usd question is, when?

Unfortunately, a carry can last for days, or years as in the case of the jpy carry that persisted for years. So getting the timing right, while lucrative if right, can be maddening and account draining when not.

Stock Market Investors Network

2009-11-12T17:30:27Z

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