Cosmic's MarketPlace Wrap - 2/19/10

[cosmic]

Opex done. The expected turmoil from last night's Fed rate change seems to not have given the bears what they needed today. There are two thoughts I'm having... No, not today, Opex needs to be served, and we get the full market effect next week, OR, that's it, didn't mean much, just a blip, everyone keep moving. I can't decide so I remain hedged.

Bonds continued their trek lower however picked up some speed. The formation on the chart looks eerily like a cup and handle - something to keep an eye on as it can be a bullish pattern for bonds, which is bad for stocks.

Hope everyone made some money today and will do so on Monday. Regulars, please post your results and include plenty of smileys!

Bond and RIFIN charts:

[philip2012]

Yeah, I understand those who are still not convinced the bears have been smashed once again. I was at the point though a week ago, today was again just another 'crazy day in lunatic market-land'.

This market headed higher, we got the close above SP'1105, thats two days running now. Just one more day, and the technicians (and all those auto-trading computers) will start hitting the buy button, regardless of the fundamentals which continue to worsen.

I myself would prefer an exit no later than next Thursday, GDP is out next week, revised, and its likely to be knocked down quite a bit.
-

Thanks for charts, useful to see.

yours
the worlds biggest permabear...but now able to ride the 'lunatic bull train'.

[cosmic]

Feb 19, 2010 16:15:42 GMT -5 @philip2012 said:

Yeah, I understand those who are still not convinced the bears have been smashed once again. I was at the point though a week ago, today was again just another 'crazy day in lunatic market-land'.

This market headed higher, we got the close above SP'1105, thats two days running now. Just one more day, and the technicians (and all those auto-trading computers) will start hitting the buy button, regardless of the fundamentals which continue to worsen.

I myself would prefer an exit no later than next Thursday, GDP is out next week, revised, and its likely to be knocked down quite a bit.
-

Thanks for charts, useful to see.

yours
the worlds biggest permabear...but now able to ride the 'lunatic bull train'.

Philip, keep those bunker posts coming, very much enjoyed the read last evening.

[sloop]

Got off to a rocky start and lost 250 bucks on my FAS short then got it right and made 1300 on FAS not believing in the rally I sold way to early but I made 1K today to spend this weekend so I an very happy. I did buy 2K Shares of HPQ for next week.

[brosin]

Fun little day even though I ended up slightly red overall. Got a nice surprise that my tax return came so quickly.

Sold my EDC @ $112.50 for a few %, got avg down to $16.47 on LVS by scooping some up at $16.13, grabbed some UNG @ $9.23 and $9.18, SVA @ $6.89, and a small amount of IMGG @ $.71.


Going into next week with APWR/IMGG/LVS/MSBT/SVA/UNG. I expect it to be a nice up week again. I believe the market closed just above its 50 dma (can someone confirm or disconfirm that?).

A good week overall though. I made some dough, got lucky to have all 3 of my Bull/Bear votes right (didn't vote Monday night / wasn't on board yet), I think called the bottom on LVS, and came out 2$bb richer. Not to mention the Fed has given a shot of adrenaline (called confidence) to this market. I see my FOMC theory / new high before March 16th playing out well. GL all. I'll be around a little later I believe - if not, I'll see yall tomorrow.

And a thanks to Cosmic for putting this all together. Been a great first week in the new MB home here, and it is w/o doubt a huge success. Also been a great first week in my new real home. Yes, definitely been a good week.

[Dualism]

So did the benign CPI report trump the poor PPI report of yesterday along with the raise in the discount rate? Or was it mostly the OPEX influence that drove today’s action?

The VIX popped to above 21.08 resistance but was pushed back early in the session, signifying bearish rejection.

The combined market breadth improved gradually early in the session and plateaued the latter half of the session.

The T-bond futures closed higher today, showing little concern to the fed’s rate increase.

Closed out LVS Feb 17 puts and 16 calls.
Closed out FAZ Feb 19 puts and 18 calls.
Closed out FAS Feb 74 and 71 calls.
Added to FAZ Mar 20 and 19 calls.
Traded PCLN for a 70 cent gain.

Expired worthless:
FAZ Feb 20, and 19 calls.
LVS Feb 16 puts.
TZA Feb 10 calls.
DRV Feb 13 and 14 calls.

I was derailed early into Feb option cycle by poor hedging, but through some defensive action and a forgiving market rebound, the ship was up righted in the last week and a half. With Feb options losing all of their TP today and coupled with the VIX closing lower by around 3%, my account rose 3.9% in value today. Remarkably, the final February option month cycle performance exceeded my goal of 20% by 0.7%.

My goal for March option month cycle remains +20%. GLTA

[brosin]

Feb 19, 2010 16:35:54 GMT -5 Dualism said:

So did the benign CPI report trump the poor PPI report of yesterday along with the raise in the discount rate? Or was it mostly the OPEX influence that drove today’s action?

The VIX popped to above 21.08 resistance but was pushed back early in the session, signifying bearish rejection.

The combined market breadth improved gradually early in the session and plateaued the latter half of the session.

The T-bond futures closed higher today, showing little concern to the fed’s rate increase.

Closed out LVS Feb 17 puts and 16 calls.
Closed out FAZ Feb 19 puts and 18 calls.
Closed out FAS Feb 74 and 71 calls.
Added to FAZ Mar 20 and 19 calls.
Traded PCLN for a 70 cent gain.

Expired worthless:
FAZ Feb 20, and 19 calls.
LVS Feb 16 puts.
TZA Feb 10 calls.
DRV Feb 13 and 14 calls.

I was derailed early into Feb option cycle by poor hedging, but through some defensive action and a forgiving market rebound, the ship was up righted in the last week and a half. With Feb options losing all of their TP today and coupled with the VIX closing lower by around 3%, my account rose 3.9% in value today. Remarkably, the final February option month cycle performance exceeded my goal of 20% by 0.7%.

My goal for March option month cycle remains +20%. GLTA

Wow nice work Dual! I'm going to have to start keeping track of my monthly tallies I think. A good way to keep one disciplined.

[commodityypro]

No action today, just a lot of conflicting things going on and it was evident the market felt the same way. OpEx Friday and the Chinese NEw Year make this day basically a nothing day, volume was pathetic again. Next week should give some clarity on movement.

Brosin - Why do you say the Fed "surprise" decision to move the emergency bank lending rate was a "shot of adrenaline into the markets arm?" Don't you think if the smart $$ thought this that we would not have had such a violent AH reaction and then no real green push today. And no to mention the move down in the 10 yr yield today when it should have gone up if in fact what you say about the shot of adrenaline is being seen by investors as that or more of a sticking the needle in the market to pull blood.. I guess that's why there are bulls and bears..lol Congrats on your $2 Bernanke Buck win today. You did call it, and were one of the few to do so last night. Nice call!

GL!

-Commodityy

[elle]

spx pierce, close below 61.8 - 1109.98

[cosmic]

Feb 19, 2010 17:59:11 GMT -5 commodityypro said:

No action today, just a lot of conflicting things going on and it was evident the market felt the same way. OpEx Friday and the Chinese NEw Year make this day basically a nothing day, volume was pathetic again. Next week should give some clarity on movement.

Brosin - Why do you say the Fed "surprise" decision to move the emergency bank lending rate was a "shot of adrenaline into the markets arm?" Don't you think if the smart $$ thought this that we would not have had such a violent AH reaction and then no real green push today. And no to mention the move down in the 10 yr yield today when it should have gone up if in fact what you say about the shot of adrenaline is being seen by investors as that or more of a sticking the needle in the market to pull blood.. I guess that's why there are bulls and bears..lol Congrats on your $2 Bernanke Buck win today. You did call it, and were one of the few to do so last night. Nice call!

GL!

-Commodityy

The ONLY thing I can think of is that big boys don't trade in Amateur Hour. They weren't bothered either way.

[exabi]

No trades, teensy red on the port, surprised that my CENX ended up while AA down. Kinda of a schizo day.

[tajmahal9898]

Glad Feb Opex is finally over.. First 2 weeks were horrible.

Quick in n out DELL for 7.5K profit

Did something that I would not recommend others to follow.. I sold my MRVL shares at 20.4 and then went naked on my covered Feb calls, i.e was holding just short Feb calls. Right before the close, I purchased the shares back. These calls would now be exercised tomorrow. In the end, a profit of 39K on shares, a loss of 12K on covered calls, for a net profit of 27K.

Total profit today 34.5K

I was down 300K in first week of Feb. Since then
recovered 150K loss in Fas ( 13K in call premium + 2k difference in the strike Price). Still down 70K
Recovered 60K loss in MRVL and actually made a profit 53K in MRVL
Recovered 32K loss in AA and shifted the strike price to 14 and 15
+ a lot of day trading

NET RESULT: Profit of 53.6k (including carryover loss of March calls)..

I seriously got lucky this time..

[Rich]

Still holding that short position. I did think about selling early, but I didn't and oh well. I know mutaul fund monday is looming, so I'm a little nervous. Yet I still feel like we're due for a down day. Still at the top of the channel.

[torrentio1]

I experienced a bullish market portfolio down session today with tech stocks noticeably far more volatile than the rest...

Very good to see VIX close below 21 again and the Transports clear and close above the 4055 level...

As well we see Airlines potentially at weekly breakout point again (a couple noteworthy performers: ALK & DAL) -maybe this time is the charm? IF we see a breakout then the leader, Transports, will lead the markets higher... --With a bullish bias set and indicator room for upside I expect to see SPX hit at minimum the 1132ish level before it is hotel / motel time to reevaluate...

Anyway, time to polish my bull horns.... Weekend analysis is in order...

Hope all did well.

;D

[jack]

Here's Jim's take on the RIFIN fyi from the FAS YMB:

Weekly RIFIN chart... 19-Feb-10 07:15 pm I rarely post a weekly chart but this one is interesting.

First, I have ALWAYS ignored the panic bottom in late Winter of 2009. I have always thought that the last steep plunge into 3/9 and the equally steep recovery in the next week or so was simply too extreme to really be useful as a data point on a trend chart. I did this after doing some research by some great chart readers who have published charts where panic bottoms and climax tops were excluded once a confirmed bottom or top was in and a new trend started.

Guys, it has been about 10 months since I first changed my mind and saw this as a bull market. Truth be known, I have not traded it as well as I would have liked. I missed a few very good trades and made a few bad ones too. Live and learn. But, despite that, NOTHING HAS CHANGED in the chart to convince me that this is not a real live & kicking bull market. In fact, I think the chart is telling us that the banks are about ready to explode upwards with BAC getting over 20, GS running at 200, JPM getting over 50 and WFC into the high 30's. Not overnight, mind you.

The inverse H&S in RIFIN has now PULLED BACK to test the neckline on the move under 60. That pullback shows up as 4 solid weeks of red candles. Where else in the chart do we see a similar pullback post 3/9? We see 5 weeks of red that ended in mid-July. Those 5 weeks primed a huge move, and the breakout from the iH&S pattern that DOUBLED FAS from the mid 30's to over 70 (going from memory...).

Will this happen again? I do not know. However, with the neckline test and 6 months of consolidation as a base this is an opportune time for a nice run. First, nobody is expecting it. The markets like to make as many people as possible look stupid. I am comfortable being in the minority with my outlook.

Here is the chart...

www.freestockcharts.com?emailChar...

[kbk3ck]

I just hope for a little pulback thru Tuesday then to Da Moon Alice!!!!