Apple (AAPL) and Google (GOOG) Pivot Points for 9.14.2012
Category: Blog
Trade of the Day (FST) 9.13.2012
Trade: Buying the FST Oct 10 Calls for $.20
Risk: $20 per 1 lot
Reward: Unlimited
Notes: Good risk vs Reward, but need a Parabolic move higher.
UPDATE 9.16.2012 With the stock moving higher, these Calls are exploding to the upside. These Calls are now $.60 good for a terrible.
UPDATE 9.21.2012 I took high off at a double and now the Calls are worth $.25 and I will leave the rest on until Expiration, playing with the house’s money.
Fed Announcement 9.13.2012
The program will be open ended; the aggressiveness will depend on the rate of economic improvement and recovery. The Fed will also continue Operation Twist, buying longer term bonds in an effort to lower long term interest rates.
The combination of the new mortgage buying program and Operation Twist will add around $85 billion to the Fed’s balance sheet every month which is currently at $2.8 billion.
The FOMC will closely monitor the effects of each month’s asset purchases, and will make adjustments accordingly. The Committee also anticipates that exceptionally low fed funds rates will likely be warranted at least through mid-2015.
The FOMC forecasts and press conference is scheduled for today at 2:15pm ET where the Fed will release its growth forecasts.
James Ramelli B.S. in Finance from UIUC. Email: james@keeneonthemarket.com Follow: @Jim_KOTM
AAPL's Price Targets Chart 9.13.2012
Morning Rage 9.13.2012
There is plenty of news to play to today. The Jobless claims Report and Producer Price Income Reports are set to come out at 8:30 AM EST, the FOMC Forecasts at 2:00 PM EST, followed by the Bernanke’s press conference at 2:15 PM EST. Last week, there were 365 thousand new jobless claims reported and projections have a growth in claims to 370 thousand with a possible high of 380 thousand. The Producer Price Index, which measures the average change in prices received by domestic producers, is projected to increase 1.4%, but only 0.2% not including food and energy.
The Fed estimates released today will cover GDP growth in 2012 and 2013, inflation and unemployment. The market’s movement over the past couple weeks suggests that investors and traders expect an announcement of intervention, and the only tool the Fed has left is a quantitative easing. I expect heavy movements late in the day today or early tomorrow morning during higher trading volume.
The Apple (AAPL| 669.79) iPhone 5 event has finally passed and consumers are left with an upgraded version of the iPhone 4. AAPL was up $9.20 at the end of the day after many volatile movements, hitting new highs and lows throughout the day, a $15 range. In pre-market trading today, AAPL is up again another $5.71 to around 675.50, which is less than ten points from its all-time high hit at the end of last week. One company that should be highlighted during all the hubbub about the iPhone 5 is Nokia.
Nokia Corporation (NOK| 2.75) has had a tough year with a 52-week range of 1.63 – 7.38. NOK has been in steady decline since the beginning of the year. In pre-market trading today, NOK is up 1.82% and expect it to continue to grow if iPhone fanatics get bored with the new upgraded model. If you have seen the Lumia, you know that Nokia has built a beautiful product worthy of competing with the best smartphones. The new Lumia phones are said to run on the windows phone 8 operating system. An earnings report is expected around mid-October, estimating a $-0.12 EPS. I might look away from a short play on NOK, but a long-term and cheap OTM call spread would be a play that interests me.
Alex Kalish has a master’s degree in economics from Suffolk University.
For comments, questions, or suggestions: alexk@keeneonthemarket.com
Market Recap 9.12.2012
The new phone will also be lighter and thinner than previous versions. The iPhone 5 will retail for $199-$399 with a 2 year contract with a service provider. In addition to the iPhone 5, Apple announced a new line of iPods. Updates to iTunes were also unveiled, users will now be able to share photos via Apple’s iCloud.
Coming up tomorrow, markets are looking to the FOMC meeting announcement and forecasts as well as Bernanke’s press conference. Bernanke is expected to announce another round of quantitative easing. The recent poor employment numbers support Bernanke’s case that the economy is struggling. However the upcoming presidential election complicates the upcoming Fed decision. Any position that Bernanke takes will likely be viewed as politically motivated. A new jobless claims report is also scheduled to be released tomorrow.
James Ramelli B.S. in Finance from UIUC. Email: james@KeeneOnTheMarket.com Follow: @Jim_KOTM
S&P Emini Pivot Points for 9.13.2012
Apple (AAPL) and Google (GOOG) Pivot Points for 9.13.2012
Trade of the Day (NRG) 9.12.2012
Trade: Buying the NRG Sep 22 Straddle for $.95
Risk: $95 per 1 lot
Reward: Unlimited
Notes: Paper bought 4892 NRG Sep 22 Puts for $.40 OPENING position
UPDATE 9.16.2012 With time decay is against me, these Straddles are worth $.70, but time is working against me.
UPDATE 9.21.2012 I sold all my Puts out at $.65 and and Calls expired worthless, so the Straddle was sold for $.65. Moving to the next trade.
Halftime Report 9.12.2012
Some of the announcements from today include iPad sales of 84 million units and the iPad accounts for 91% of web traffic. The phone has a thinner, lighter and bigger glass screen and aluminum case. Apple gave developers an early peek at the specs in order to have apps available for the new dimensions. The new iPhone is both HSPA+ and LTE compatible on a single chip and single radio. It has a new A6 processor with double the speed of CPU and graphics. The 5 is an overall upgrade from the iPhone 4.
AT&T Inc. (T) move up one dollar early in the morning most likely on news from Apple (AAPL) releasing its new iPhone 5. The stock is now up only $0.15. The carriers will have to pay a high premium to get the iPhone 5, contributing as much as $400 per customer for a two year contract.
The DOW is up 26 points today, 0.19%, to 13,347; The NASDAQ up 10 points, 0.34%, to 3,115 and the S&P is up 4 points, 0.31%, to 1,438. The DOW started higher today and peaked early in the morning at 13,374 and then hit a low around 11:00 am of 13,318. It is hard to tell what is moving the market today as both positive and negative news has come out of the media today.
Gold futures are flat, silver and crude futures are down less than half of a point but platinum futures jumped up 41.90 points today, a 2.61% gain. Corn futures are down -9 points, a 1.16% drop. Corn peaked around 830 in the middle of August and has since been down, currently sitting at 768.60.
Imports and Export prices came out today. Import prices are down on the year by more than 2%. Jobless claims and Producer Price Index tomorrow at 8:30 am EST.
Alex Kalish has a masters in economics from Suffolk University.
Questions, comments and suggestions welcome: alexk@keeneonthemarket.com