EUR/USD closed the day unchanged, while we saw some weakness in USD/JPY. Disappointing U.K. growth figures also put pressure on GBP/USD.
All eyes now turn to the Chinese markets overnight, which were down the most in four months last night. Further weakness could cast a cloud over tomorrow’s U.S. open.
Break-even: I break-even on this trade if MOS closes at $53.75 or $58.75 by March 30, 2012.
Unprofitable: This trade is unprofitable if MOS closes under $53.75 or above $58.75 by March 30, 2012. The most I can the amount either spread can be worth $2.50 minus the amount I sold it for $1.25 for a total of $1.25.
Reason I Like This Trade: I wanted to take advantage of the lack of movement in MOS and I think the stock is stuck in a range. This is a great way to trade this stock that I thought would not make a breakout to 52 week highs and dips will be bought, but I always like to define my risk vs reward so I bought Calls since I think the stock will move higher.
UPDATE 4.9.2012 This spread expired worthless and a great way to turn $1.25 to zero. I have been playing earnings very well, so I will continue to trade them.
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In equities, the DJIA is pushing triple-digit losses at the moment, down 0.7%, while the S&P 500 and NASDAQ indices have shed 0.8%. Apple (AAPL) is around the flat-line for the day after dipping into negative territory early in the session.
This might be the time to either sell your Gold position or fade the GS trade. GS recommends buying the Dec-12 Comex Gold OTM Futures. WTI is under heavy selling pressure following last night’s build in oil reserves shown by the API data. French press reported that France had made contact with the UK/US regarding the release of emergency oil stocks like ZAZA (previous symbol TRGL).
US economic data includes durable goods orders and the weekly DOE oil inventory due later today.
Today, might have been a fake-out shake-out and shaking out some weak bulls. I remain bullish and think the market will trade higher, but with so many bullish traders into quarter end, could we sell-off?
In other news, oh yeah, AAPL hitting another all time high with strong stocks such as PM and YUM getting stronger by the day. I continue look for any and all pullbacks to get long there stocks. Have a great night and remember you gotta be in it to win in.
Andrew Keene KeeneOnTheMarket.com
Fast Forward to 3:20
Crude Oil was one of the only commodities that showed weakness yesterday in trading. Perhaps Geo-Risk Premium is coming out Crude Oil as Syria’s and Iran’s hostile environment is calming down a little and Crude Speculators are taking profits now and not before the next big Crude Sell off. Gold is approaching $1,700/oz after yesterday’s Bernanke hints at the new “QE” and today’s urging by the OECD to increase the Euro-zones ‘firewall’ by another $1.3 trillion. Gold is above 200 day moving average (simple) at $1,687/oz after yesterday’s biggest daily gain since January 2012. The gains came after Ben Bernanke warned investors of the risks to the fragile US economic recovery and signalled the Fed would keep interest rates low – aka buy gold for an inflation hedge.
Economic Events:
US Consumer Confidence (Mar).
S&P Case Shiller Home Price Index (Jan).
Turkey CB Meeting and Hungary CB Meeting.
Ben Bernanke Lecture
Italian Bond Auction (2/10yr)
It is un-American to be short the stock market. I talk about this all the time and my goal is to make the most amount of money possible, and every dip should be and has been bought. Yes, every couple of weeks we shake the week hands out, but the the fact is america is the best house in a bad neighborhood. Today the stock market took out all 3 of my upside targets in the S&P 500 futures of 1400, 1408, then 1411 and closed at the highs of the year at 1415. I think more window dressing continues and will rally for the rest of the week. After that, earnings come into play and should be strong, so it’s time to jump on this train before it’s too late.
Break-even: I break-even on this trade if P closes at $11.70 by May 18, 2012.
Unprofitable: This trade is unprofitable if P closes under $11.70 by May 18, 2012. The most I can I can lose is the $.70 that I paid for the Calls.
Reason I Like This Trade: When P was trading $10.46, I saw a customer buy 2439 Pandora May 11 Calls for $.70. I then saw more unsual options activity and paper sell May 11 Puts and April 10 Puts. I knew that I wanted to get LONG, but I always like to define my risk vs reward so I bought Calls since I think the stock will move higher.
UPDATE 4.9.2012 These Calls are currently worth $.25 and this trade has not worked out very well. Since I know I can only lose $.25 more cents I will leave these Calls on.
UPDATE 4.11.2012 These Calls have now turned into a lottery ticket and another stock where I have purchased Calls and have not worked out very well. I will look to take this trade off with any rally in Pandora.
UPDATE 4.23.2012 Another worthless Calls as these Calls are only worth $.10. I realize now that everytime I buy Calls they go to zero, so I will be doing that anytime soon.
UPDATE 4.30.2012 With a rally in P last week, I took these Calls off for $.15, realizing that some money is better than none. Moving on to the next trade
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