Paper Sold 155850 FXI May 35 Puts for $1.03 (4.1 times usual volume) with stock trading at $34.85
Paper Sold 10000 ABX Jan 15 Puts for $1.175 (2.1 times usual volume) with stock trading at $18.83
Paper Bought 20000 AGNC May 32 Puts for $0.66 (5 times usual volume) with stock trading at $32.08
Paper Sells 25000 BHP Aug 50 Puts for $0.70 (5 times usual volume) with stock trading at $63.77
Paper sells 53810 FXI A[r 38.5 Puts for $3.55 (4.1 times usual volume) with stock at $34.91
Tag: Options
Is Silver Undervalued? (SLV, GLD, USD) 2.27.2013
The chart of silver may be depicting a buying opportunity with limited risk and a tight stop. Silver is in a down channel, but the current price may be suffering from an oversold condition. The market has seen this movie before. Silver saw a similar slump in December of 2012 where the metal fell over 10% as it traversed from the upper bound of the channel to the lower bound of the channel. The candlestick formation when silver bottomed during the aforementioned period is eerily similar to the ones at the present time. See chart below for specifics, but in essence, they are forming neutral dojis…an early indicator of a bottoming process.
Other drivers of the metals trade include push and pulls from the currency market. Over the same period mentioned above, the US Dollar index has rallied and the EUR/USD currency pair has fallen, giving more reason for the metal weakness. This may soon cycle back to prior levels, but is absolutely a risk to the outlined thesis.
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What Would A Stock Split Mean for Apple (AAPL)? 2.27.2013
Well, a stock split is very straightforward. All it means, in this case, is the price will be chopped in half to $224 and the shares outstanding will double. This doesn’t affect the market cap of Apple, or the value of your current shares. The whole point of doing this would be to allow more investors/traders to pick shares of Apple. The concept of stock splits is no revolutionary idea, they are just a way to create some buzz and allow more people to get their hands on the stock. But hey, when the stock is down 36% in 5 months, splitting the stock might not be that bad of an idea! Can I hear a 3-1 or 4-1 split?
Apples pile of cash is no secret to anyone, as it continues to grow as you read this. But what could they possibly do with $135 billion that could satisfy investors? Increase the yield? Sure, if you own 10 million shares and are seeing these payouts extremely beneficial to your pockets. But for the average investor/trader that is not the case. What would be beneficial is to actually do something with that money, such as innovate and buy up companies that bring value. I truly miss the days where Apple would come out with a breath taking product twice a year. Of course Steve Jobs is gone, but is the vision?! I don’t think so, but its clear an ‘X’ factor is missing.
The meeting tomorrow will hopefully clear the air for everyone, and I do expect Apple to announce a stock split. But, what truly matters here is if Tim Cook is focused on quieting the whining from investors, or, focused on getting that Apple mojo back during the Job days.
Author: Peter Nitso
pnitso@yahoo.com
Twitter: @PeterNitso
S&P Emini Pivot points for 2.21.2013
Rhetoric Aside, Where Does HLF Really Go From Here? 2.19.2013
Investors continue to ask the question… where does Herbalife go from here?
Well, Icahn believes the answer to that question is up. In his most recent appearance on CNBC, Carl said, “I buy things I think are undervalued.” From this statement it’s clear that he’s banking on making money from being long HLF.
I know quite a few investors will take his word and get long HLF as well…but do the charts line up with Icahn’s current view? Lets check it out…
Going back to the lows made in early 2009, it looks like a clear five waves completed in April 2012 at $73. Since that high, there as been a strong reversal, but it was done so in a corrective fashion (three waves). This tells me one of two things… one being that we are going to see a strong reversal right here ($38-$44), to bring us down in a fifth wave completing near the $10-$15 region. The second being that we have bottomed at $24, and will now begin a stronger third wave up that could take a couple years to complete.
When looking at both of these possibilities, the most probable scenario that I see playing out is a third wave up. The MACD is portraying some nice positive divergence, and gives me more confidence that we will see higher levels before we see lower. My initial targets are the $55-$63 region for (iii) of 3 before we see a stronger consolidation in (iv) of 3. By year-end I could even see wave 3 ending up near $72-$80!
When putting counts on a stock, you always need to have stops that invalidate your current position. If the price action falls below the $30.73 that would be my first indication that we are in a fifth wave down, with $23.91 being the nail in the coffin for the bulls. Bulls do not want to see it below that level!!
In the long I am optimistic on Herbalife, and have to say that Carl Icahn might have snagged up a ‘diamond in the rough.’
Author: Peter Nitso
pnitso@yahoo.com
Twitter: @PeterNitso
Andrew Keene on First Business Talking the Yen, HLF, WMT, & the HNZ Situation 2.19.2013
Andrew Keene Talks Deere (DE) Earnings on Bloomberg TV 2.12.2013
LNKD Surges (LNKD, QQQ, FB) 2.8.2013
The options were expecting about a $9.00 move in the stock and according to current prices, the move is going to be outside of that. The ‘at the money’ straddle was just about $9.50 too. Today’s move was basically unlikely, according to what the options were implying yesterday. LNKD is probably going to open up at a new all time high. Bullish fundamentals are paired with bullish management.
Analysts are moving around their PTs. BMO Capital Markets maintained LNKD at market perform, but raised its $130 PT. JEF held on to its buy rating and increased its PT to $170.
AAPL's Cash Hoard 1.25.2013
Now everyone wants to know… do we see more pain in the near future, and/or what could give this monster a spark to ignite a strong rally?!
First, looking at the chart everything is looking bearish right now. The MACD is pointing straight down, the RSI is embedded in the oversold area (23.15), and the recent decline happened on huge volume. Not what you want to see if you’re a perma-bull…. and I know there are plenty of them out there! I would want to see it clear the 200MA to get me back onto the bullish side. That has been a tough obstacle for it, since it hasn’t been on the bullish side of it since October 5th.
When looking at the wave count of Apple, it seems best to label this downside action as (iii) of 5. Leaving us only with one more impulsive wave to the downside, (v) of 5. I am expecting a bounce here very soon, taking us back up to the $480 level before we begin the final sell-off.
But what could spark Apple once we hit the bottom?!
I am looking for some big news to give investors that ‘Apple love’ to jump back on board! What jumps out to me is a takeover of Twitter. Twitter, is everywhere nowadays…. ESPN, CNBC, Discovery Channel, ABC, History Channel, the list goes on and on. But there seems to be hash tags everywhere I look, and there are no signs of slowing down. They are even using hash tags to connect with students in classes here at the University of Oregon!
I know Apple is not known for buying up companies, but this setup is screaming at Apple to take action. My classrooms are filled with student’s texting/surfing the web on their iPhones. It almost seems rare to find someone with a Droid or Blackberry. Apple knows that college kids drool over its products, and I keep on coming back to teachers using Twitter as a way to communicate instantly with their students.
Cash is obviously not an issue for Apple, so that is out of the picture. It really comes down to if Apple has a need for Twitter, but from by viewpoint, it makes perfect sense!
Author: Peter Nitso
Twitter: @PeterNitso
Natural Gas Futures Technical Update (/NG, UNG, CHK) 1.3.2013
The channel break may indicate that lower prices are ahead. A reasonable target could to the September 26th, 2012 gap. This gap is represented in the chart below by the white oval. If one was inclined to take a trade like this, it may be advantageous to sell the UNG ETF. The futures would be an organic way to play price moving down, but the UNG fund has structural problems. The ETF underperforms the future and has a 10-day correlation of only 0.88. This could be explained by the nature of the product.
As displayed below, natural gas has a positively sloped futures curve and as the fund rolls contracts they lose money; put simply.
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