Wednesday, May 14, 2008

Are big boys still sitting tight?

It was mysterious, yet like a clock work, at exactly 2:30 pm, the first round of sell-off was launched, followed by several rounds of dumping on even higher volumes. For both DOW and SP500, it appears that the bearish engulfing candles on the weekly charts asserted their power at the last moment. As for NASDAQ, well, the underlying momentum just had to drive it up to its MA200. Or, are big boys done the sitting as they cannot help but come in to reap the fat call premiums they had built up for days? Things are getting really delicate now, we all know that bulls have more lives than a cat, but do we know what big boys are up to after sitting tight for weeks?

Looks like I got it just wrong when it comes to how to play CTRP and SINA ER, not sure if the cushion I gave to CTRP will be sufficient tomorrow.

If the market gaps up/spikes up tomorrow morning, I may short AAPL, BIDU, GOOG. On the long side, I will keep an eye on PCLN and RIMM.

8 comments:

pcaguy said...

Wildest day yet.
Closed BYI put position too early -BYISI I sold 29 contracts at $4.7 about 6 cent profit.
OIH:
Closed 15 -OIHGT calls early sale at $16 when OIH was $207; cost was $13.59 bought at yesterdays close (OIH 202.42).
Bot 60 -ODLSD puts at today's close (OIH $208.9) average cost is $18.02
Bot 20 -OIHGS calls mid day when OIH was $203 at a cost $16.80
PKX:
Bot 10 Aug 155 put -PKXTK at $19.27 when PKX was about 143.
LEAP:
Bot 5 July 70 puts -UAOSN at $10.62 cost
SINA:
Bot 5 Sep $65 puts -NOQUM at $11.72 cost.
UNG:
Bot 5 July 45 calls -UNGGS at $9.42 cost.
These energy stocks are reversing direction each day which makes for big opportunities in swing trading.
I closed out my previous long 45 contracts OIH calls and long 30 contracts puts yesterday for good profits and then they sold the OIH down to $202.42 in the last hour so I bought oihgt calls cheap which were a winner first thing this am.
Options expiration tomorrow so this could get more exciting yet. I will miss a good part of the day, dang it.
PCA GUY

flyingwabbit said...

pca guy:
boy, lots of good trades, and you are trading like crazy! r u trading full time? I notice that your holding time is usually quite short, is there any particular reason? You see, I have not done much options until not long ago, and part of the drive is trying to avoid DT and at least hold for a 3-10 day swing just like Razor, but so far, except a couple of cases, most were either DT or overnight plays....

pcaguy said...

This has been one of my best weeks. I have lost on many of these puts trades before so I know I will be giving back.
The OIH PUTS I bought at the close yesterday will be big losers at the open Friday.
I suspected I was wrong to do it. But, I could not pass up the chance to go short the OIH at $209 when I bought OIH calls at $202.60 earlier this week and $204.5 yesterday.
So my current position is long 20 calls and long 60 puts.
I think the trade will be to sell my calls at the close and look to add to my puts also at the close.
I really look to hold overnight and close out within a few days on Puts.
On my long plays 25 calls of DE bought on 5/14 (-DEIN, 14.49 Sep $70 strike) UNG yesterday and BRL last week my hold times are considerably longer.
OIH:
Previous history is that on a strong OIH open on options Friday they will bid OIH up all day. So if you are going to buy puts on OIH today you might wait until the last half hour.
PCA Guy

pcaguy said...

Picked up 29 more contracts of -ODLSD July $220 strike puts at $14.50 cost when OIH was $215. I think they will run OIH up through the day but I had to pull the trigger with OIH at $215.
I think the Jersey boys may run this up to $220 by 4 pm but I had to average down. Average cost is $16.87 on 89 contracts.
Closed SINA puts with a nice profit. Under water on PKX puts and in small profits on LEAP puts.
PCA GUY

RazoR said...

Sold half position in drys for 17 pts. Will hold the rest for mon er 120 anybody?
Holding solf common from 18, bought some put protection at 20, hoping for 25 squeeze anyone?
Still holding V avg price 81...
Tonights drinks are on me only if the Lakers win....
RzR

pcaguy said...

Does DRYS ever go down ?
Closed out PKX puts at a loss. Steel sector just looks too strong. Closed SINA and LEAP puts at a profit. Bot some additional UNG, still long DE and BRL.
OIH:
They closed OIH at $215 which is an all time high. Goldman manipulated this baby by announcing that their outlook for crude is now $ 141 for the summer. How convenient that it was also options expiration.
OIH:
At the close bought 200 of -ODLSF July $230 strike puts for an average cost of $20.87
Added 30 more -ODLSD July $220 strike puts for a total of 90 at an average cost of $16.85. This made my buy of 60 at yesterday's close a big loser.
Sold 20 -OIHGS July 195 calls at $24.50 for a $7.7 winner.
Oil can be strong into next Tuesday before I get a break.
The Jersey Boys may try to hold these gains through Monday to give the impression to the SEC that they are not gaming the market at expiration date. After that there should be a break back down to $208-$206 on the OIH which will make all of my Puts nice winners.

Moral: Never short materials stocks into expiration.
PCA GUY

RazoR said...

no, drys never goes down lol, it reminds me of a game of chicken, James Dean racing towards the cliff at 60mph....also initiated a strangle on nvda, I am determined to make gains on this rotten snail...

flyingwabbit said...

razor:
rotten snail? what exactly were you saying here? have a good weekend!