Stop me if you've heard this one before: UA - Bought Under Armour September $60 calls at $1.00/contract today. What follows is the exact verbiage from my previous UA purchase. This was a purely technical play. I am a member of iBankCoin's PPT trading website. It is quite honestly one of the most useful tools I have come across and worth every penny. UA flagged in The PPT algorithms as Oversold. The stats said that the previous 10 times that had happened with UA the stock had turned around for an average return of better than 10%.
Today the stock is trading in the $56 range, and looks to be 'resting' for it's next leg higher. Since the PPT implies seeing $60 or $61 in the next two weeks, the Sept $60 calls should just about be a sure thing. Of course, weak numbers from either Dick's (announces Q2 tomorrow, August 14) or Foot Locker (announces Q2 Friday August 17) could jack this play up. At that point I will re-evaluate the position and may double down.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
Monday, August 13, 2012
Earnings Play: MRVL
Marvell Technology reports second quarter results after the market close on Thursday August 16. In anticipation of what some smart money (and my independent research) is anticipating to be a good news quarter, I purchased the September $13 call options for $0.38/contract.
Target is $1.00/contract either in the run-up to earnings or in post-earnings action.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
Earnings Play: JCP
JC Penney's is in the downward spiral. Painfully obvious. They made a strategic move earlier this year to get away from what had become constant sales. Their customer base did not appreciate this move. They signed Ellen Degeneres as lead spokesperson. Their customer base did not appreciate this move. Seemingly every thing this once great american retailer does has blown up in it's face. JCP was set to report second quarter results prior to the market open on Friday August 10.
With this in mind, I bought the August 22 put options right before the market closed on Thursday August 9 at $1.52.
And as expected JCP reported disastrous results for Q2. And essentially admitted that as bad as that was, worse was likely to follow. The stock should have tanked and I should have banked coin. Sadly that was not meant to be. After dropping 6% in the pre-market, JCP turned it around and ended Friday up 5.88% (off of a high of $24.57 or 11.1% gain). This is what makes the market so much fun (and so endlessly frustrating!). No matter what the logical response should be, one just never knows how the market is going to handle news.
The bear case is still very much in force for JCP, so I have doubled down on this bet by purchasing the September 22 puts at $1.05. Having until September 21 for my thesis to be proven correct should allow me to exit these two trades at least flat, hopefully with a profit.
In hindsight, I should have opened with the September puts. The August puts expiration is just too close for me to able to work off bad price movement. So be it, lesson learned.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
With this in mind, I bought the August 22 put options right before the market closed on Thursday August 9 at $1.52.
And as expected JCP reported disastrous results for Q2. And essentially admitted that as bad as that was, worse was likely to follow. The stock should have tanked and I should have banked coin. Sadly that was not meant to be. After dropping 6% in the pre-market, JCP turned it around and ended Friday up 5.88% (off of a high of $24.57 or 11.1% gain). This is what makes the market so much fun (and so endlessly frustrating!). No matter what the logical response should be, one just never knows how the market is going to handle news.
The bear case is still very much in force for JCP, so I have doubled down on this bet by purchasing the September 22 puts at $1.05. Having until September 21 for my thesis to be proven correct should allow me to exit these two trades at least flat, hopefully with a profit.
In hindsight, I should have opened with the September puts. The August puts expiration is just too close for me to able to work off bad price movement. So be it, lesson learned.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
Wednesday, August 8, 2012
DNKN - After Action
This is my after action report for DNKN.
**Quick disclaimer: as I just started this blog, there will be several entries that are only after action, as I had already purchased the shares. I am not trying to make myself look better than I really am by only reporting good trades. I will put every trade I make on this blog, good or bad.**
DNKN was bought March 9, 2012 at $30.74. This trade was entered based on a the cup and handle formation that was formed from Oct to Feb (cup) and mid-Feb to March (handle). The buy was signaled on a breach of the $30.25 level.
DNKN was sold on August 2, 2012 at $28.76, for a loss of $1.98/share or -6.44% before commission and taxes. The sell was made as I finally pulled my head from my ass and realized that this stock had turned against me and would not be returning to profitability any time soon. This was a great example of laziness and lack of discipline on my part.
The sell should have been made on July 20, when the upward trend line was broken. That would have been somewhere in the $33 range, which would have been a nice 10% or so profit (before t&c). Looking back at this I simmer in rage at my inablility to do the right thing here. The signs were obvious, just lacking execution on my part. The only positive to take away from this is that I did finally wake up and pulled the plug without further damage to my capital.
I would rate myself 4/10 on this particular trade. I followed my position sizing guidelines and obeyed my risk rules. I had sound reasoning for my entry but totally screwed the exit up. By not executing the exit properly I turned a winner into a loser. The key will be to make sure that I learn from this mistake and not repeat it in the future.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
Tuesday, August 7, 2012
GMCR - Purchase
Bought GMCR September $20 puts at 1:57 pm August 7, 2012 for a price of $1.00.
Green Mountain Coffee Roasters, Inc. engages in the specialty coffee and coffee maker business. The company sources, produces and sells approximately 200 varieties of coffee, cocoa, teas and other beverages in K-Cup portion packs and coffee in traditional packaging (from Yahoo! finance).
The bear case still exists and is quite strong for this company. My belief is this will see $18 before it sees $28, and these puts are a low-cost/low-risk way to play the short. My target is $3.00/contract, my protective stop will be at $0.50/contract.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
UA - Sell
Sold the UA August $55 calls for $3.40 at 11:54am August 7, 2012. The purchase was described here.
The gains for this transaction were $2.30/contract or 209.1%. This trade went exactly as planned. There exists the possibility that these contracts will continue to run higher, but the odds were not great enough that it was worth violating my exit plan. The underlying stock touched above $58 today, which as I explained in the purchase piece was where I thought it would go. The stock has made quite the run over the last couple of days becoming a little over-extended. The greater probability over the next couple of days is for sideways, possibly corrective price movement. Given the time-sensitive nature of options, the time to exit was now.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
The gains for this transaction were $2.30/contract or 209.1%. This trade went exactly as planned. There exists the possibility that these contracts will continue to run higher, but the odds were not great enough that it was worth violating my exit plan. The underlying stock touched above $58 today, which as I explained in the purchase piece was where I thought it would go. The stock has made quite the run over the last couple of days becoming a little over-extended. The greater probability over the next couple of days is for sideways, possibly corrective price movement. Given the time-sensitive nature of options, the time to exit was now.
I would rate myself 9/10 on this particular trade. I followed my position sizing guidelines and obeyed my risk rules. I had sound reasoning for my entry and nailed the exit. There is a small chance that I left money on the table, however I am completely satisfied with a three-bagger.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
WFM - After Action
This is my after action report for WFM.
**Quick disclaimer: as I just started this blog, there will be several entries that are only after action, as I had already purchased the shares. I am not trying to make myself look better than I really am by only reporting good trades. I will put every trade I make on this blog, good or bad.**
WFM was bought June 19, 2012 at $95. This trade was entered based on a new high in prolonged up-trend, combined with the possibility for the $100 dollar roll and the probability for excellent quarterly results.
WFM was sold on July 20, 2012 at $84.86, for a loss of $10.14/share or -10.6% before commission and taxes. The sell was triggered as there appeared to be a complete character change in this issue. I was taken off guard by the correlation that this stock ended up showing with CMG. On July 19 CMG announced in the market after hours quarterly results that were disappointing. WFM had already been showing some weakness that whole week. Not enough to sell yet, mind you as the trend line was still intact and my call for a strong quarter was still in play. Nonetheless, the poor quarter by CMG helped to push Whole Foods off the cliff. In a logical world, poor results in the restaurant should not have this tight of correlation with the grocery business. Certainly there is a relationship, but WFM should have seen a minor dip, not the major correction it did. Regardless, I should have handled this one better. Once the 50 day was crossed (on July 19), I should have bailed, which would have saved me some capital.
The other mistake I made with this one was that as I recovered I thought that the August call options would have been an easy play to regain some of my capital. This would have been the right play as my thesis of strong quarterly results was still in play. Indeed given the four day beating this stock took, the calls were cheap and then took off like a rocket when the quarterly results were announced. Unfortunately life conspired to keep me out of that trade, so I missed it.
I would rate myself 4/10 on this particular trade. I had sound reasoning for my entry but let the exit get away from me. I followed my position sizing guidelines and obeyed my risk rules.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
ALJ - Sell
Sold ALJ at $12.00 at 9:30 on August 7, 2012. The purchase was described here.
ALJ jumped this morning on the news of the Chevron refinery fire in California last night. This triggered my existing limit order to hit at the opening bell this morning. As detailed in the purchase piece, this was my targeted exit price. The gains for this transaction were $2.50/share or 26.34% before taxes and commissions.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
ALJ jumped this morning on the news of the Chevron refinery fire in California last night. This triggered my existing limit order to hit at the opening bell this morning. As detailed in the purchase piece, this was my targeted exit price. The gains for this transaction were $2.50/share or 26.34% before taxes and commissions.
I would rate myself 9/10 on this particular trade. I followed my position sizing guidelines and obeyed my risk rules. I had sound reasoning for my entry and nailed the exit. There is a small chance that I left money on the table, but I think the likelihood is for a pull back in the next couple of days in ALJ.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
Monday, August 6, 2012
Lazy Jade Ranch
I have been lackadaisical on this blog lately. For that I apologize to the two of you whom might actually read this. Let's get caught up, shall we?
AAPL - Bought Apple at $613.96 on July 20. This stock was basing heading into earnings. I am not going to lie, I was looking for a wicked earnings jump, but knew that even if the quarter didn't blow everyone away, the stock would recover and continue upwards. Too many people are just too in love (no msft) with this stock for it to travel downwards for too long. And sure as I am sitting here, it "tanked" on earnings (it dropped $25.95 or 4.32%). And don't think I wasn't sweating that. It had already moved a little against me heading into earnings. I decided to hold on for the next day to see if there would be follow through or people jumping in to buy. The buyers jumped in and we are (as of this exact moment) 8.5% off that low closing. We're reaching into all-time high territory here, so it will be interesting to see what happens and where AAPL goes from here.
WFM - Sold Whole Foods at $84.86 on July 20. There will be a separate after action report in the very near future on this one.
UA - Bought Under Armour August $55 calls at $1.10 on August 1. This was a purely technical play. I am a member of iBankCoin's PPT trading website. It is quite honestly one of the most useful tools I have come across and worth every penny. UA flagged in The PPT algorithms as Oversold. The stats said that the previous 10 times that had happened with UA the stock had turned around for an average return of better than 10%. At the time the stock was printing a big red candle stopping on $53.50 for the day. Since the PPT implied seeing 58 or 59 in the next two weeks, I determined that the August $55 calls were about the closest one will get to a sure thing in this game. And once again the SHOMP (Sublime Harmonics of Mathematical Precision) ruled the day.
DNKN - Sold Dunkin Donuts at $28.76 on August 2. There will be a separate after action report in the very near future on this one.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
AAPL - Bought Apple at $613.96 on July 20. This stock was basing heading into earnings. I am not going to lie, I was looking for a wicked earnings jump, but knew that even if the quarter didn't blow everyone away, the stock would recover and continue upwards. Too many people are just too in love (no msft) with this stock for it to travel downwards for too long. And sure as I am sitting here, it "tanked" on earnings (it dropped $25.95 or 4.32%). And don't think I wasn't sweating that. It had already moved a little against me heading into earnings. I decided to hold on for the next day to see if there would be follow through or people jumping in to buy. The buyers jumped in and we are (as of this exact moment) 8.5% off that low closing. We're reaching into all-time high territory here, so it will be interesting to see what happens and where AAPL goes from here.
WFM - Sold Whole Foods at $84.86 on July 20. There will be a separate after action report in the very near future on this one.
UA - Bought Under Armour August $55 calls at $1.10 on August 1. This was a purely technical play. I am a member of iBankCoin's PPT trading website. It is quite honestly one of the most useful tools I have come across and worth every penny. UA flagged in The PPT algorithms as Oversold. The stats said that the previous 10 times that had happened with UA the stock had turned around for an average return of better than 10%. At the time the stock was printing a big red candle stopping on $53.50 for the day. Since the PPT implied seeing 58 or 59 in the next two weeks, I determined that the August $55 calls were about the closest one will get to a sure thing in this game. And once again the SHOMP (Sublime Harmonics of Mathematical Precision) ruled the day.
DNKN - Sold Dunkin Donuts at $28.76 on August 2. There will be a separate after action report in the very near future on this one.
This material is provided for informational purposes only, as of the date hereof and is subject to change without notice. This material may not be suitable for all investors and is not intended to be an offer, a solicitation of any offer to buy or sell any securities. Following me in trades will lose you money.
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