Archive for January 2011

Ed’s Daily Summary for January 31st   23 comments

I had the feeling the markets would be weird today and tomorrow. They didn’t disappoint me (except for the results):

F: -0.32 to $15.95 (-1.97%)–bought at $17.125
INTC: 0.00 to $21.46 (0.00%)–bought at $18.52
JUBAX: NA to $10.75 (NA%)–bought at $10.17
SDOW: -0.61 to $38.63 (-1.55%)–bought at $39.26
SPXU: -0.41 to $18.05 (-2.22%)–bought at $17.57
SQQQ: -0.39 to $28.40 (-1.35%)–bought at $28.75
VXZ: -0.57 to $58.08 (-0.97%)–bought at $58.00

OVERALL: -1.02%

I must admit, I was quite impressed with Intel (INTC) today. If ever a stock had a reason to drop, that was it, yet it still finished at even.


Posted January 31, 2011 by edmcgon in Market Analysis, Portfolio

Update: Intel (INTC)   22 comments

Intel reported a design flaw in one of their chips today, which caused their stock to stop trading. According to Yahoo Finance:

As part of ongoing quality assurance, Intel Corporation has discovered a design issue in a recently released support chip, the Intel® 6 Series, code-named Cougar Point, and has implemented a silicon fix. In some cases, the Serial-ATA (SATA) ports within the chipsets may degrade over time, potentially impacting the performance or functionality of SATA-linked devices such as hard disk drives and DVD-drives. The chipset is utilized in PCs with Intel’s latest Second Generation Intel Core processors, code-named Sandy Bridge. Intel has stopped shipment of the affected support chip from its factories. Intel has corrected the design issue, and has begun manufacturing a new version of the support chip which will resolve the issue. The Sandy Bridge microprocessor is unaffected and no other products are affected by this issue.

But the funny thing is that even with this news, they revised their 2011 revenue growth expectations upward (of course, they took a charge to their 4th quarter 2010 earnings…), although they revised their gross margins down a few percent:

The full-year revenue growth percentage is now expected to be in the mid-to high teens, compared to the company’s prior expectation of approximately 10 percent. Full-year gross margin is now expected to be 63 percent, plus or minus a few percentage points, compared to the previous expectation of 65 percent, plus or minus a few percentage points.

Intel still looks solid for 2011. I don’t see this as a reason to change my outlook for it, and I am not selling. If anything, I would call this an opportunity for anyone who doesn’t have Intel to buy it.

Posted January 31, 2011 by edmcgon in Portfolio, Stocks

Update: iPath S&P 500 VIX Mid-Term Futures ETN (VXZ)   4 comments

I have added a sell limit order on iPath S&P 500 VIX Mid-Term Futures ETN (VXZ) of $104.32, which is the 52 week high on it. I honestly don’t expect it to reach that high, but I will be delighted to sell it if it does. However, I expect to sell it later this week regardless.

Posted January 31, 2011 by edmcgon in Portfolio Moves

Ed’s Daily Notes for January 31st   16 comments

1. You didn’t think I would do anything without discussing Egypt, did you?

Here is a fact to keep things in perspective: According to the International Monetary Fund, Egypt’s GDP in 2010 was $216.83 billion. By comparison, Greece is worth $305 billion in GDP. Exxon’s market cap is $398 billion. In other words, if something went wrong with Greece or Exxon, we would have bigger problems.

Mind you, I am not diminishing the importance of Egypt politically. Egypt’s peaceful relations with Israel have helped to keep a cap on Middle Eastern tensions. But even if the Middle East turned into a war zone tomorrow, do you honestly think the world’s developed nations wouldn’t be in there the next day to fix things? Heck, even China and the U.S. would find common ground to take action together.

2. Speaking of Exxon, their quarterly profits went up 53%. Top that, Jed Clampett…

3. If you can pull yourself away from news about Egypt, there will be some important economic reports this week, with U.S. jobs taking center stage:

TUESDAY: Auto and Truck sales.
WEDNESDAY: ADP’s Employment Change.
THURSDAY: The weekly unemployment claims will stand out just a little more this week, because on…
FRIDAY, we get the unemployment rate for January.

4. In other U.S. economic news, personal income was up 0.4% in December, but personal spending was up 0.7%. Core PCE prices were unchanged. All in all, a net positive month. This is why I think we are in a market correction, and not a full-blown bear market.

Posted January 31, 2011 by edmcgon in Economy, Market Analysis

Open Thread   75 comments

After a day like today, you folks need an open thread. And what better song to lead it off than Tom Petty’s Free Fallin’?

If music videos aren’t your thing, maybe a good cartoon?

Enjoy your weekend!

Posted January 28, 2011 by edmcgon in Open Thread

The end is here! Ed’s Daily Summary for January 28th   13 comments

No, it is just the end of the week, not the world. Although I can forgive anyone for making that mistake, after today’s horrendous market action.

F: -2.52 to $16.27 (-13.41%)–bought at $18.05 and $16.20 today for a new dollar cost average of $17.125
INTC: -0.29 to $21.46 (-1.33%)–bought at $18.52
JUBAX: NA to $10.93 (NA%)–bought at $10.17
SDOW: -0.01 to $39.24 (-0.00%)–bought at $39.259 today
SPXU: 0.92 to $18.46 (5.25%)–bought at $17.57
SQQQ: 0.04 to $28.79 (0.14%)–bought at $28.75 today
VXZ: 1.79 to $58.65 (3.15%)–bought at $58.00

OVERALL: -0.72%

Posted January 28, 2011 by edmcgon in Market Analysis, Portfolio

Buy Proshares Ultra Pro Short QQQ (SQQQ)   23 comments

Now for the final piece of the trio, the Nasdaq. For that one, I am adding Proshares Ultra Pro Short QQQ (SQQQ) with a limit buy order of $28.50.

UPDATE: I chased it and got it at $28.75.

Posted January 28, 2011 by edmcgon in Portfolio Moves