Traders Corner   19 comments

S&P 500 futures are up this morning, but I am not reading too much into it. It looks like we could get a dead cat bounce today, as the bottom of the Bollinger Bands catches up with the falling blades. Don’t be surprised if an early move up fades into the close today, or even completely reverses.

The S&P 500 levels to watch today:

UPSIDE: 1810 (bottom of the Bollinger Bands), 1812 (50 day moving average), 1815 (January 13th’s low), 1820-1821 (2 data points), 1823 (January 6th’s low), 1826-1832 (8 data points), 1835 (January 17th’s low and the 20 day moving average), 1837-1840 (7 data points), 1843-1847 (7 data points), 1849-1850 (January 21st’s high, December’s high and the all-time high), and 1861 (top of the Bollinger Bands).
LAST CLOSE: 1790 (January 24th’s low).
DOWNSIDE: 1775 (October’s high), 1767 (December’s low), 1746 (November’s low), 1729 (September’s high), 1709 (August’s high), and 1701 (200 day moving average).

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19 responses to “Traders Corner

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  1. Bought ARIA this morning at 9.47. Daytrade if it moves enough. Another one with huge call premiums.

    • I think the high premiums are due to the huge move on Friday as a result of buyout rumors (and as a result the high implied volatility. On Friday, it looks like the implied volatility jumped from around 60-70% to around 130%). Glad I decided to get into options for this stock earlier last week! Definitely hoping that keeps going higher…

      • That makes two of us. It has an interesting chart. If you look at a daily chart for the last three months it jumps big and then consolidates and repeats. If it consolidates again, I’ll look at selling calls closer to the Feb expiration date. Should be ok as long as it doesn’t tank.

  2. I see where GAME got a buy-out offer today for 6.90. This is a stock that I unfortunately sold in September for 3.91. It is interesting in that the stock spiked pretty sharply last week (despite EM sell off) by 31% on 2 to 3x normal volume. They are up another 12% today. I would suggest someone had heard at least a rumor that this could happen.

    • Asymmetric information. The game is definitely rigged.

      Robb

    • You’re not alone Marshall. I played that one for a quick swing from 4.09 to 4.60 when you pointed it out last week(thanks!) looking for the quick rebound. Wish I wouldn’t had set that limit order now. But oh well. Def looks like someone else had information on that one when you glance at the charts.

  3. Ed – good move to sell NTE. I saw they posted revenues down 25% today and are trading down about 13%.

  4. Oops, ARIA tanking. Glad it was a small position. Looks like I’m heading for a workout.

  5. I have decided to go with a hedge today. I have ought TWM, which is a 2x short of Russell 2000 at 50.45. This is not an investment, but rather (in my view) some insurance. If markets do tank, this will give me some capital for investing at lower prices. If markets go up, well I am still better off overall. It is a large position, actually my single largest position, about 10% of my portfolio. I picked the Russell 2000 and that is smaller growth stocks and I feel that is the segment of the market that is most extended. As a final note, I have an extraordinarily poor record in picking these things.

    • Marshall, I feel your angst. I also have terrible luck with these leveraged etfs. However, I like your thought process here. Good Luck

  6. The last few days have been brutal. CTRP and GOGO are down big for me.

  7. Sold my FGL today at 19.80. The gain was enough to pay for the transaction costs with enough left over to buy a medium skinny mocha at Starbucks (but not a large). FGL was always intended to be a short term trade.

    • I followed your lead and believe I made enough for the large. Thanks for the tip — any tip that ends up in the green is a good tip.

  8. Generally shitty day. Didn’t buy anything and didn’t sell anything. However, I am thinking of joining marshall in twm since I think the Fed is still going to cut another $10 Billion from the QE on Wednesday.

    • It was a weird day for me. I did end up making a bit, helped a lot by GTAT being up 6.4%. I do not have the mentality to put 10% in a leveraged short. It makes me very nervous and I was watching it continuously – even if my rationale was sensible. I will likely sell it by end of the week.

    • I’m guessing that any big pop in twm would happen after 2pm ET on Wednesday if the Fed announces that it will decreases QE again. You may want to consider leaving the trade then and not wait till Friday.

    • For what it’s worth, I plan to be out of SPXU before any Fed announcement. I may be back in it afterwards, but at least I’ll be in it with my eyes open.

  9. Figure this correction will go farther but added some VWO and EEMV to my long term IRA portfolio and added back some RIG to one of my margin accounts.

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