Yesterday was a continuation of bearish momentum in the S&P 500. The only technical note is the oversold/overbought indicators have moved closer to oversold, although they aren’t there yet. However, yesterday’s flirting with the bottom of the Bollinger Bands could be a hint of the next market direction, which would be down. But futures are positive this morning, so expect a move up at the open today. With month and quarter end on Monday, the markets could easily see a bullish move here, as the professionals try to dress up their quarterly numbers. But a Russian invasion of Ukraine could push the markets lower, so sentiment could end up working in two directions. Overall, I lean towards the same kind of market action we have seen lately: Early move up, followed by a fall for the rest of the day.
The S&P 500 levels to watch today:
UPSIDE: 1862-1863 (3 data points and the 20 day moving average), 1867-1877 (14 data points and February’s high), 1881-1883 (4 data points and the all-time high), and 1885 (top of the Bollinger Bands).
LAST CLOSE: 1849, inside the 1849-1858 (10 data points and January’s high and December’s high) range.
DOWNSIDE: 1839-1842 (4 data points and the bottom of the Bollinger Bands), 1834 (March 3rd’s low), 1833 (50 day moving average), 1818 (100 day moving average), 1777 (150 day moving average), 1775 (October’s high), 1770 (January’s low), 1767 (December’s low), and 1747 (200 day moving average).
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Ed's Talking Stock 
PRAN @ 9.69. Forgot to post I bought BLDP yesterday @ 4.27
Out of PRAN for plus 38 3.9%
Wonder what the annualized return is for 3.9% in 8 min? Nice work
Just curious Trader, Why not sell calls against the Stock. The premium should give you a nice return north of 15% for a couple weeks. Just trying to learn?
Jeff, I already have a sizeable position that is covered with April 12 calls. It’s a matter of risk management. As I mentioned the other day, biotech stocks can drop like a rock on a bad news release with no warning. If I can day or swing trade for 3-5% I can minimize the risk of being in big and caught if it goes off the cliff. Those huge premiums are attractive but you have to understand the risk you are taking. I’ll take a 3-5% every day and be happy with the cash in the bank at the end of the day. If my daytrade doesn’t work I always have the option to sell the calls.
Got it. Thanks Trader
Most likely buy UCO today. Watching price now
Bought GTAT @ 17.04 lowering my average to 17.29. Sold April 17 calls for 1.16 reducing my basis to 16.13. If called my profit will be .83 5.1%. If not called I collected a 6.7% return on my position.
Very nice Trader. I was very close to buying another position yesterday but couldn’t pull the trigger. I just sold APril 18C for .95 on the rest of my position. I like you’re move with the April 17 today. My avg price is 17.18. I’ve sold calls at .75 & .95 reducing my basis to 16.33. If called out my return would be 10.2%. I think I might be waiting another month to be called out on this one though, but I still feel the downside is not as great with this one so not worried.
Looks like I jumped the gun on selling the calls. I try to manage this play to give me a minimum 5% return for a month. When I can structure the play to achieve that I take it. I don’t care what it does as long as I hit my goal. I took a more conservative approach by selling in the money calls. If all goes according to plan, I can still achieve my objective.
Yeah it really popped in 17.50 area. Well lets hope it stays a winner for all of us. It will make the first half of 2014 look very good in the plus column.
Jeff are you back in this one or were you still waiting on the sidelines? I thought you might have been called out a couple weeks ago?
back in big time but I have calls on all positions up to 19
hahaha I like the way you phrased that.
BRF @ 28.75 . Not sure if this will be a trade or a hold. If I get a good pop I’ll sell. Otherwise if it looks good to accumulate more I will and then sell calls. Also looking for a long options position. Nothing yet but I will post if I do
I will be glad to put this week behind me. GTAT, LMNS, C, CALL and other names of mine struggled. Still, looking at the wreckage, it isn’t really that bad. I am down 2.7% on the week, but still up 6.4% on the year. No transactions for me this week. I did try to buy some GTAT options, but got shut out.
Marshall would you be buying the insurance companies on this dip?
Marshall, I joined you on GTAT and its been especially good for me. Thanks. In spite of the recent drop, my calls have significantly mitigated the downward bias and helped protect my gains. I thin you mentioned that you tried to buy some calls and could not do so. As you know I only recently started using covered calls to reduce my risk and increase my return. Before I could do so, I had to request this ability from my broker Fidelity. It did take about 3-4 days but they seemed very responsive, (probably because covered call are one of the most conservative options strategies out there).
Thanks once again for your posts and your picks. Next week I’m looking at covered calls for your pick CALL and one of my favorites LNG. Good luck
Bobb – if you have an outlook of two years, met and LNC look cheap. They will fluctuate short term as people wonder about the taper, but longer term interest rates are going up and life insurers will go up with the rates.
Started a small position in MET and will continue to add if their is weaknees