Traders Corner   28 comments

Pre-market movers

UP: TSLA
DOWN: AAPL, AMZN, FB, SDRL, VZ

S&P 500 Daily Momentum: Bullish (weakening, almost neutral)
S&P 500 Daily Overbought/oversold: Neutral
S&P 500 Weekly Momentum: Bearish (weakening)
S&P 500 Weekly Overbought/oversold: Neutral
S&P 500 Futures (June): Slightly negative
Overall: The S&P 500 seems to be in it’s “happy place”. Since March 4th, it has moved up 0.09%. Since then, we have seen a low of 1814 and an all-time high of 1897. Until we get some big news, the play seems to be to short the highs and go long on lows.

The S&P 500 levels to watch today:

UPSIDE: 1878 (3 data points), 1883 (May 6th’s high and March’s high), 1885 (May 5th’s high), 1888-1889 (2 data points), 1891 (May 2nd’s high), 1897 (April’s high and the all-time high), and 1904 (top of the Bollinger Bands).
LAST CLOSE: 1875.
DOWNSIDE: 1870 (May 8th’s low), 1866-1867 (2 data points and February’s high and the 20 day moving average), 1865 (50 day moving average), 1859 (May 7th’s low), 1849-1850 (January’s high and December’s high), 1841 (100 day moving average), 1834 (March’s low), and 1827 (bottom of the Bollinger Bands).

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28 responses to “Traders Corner

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  1. marshall, hoping your operation went well. Are you looking at GTAT this am?

    • Jeff, technicals on GTAT are very weak. Might be best to wait for some strength.

      • I am waiting and expect I’ll have to wait till at least Monday

      • Bought to close my May 17 GTAT calls for .05 yesterday. I agree with Trader on this Jeff. The stock looks weak today. We all are waiting for the bounce to sell calls again. If I can sell the May 17’s again for .15 I will take the opportunity.

      • Call premiums have dropped. Tells me lower expectations at least for the short term. If you like the company and don’t mind holding long term, the covered call strategy will still work. The returns just won’t be as high. I’m going to hold my position to see if we get a bounce before I sell calls again. I’m hoping for 15-16.

    • No. I believe good time to initiate a GTAT position, but for me it is a 9% position. For me right now I want to retain my 29% cash position. FGL is also selling off post their earning last night. I believe in part because they were misleading in their BV per share and earnings per share last quarter. I am glad I pared my positions in FGL and GTAT prior to both earnings calls.

      I did not hear anything interesting or new on GTAT call. I think AAPL pretty much has them in an ironclad nda, so GTAT is extremely mum.

  2. TZA @ 18.68. Smaller position. TZA is at recent highs. Don’t want to go all in until I see if it breaks out.

  3. With my GTAT CCs my basis in 3 equal tranches of shares is 14.97, 14.44, and 17.23. Still losses, but far less with the CCs. I should have started using CCs along time ago. They definitely help me stay calm in a storm.

    • Better late than never. 🙂 Very valuable tool in a flat or down market.

    • Once again, thanks trader. The only downside is illustrated by my AAPL trade. I thought that I would try to chip away at my basis in my AAPL shares from about 555 to try to get them down to about 528. Sold some 535 calls for about $11 and then lo and behold AAPL had great earnings and implemented all that Shareholder value shenanigans and the shares shoot up to 580 just before expiration. I was forced to sell the shares at a small net loss.

      Since then I’ve have diligently tried to sell calls such that I always have at least some profit if they get exercised, even if I have to go out longer term to get the premium I need to get to that profitable potential exercise.

      Live and learn.

  4. For anyone looking for long-term safety with a nice dividend, I would refer you to Nuveen Quality Preferred Income Fund (JTP). Even during all the recent market craziness, this stock has maintained a very nice chart. It pays a monthly dividend with a 7.4% yield. On top of that, it is selling at a 9% discount to NAV. Even today, it is the only stock I have that is up.

    • Hi Ed,
      JTP safe for retired to park some funds for a couple of years?
      Thanks.

      • George, you should know two things about JTP in considering its safety for retirees over “a couple years” to help you decide. First is that it is a leveraged, closed end fund. Like all such funds, it borrows money to reinvest at (hopefully) higher yields than its cost to borrow those funds. That’s the leverage side. Historically, leverage adds risk, particularly in times of financial crisis. Look at how CEFs did during 2008-2009 and you’ll see they can be volatile during such periods. Second, they are generally not suited as trading vehicles and many have lock up periods that prevent selling within 90 days of purchase. Nuveen’s website offers the following about this particular fund: http://www.nuveen.com/CEF/Product/Overview.aspx?FundCode=JTP

      • BB,
        If we have a black swan event, like in 2008-2009, then you’re right. If we don’t, JTP should hold up just fine.

  5. GTAT is sitting on its 100 day ma which has been support for the last 12 months. Hope it holds again. 150 is 11.92

  6. bought GTAT at 13.2

    • For a trade or longer term hold?

    • followed you at 13.22.

    • definitely for a trade. I do not think I am holding overnight. I’ve got enough GTAT

      • I’ve been looking at GTAT as a daytrade. What I don’t like is that it is opening at or close to its high for the day and then moves lower and closes at or close to its lows for the day. It has enough volatility to daytrade, but I would like to see some positive price action to improve my odds. If a daytrade doesn’t work then my odds are better for a swing trade.

    • Jeff, r u keeping it over the weekend?

      • I had to do a little work on a rental property which went a little long so I guess I am holding over the weekend. Price is where I bought it at closing, 13.20. Crossing fingers and toes over the weekend though. Trader had a smart comment above. Not good that the stock closes at around its lows. Sorry lynn if I led you astray.

      • Jeff, no need to apologize. Everyone is responsible for making his/her decisions. Have a great weekend everyone. Hopefully next week will be better.

  7. Good luck Lynn. I bought dtv during lunch at 87.11 as a speculative play.

    • Thanks Marshall. Luck is not on my side lately. How r u feeling?

      • GTAT has been a battleground stock. Nothing has really changed about their story. I am feeling ok, but leg is very stiff/sore. Pretty much just laying in bed catching up on GoT.

    • Get better Marshall. About 5 years ago I had a similar injury at Red Lodge Montana. Saw the back of my ski in front of my face. Not good. But I am skiing again. However, no more black diamonds. Nice gentle slopes and no moguls work just great for me.

  8. Thanks so much border bender on the JTP feedback.

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