Wednesday, April 2nd, 2008
I got into Valero and Tesoro last week and both are up double digits as well as selling calls on them has increase profits significantly so I’m winding down the trade now. They have ran more than the market but not more than the financials which seems a little over done to me.
My suggestion is that the financials are not at a bottom yet. I was short Citibank through putts which have lost value the last couple days but it was a safe hedge so the loss was more than offset by the refiner trade.
I think the next trade may be shorting gold related stocks when they rally a little bit. I should have thought of this before but didn’t even come to mind. What a dope! But I still need more research.
As for the market, it’s been a nice rally but be aware of this Friday’s jobs report that may ruin everything as all the markets are headed toward resistance again but slight higher though which may signify bottom but I believe it’s a fake rally. Not all the earnings have been marked down yet especially with a recession coming. I will write a post about inflation soon. The resistance levels are as follows:
DOW - 12,800 S&P - 1,420 NAS - 2,440
They are getting close so buy those putts for safety. Selling calls at this moment doesn’t seem worth while as volatility is down.
Btw, I had a comment about the Nymex trade which I did take a small loss because I’ve been selling $3 calls for the six months that I was holding it. Almost $20 in profit so that lowered my risk but I still managed a loss. Yes it was a bad trade for one huge reason. There was no edge on the trade as all the information as available and not catalyst but I still think if the market wasn’t spiraling to it’s death, the deal would have gone through at plus $140.
Good luck trading.
Currently holding: Long VLO, Short GRMN, C
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Monday, March 24th, 2008
Ok I just watched Fast Money and I’ve decided that the refiner trade is going to be my next move. I’m pretty short now but still I have to hedge those shorts but this short will have to go against the grain as oil goes down, refining margins go up. Like last year, the refiners ran up last year with the crack spreads going up but it looks like it may run up again but there are a lot of factors that may contribute to the raise.
1. Oversold
2. Rising Crack Spread
3. Higher Short Interest
The three subject stocks are Tesoro (TSO), Valero (VLO) and Frontier Oil (FTO) I don’t expect the stocks to go too far lower as they are all hitting lows and support levels. See the charts below. I’m debating about which stock to purchase as I plan to sell some upside calls just in case. Or perhaps just buy some calls strategically. Still up in the air. See the charts below. I played with one of them as you see the trends and the supports.
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Wednesday, October 17th, 2007
Ok first of all, sorry for the lack of updates but I plan to revive the site and revamp it soon. This site was mainly for fun and to help share ideas with everyone. But I’m going redo the look and make it simple and more blog like instead of this insanity. Ok here are some stocks to look for. On Fast Money, Dennis Gartman, famous commodities trader revealved that they are buying natural gas and he suggested some picks such as UNG, the natural gas ETF saying that it’s forming a base. San Juan Basin Royalty Trust, SJT and Pengrowth Energy Trust (PGH) were two picks that are Canadian energy trust which pay 8% and 15% dividend respectively. So he says they track natural gas pretty well so I guess it’s worth a look but it’s very volatile. Those are just some ideas. Trade carefully.
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