Yesterday, Rick appeared on The Keiser Report. Rick and Max discussed Goldman’s death dive and MF Global’s crimes against the markets. Rick’s segment begins 12 minutes and 55 seconds into the video.
Gold and Silver were getting pounded in the middle of the night, although index futures were down only enough to suggest that Da Dirtballs were shaking out sellers. Their by-now-familiar trick is to make certain that the contracts they’ve stolen from widows and pensioners in the wee hours can be short-squeezed higher with almost no resistance before the opening bell. The (small) gamble is that sunrise will not bring word of Europe’s demise.
With the E-Mini S&P hitting our rally target in the final moments of Friday’s session, we bought four QQQ Jan 54 puts or Jan 53 puts, respectively, for 0.96 or 0.74. These are keepers, since just about anything could happen between now and January 20 when the options expire. Do nothing further for now. _______ UPDATE (11:02 a.m.EST): In the chat room a moment ago, I suggested cashing out half of the puts at current prices: 1.16 for the Jan 54s, 0.91 for the Jan 53s. That leaves us with two puts at either strike and a profit adjusted cost basis for each, respectively, of 0.76 and 0.57. Let’s spread off the risk by turning the positions in calendar spreads, shorting a December put for each Jan 54 put or Jan 53 put you currently hold. Do so in a 1:1 ratio, and shoot for putting on the spread for “even” or better. What this means is that you will short the puts for the cost basis of the puts you now hold, selling December 53 puts for 0.57 (currently trading for around 0.09) and December 54 puts for 0.76 (currently trading for around 0.18).
Although the course of action suggested above may seem very conservative, it is essential that we nail down partial profits on option positions when possible, particularly on puts that have “come in.” In the several decades that exchange-listed puts have been offered, instances in which put holders enjoyed more than three consecutive pleasurable days have been non-existent. I would dare say that at least 95 percent of all puts ever purchased “naked” have lost money for the trader.
Click here if you’d like to learn more about the Hidden Pivot Method, including how to identify and trade targets such as the ones used above, and to forecast trends with bold confidence.
The bad guys had gold on the run Sunday night, presumably bound for the 1672.30 downside target of the pattern shown. It would take nothing less than a pop to 1733.00 overnight or Monday to put bulls back on the offensive. The bearish target can be bottom-fished — preferably with camouflage, but if you want to take the easy (but somewhat riskier) path, because the pattern has such gnarly appeal, you can bid 1672.40 with a 0.50-point stop-loss. Nimble traders can also look for a turn at 1685.70, the midpoint support of the lesser pattern shown with purple ABC coordinates. Keep in mind that ‘camo’ shorts would be aligned with some even larger downtrends that point to either 1638.00 or 1633.10. _______ UPDATE (11:43 a.m. EST): Bottom-fishing at 1672.30 could have produced a small profit, but probably no worse than a scratch when the futures subsequently headed lower. There was a 12-minute bounce of $3.40 from 1672.60 at 8:42 a.m. (3-min); and a $3.80 bounce from 1672.00 that lasted just a few minutes. Since we were using an initial stop-loss of 50 cents, the bounce we’d anticipated need only have been $1.50 to give us a reason to take a partial profit on half the position.
I first touted Snipp Interactive back in January, when it was trading around 0.15. Although the stock subsequently fell to a dime, it has since rallied sharply, settling at 0.2562 yesterday. This is one of my favorite stocks, and I came away from a conference call with its CEO, Atul Sabharwal, eager to sing their praises. During that call, I hit Atul with my best idea, a sweepstakes-type promotion, but he was already three steps ahead of me, able to cite, for one, New York State’s rules and costs for exactly the type of marketing scheme I’d suggested.
Full disclosure: I hold 100,000 shares plus warrants to purchase another 50,000 shares. But I hope that won’t discourage you from performing your own due diligence, since you are likely to be as impressed as I was when you find out what the company has been up to. For me, at least, Snipp (OTC: SNIPF) perfectly satisfies Peter Lynch’s rule that investors favor companies whose strengths and methods they can understand. Snipp does interactive marketing that allows clients to track results in real time. The results have been sufficiently impressive that the company has been attracting blue chip clients with little difficulty. Read more about SNIPP by clicking here.
From a technical standpoint, although the stock’s chart history is thin, it’s possible to project a near-term rally target of 0.2730. A tenet of Hidden Pivot analysis is that an easy move through such targeted resistance implies there is unspent buying power percolating beneath the surface. This is not a “hot tip;” indeed, Snipp’s story does not lend itself to the kind of hubris that will result in a $10 billion IPO. But it is an aggressive and imaginative pioneer in a rapidly developing niche, and its CEO has the kind of imagination, intelligence and energy that inspires confidence.
Tesla’s strong rally has turned the Oct 3/Sep 5 calendar spread into a solid winner. The spread is currently trading on a bid/asked of 4.50/5.07. This means subscribers who bought the spread for as little as $1.00 last week could have quintupled their stake. The most paid for it would have been about 1.54. In any case, I’ll suggest offering half of the eight spreads to close today for 4.70. We’ll plan on rolling what’s left on Friday by covering (buying) back the September 5 300 calls we’re short and shorting the Sep 12 300 calls at the same time. ______ UPDATE (10:40 p.m. EDT): The stock’s push to an intraday high at 291.42 made the spread an easy sale for $5.00+, so I’ll consider the order filled. Now, roll the four spreads that remain into the October 3 /September 12 calendar as detailed above. _______ UPDATE (Sep 7, 10:31 p.m.): The midway price on the spread intraday was 2.30. Imputing the premium to the four October 3/September 12 calendar spreads we now hold would zero out the initial cost of 1.54 and add 0.76 to the real-time value of the spread. We’ll plan on rolling the spread again on Friday by selling the September 19/September 12 call spread (and thereby covering the short Sep 12 300s), but for now do nothing further. _______ UPDATE (Sep 15, 12:54 a.m.): I’ll use a 0.37 price, midway between the intraday high and low, as the spread price unless I hear from someone in the chat room who did better or worse. Imputing this new premium income to our Nov 22 / Sep 20 spread gives us a CREDIT cost basis of 1.13, for a guaranteed minimum profit on the position of $452. That would be in addition to whatever the Nov 22 calls fetch when we exit them.