Although Rick's Picks is designed to look like a horse player's tout sheet, subscribers will know that I don't often feature hot tips. I made an exception for Phil Calderone's hot tip on Kodak because Phil has produced some timely winners in the past, and because the stock had been working on a bullish flag for a month. This tip will have paid off well for anyone who took it to heart. Pivoteers may have noticed that the stock's impressive leap yesterday stalled precisely at a 'D' target (shown). EK looks to be consolidating, and so I will pass on to you Phil's latest update -- and caveat emptor. He sees the stock as having entered the second of three stages that will take it to around $8 sometime in the first quarter of 2011. More immediately, and from a Hidden Pivot perspective, EK looked especially impressive yesterday because the thrust breached two "external" peaks on the weekly chart. That doesn't necessarily mean it's going to the moon, but it does strongly imply that any weakness in the offing should be viewed as corrective.
Financial Bear 3X Shares
FAZ – Financial Bear 3X Shares (Last:5.42)
– Posted in: Current Touts Free Rick's PicksWe could stretch for extra bases, since FAZ looks eager to probe a gap above yesterday's high, but instead let's play it conservatively, offering four June 10 calls short for 0.35 against the four October 10 calls we already hold for ____
FAZ – Financial Bear 3X Shares (Last:4.81)
– Posted in: Current Touts Free Rick's PicksOkay, let's see FAZ try to hurt us, now that we've acquired four October 10 calls (FAYJB) for 1.20. These pups will require little tending in the weeks ahead, but I may call on you at some point to acquire some call options in another vehicle, the better to effect a strangle-type hedge. Thereafter, with a few bucks down on the pass line, we'll be better able to summon the proper enthusiasm when rallies happen, as they always will. This was a strategy I employed on the options floor in the late 1980s, when I was absolutely certain the bank stocks were about to collapse. They didn't -- far from it, actually -- and I lost a small fortune on the thousands of put options I held. But I made it all back and much more by being very long drug stocks, including Schering Plough in its heyday. Remember: We want to come out ahead no matter what happens, and we want to have fun while we're doing it.
