April 2009

Okay. Everyone seems to have picked up on the easy-as-pie Microsoft trade, buying October 13 puts as recommended.  This gambit has the potential to pay for your subscription, and that's why I offered it. But might I also suggest that you take an interest in Goldman Sachs?  The stock has been yielding up trades that have not only been highly profitable, but very nearly riskless.  The little s.o.b. has started to grow on me, really, and as long as it continues to be, well, fun, and as long as we've got the stock nailed, why not come along for the ride?

Anyone who wants to know what's on the stock market's evil little mind need only monitor the behavior of one stock: Goldman Sachs [NYSE Symbol: GS].  These days, Goldman is the high-beta vessel of whatever madness appears to rule at a given moment. As such, it's often possible to predict the stock market's histrionics based on Goldman's crazed leadership. Yesterday morning, for instance, we were expecting the stock to shoot up to 131.80  - about $8 above last week's settlement  price - and to drag the stock market along with it. In a trading tout disseminated to subscribers late Sunday night, here's what we foresaw:  "[Last week's $10 finishing stroke] was a short-squeeze truly worthy of the name, since it came on news that Goldman Sachs plans to float a zillion new shares while the gettin's good. We hesitate to predict how high the squeeze will go, especially with index futures evidently under pressure Sunday night.  But our hunch is that stocks will get dragged higher by Goldman rather than the other way around.  If so, look for the rally to continue to at least 131.80, a good place to try shorting on your terms with a tight stop-loss."  New Rally Targets We didn't get the short off because GS peaked yesterday at 131.27, a tad below our target. However, earlier in the session, when Goldman pulled back a bit, we put out a bulletin recommending that subscribers add some bullish call spreads to an existing option position. Specifically, we advised buying the April 130-135 vertical spread for 1.60. (We already owned the spread a few times for an average 0.36.)  We have been expanding our option position for the last few weeks, trying to build a profitable edge across a wide price range. As of yesterday, with a position that

No surprises so far this morning, since the "Goldman indicator" seems to be working just fine:  stocks opened down -- a Monday morning shakeout maneuvered by buyers -- but a recalcitrant Goldman is now pulling the entire market back up to "unchanged."  It hasn't hurt that another invincible stock, Apple, is bucking the engineered selloff.  Keep that 871.25 E-Mini S&P target in mind, since it is all but guaranteed to be reached by tomorrow or Wednesday.

DXY could create a potent bullish impulse leg with a relatively short thrust to _____, although there was no technical evidence Sunday night that such a move was imminent. The key to the short-term chart lies in a look-to-the-left peak at

A rally target at exactly _____ is equivalent to the one we've been using for the E-Mini S&P. Leveraging the upside will be catch-as-catch-can for night owls, but officially I'll recommend shorting _____ via an_____ offer, stop _____

The _____ rally target broached here last week looks as compelling as ever, and any minor patterns that turn up on the lesser charts should therefore be used aggressively to leverage what's left of the move. (And so should a pullback to ______, since that is the Hidden Pivot midpoint -- now support -- associated with the target

Gold is wafting ever-so-gently higher Sunday night, but it will still need to push above the modest threshold at _____ flagged here last week in order to cause shorts discomfort

A Wall Street Journal story out over the weekend told how Steve Jobs has continued to run the show while on medical leave. He's due back in late June, but in the meantime we should expect Apple shares to move relentlessly higher -- most immediately to the

Friday's $10 thrust was a short-squeeze truly worthy of the name, since it came on news that the company plans to float a zillion new shares while the gettin's good. We hesitate to predict how high the squeeze will go, especially with index futures evidently under pressure Sunday night. But our hunch is that stocks will get dragged higher by Goldman rather than the other way around. If so, look for the rally to continue to at least