MaysTrade

Welcome to the blogosphere, Billy! Check him out:



http://maystrade.blogspot.com/



During the trading day, Billy is usually over at Wallstreak or Dissect.org banking profits.

10/28 Day/swingtrades

What an incredible short squeeze. The markets gapped open higher, traded back down to close the gap and just took off in the final 2 hours. It incredible to compare yesterday's close to today's. I only managed to hop onto MS for $1.00 profit late in the day. I'll look for a retracement in the AM to initiate some long positions.

BTW, I was speaking to my boss today about her retirement portfolio which is in the shits. I know most of you readers are "traders" but just in case you have a nest egg somewhere that has taken a blow, now is NOT the time to diversify. This may just be a bear rally and we may even go back down(doubtful) tomorrow. However, with this volatility, I think you're better off taking your portfolio and stalking a stock or two that can get you 20-50% on a short-covering rally like today (i.e., CLF, X, CF, SSO). For instance, FNM picked up 16% today and was at $1.90 at the beginning of October. The government has already committed to supporting FNM/FRE so what is the downside. If my nest egg was down 50% , I'd have a higher chance of seeing FNM go to $1.20 to pick up the 50% than wait on a diversied portofolio that may never recover to its value 1 month ago. Anyways, this is NOT a recommendation...just a different perspective for the longer-term trader/investor. Now is not the time to be loyal to those schmucks that have been taking regular fees from your accounts with no consequences when they lose your money. It kills me to see my friends/co-workers entrust their retirement money to money managers that have no experience trading and have only ridden the coat-tails of the recent bull market.

Fear & Greed Trader

If you're having trouble daytrading this volatility, check out the human trading machine:



http://fearandgreedtrader.blogspot.com/



He's dialed-in, keeps it simple and banks six-figures on a daily basis!

10/27 Day/swingtrades

Looks like the rallies are still getting sold. I think we continue this way until the Fed announcement this week.

OIH - I picked up some Nov 40 Calls as it broke out of the triangle. I got stopped out @ 84.50 for 2.50 profit on calls. That would have been a great time to go short but I was too busy with a conference call.


POT - I went with Nov 30 Calls as it broke out of the base. The action was pretty weak as I got stopped out for $0.20 gain. Again, that would have been a perfect time to flip to the short side.

10/21 - 10/23 Day/swingtrades

I haven't traded much at all this week except for those energy swings on Monday and AAPL yesterday morning. Looking at those intraday charts the past couple days, I should have just called in sick for the week!

AAPL - I had time for one trade before heading out of the hotel yesterday morning. AAPL had a lot of selling pressure going into earnings on Tuesday. I just knew the afterhours gap could not hold in the AM as there would be too much profit-taking. Using the 1-min chart, I waited for AAPL to consolidate and cross below the moving averages. I shorted the stock for $2.80 profit.

OIH - After closing at the highs on Monday, the entire sector gapped lower on Tuesday AM. I sold @ 100.00 for $3.00 profit on the calls as OIH retraced most of the gap in the AM. There was another run-up late in the day but I was not around to get sucked in before the sell-off.

NOV - I should have taken profits on the run-up above $31 but eventually got stopped out for $0.30 loss on the sell-off.

BUCY - still holding the Nov 30 Calls.

10/20 Day/swingtrades

Energy/commodities were all the rage today. I jumped the gun in the AM and took $1.00 losses on ANR and APA. However, as the day progressed, I entered a few low-risk setups for swings.

OIH - I entered Oct 50 Calls as the volume started picking up midday.

NOV - "The Fly" has been all over this one the past few weeks so I kept it on the radar. I picked up shares as the premium on the calls were a bit too high.

BUCY - This didn't participate in today's movement but earnings are in a few days and I'm looking for a pre-earnings run-up along with any strength in the energy sector. I went with Nov 30 Calls since the stock is trading pretty far off from the daily moving averages and mid-30's is possible.

I'm out-of-town the rest of the week for work so trading/posting may be limited.

10/17 Day/swingtrades

Expiration day definitely lived up to its reputation today. There was a great opportunity to buy ATM/OTM calls at the open and then switch to puts mid-day as the market makers started squaring their positions and trying to "pin" stocks. I mainly stayed with GS and GOOG in the first half. OIH and basically all the energy/Ags were great options plays on the early morning dip as well. Too bad I didn't trade them.


GS - In addition to yesterday's Oct 100's, I picked up some 115's for only $1.00 as GS broke out of the 112 area. I sold the Oct 100's @ 118.00 for $9.00 profit and the Oct 115's for $2.50 profit as GS formed an intraday double-top @ 118.50.

GOOG - I picked up some Oct 380's around 376.00 for $2.80 as it broke out of the 370.00 narrow range. The premiums were still a bit high early in the day and GOOG had trouble breaking the 20-SMA on the daily at 385+(this level also coincided with the 20-SMA on the daily chart...see below) so I sold the calls @ $6.00 for $3.20 profit.

AAPL - What a loser stock today. I'm going to short this on the next leg down. I let my calls get stopped out at break-even in the morning.

Lastly, just to tie up some loose ends this month, I had a bunch of speculative positions expire on me. Each one was within my risk parameters except for OIH/UNG:

AIG (Oct 4 Calls) - I had locked in some profits and rolled the rest into Oct 4 Calls. The stock tanked along with the market after the rescue bill was signed. -$1.25 loss on Calls

C (Oct 25 Calls) - I had picked these up on the bullish looking daily chart. The Wells Fargo bid the following day derailed this trade. -$1.00 loss on Calls

FNM (Oct 2.5 Calls) - This trade also got derailed by the rescue bill sell-off. Loss - $0.25

OIH (Oct 165 Calls) - Damn, I forgot I even had these (Oct 165 Calls). I picked these up on a Monday or Friday just to see a gap open lower the next trading day. Obviously, they didn't recover. Loss - $3.90 on Calls

SMH (Oct 26 Calls) - Same thing here as for AIG/FNM. I had taken 1/2 off when it started fading. Loss - $0.65

UNG (Oct 33 Calls) - Apparently 33.00 wasn't the bottom. Loss - $3.40

10/16 Day/swingtrades

Today played out very similar to last Friday. Morning selloff followed by a retest of the lows and then a bounce into positive territory. Most of the stocks on my watchlist either tested last Friday's lows or retraced to the break-0ut level. I've been using SKF/SRS/SMN/EEV to gauge the market direction. All those stocks started topping out before breaking down, which coincided with the market rebound off the lows. The action today was very bullish as we carved out a higher low compared to last Friday. We may be putting in a temporary bottom which would be nice given the carnage the past few weeks. Don't get me wrong, I'm all for shorting/puts but at these levels, the odds are better for a bigger move to the upside. Let's hope for another 1000 point move tomorrow!

OIH - I don't use this set-up as often as I should but many times, stocks will tag the moving averages (usually 15 or 30-min charts) before continuing the prior day's trend. GS did the same on the 1st 30-min candle but I didn't take that trade. Instead, I faded OIH with Oct 105 Puts as it tagged the 20-SMA on the 15-min chart. I switched to the 5-min chart to manage the exit and was taken out at 87.00 for $4.50 profit...before OIH moved even lower.

MS - I took a $0.40 loss as I entered in no man's land @ $17.60 in the middle of the day with a stop @ 17.20. Looking back at the 5-min chart, I don't know why I even entered at that time and how I came up with that stop instead of $16.90 ($0.10 below the morning low)...basically overtrading.

GS - Picked up some Oct 100 Calls @ 108.30.

AAPL - Picked up some Oct 100 Calls @ 97.00.

BTW, my biggest regret of the day was GOOG. I pulled up the chart @ $315 and saw a potential double-bottom ($310). I then pulled up the options but all the premiums were ridiculous ahead of earnings. Looking back, I should have halved my position size and just bought the stock which would have been good for $30+ into the close. I wouldn't have held over earnings, though.

10/15 Day/swingtrades...none

Damn. I went into cash yesterday and had a lot of ammo to deploy when the market opened. Unfortunately, I was out of town on business and wasn't sure if the meeting schedule would allow me to manage any positions. I thought OIH was the best looking short (break below 98.00) in the AM but was headed out of the hotel when it started breaking down so decided against initiating any positions that may ruin my day. I'm happy I avoided the bloodbath but not happy about all the missed opportunities. I hope some of you were able to make some decent trades today. In contrast to Monday, ATM/OTM PUTS in energy/commodities would have paid out very nicely.

With 2 days before expiration, there should be lots of more opportunities to trade the volatility with exceptional risk/reward using ATM/OTM options. My plan for tomorow...if the markets gap up, I'll fade it to last Friday's lows. On a gap lower, I'll use the opening range high to pick up Calls and catch a move back to the moving averages. Scanning last Friday's charts will be helpful to prepare for tomorrow.

10/14 Day/swingtrades

Apparently, even the "professionals" are getting killed. Here's a link to the Journal article:

http://online.wsj.com/article/SB122394318763531045.html

"...Mr. Cohen, for instance, sold near half of his stock holdings last week, closing out the positions of roughly 50 managers who work for him because he felt they "weren't seeing the ball," says a person familiar with the situation. Mr. Cohen's decision was made at the end of September and comes from an attempt to stem this year's losses. He now plans to keep that money on the market sidelines for the rest of the year, though he is still trading a small portfolio, along with a few other managers. The managers whose portfolios were shut are feeding Mr. Cohen short-term trading ideas, the person says."

This morning's gap open was the perfect selling opportunity after the monster run-up yesterday. I was so busy closing out long positions in the first 30-40 minutes that I missed some opportunities to go short. I'm back to cash and will see how the market reacts to earnings.

GS - 2 weeks ago, I picked up a few Oct 130 Calls. I had assumed these would expire worthless. Instead, I used this morning's strength to close out the calls for only $0.50 (vs. 3.50 yesterday) loss.

MS - This was the biggest overnight winner for me due to my position size. I picked up $3.50 on the Oct 19 Calls. The Calls were only trading @ 1.15 when I bought them yesterday. The chart is very similar to that of UYG. For some reason, my charting software won't send me the chart for MS.

UYG - I closed this position at the open for $2.00 profit on the Oct 8 Calls.

AAPL - This was weak all day. I started this position with Oct 95 Calls on Friday when AAPL was back @ $95+ so I let it slip a couple dollars before finally exiting yesterday's Oct 110 Calls @ $112+ for $2.50 profit. I tried going short with Oct 110 Puts late in the day but got stopped out for $1.00 loss.

10/13 Day/swingtrades

I started this post yesterday:

Now that was a f'n rally!!! I wish I were posting some monster gains today but my excuse...insomnia. The winds were howling last night and I found myself looking at charts and reading news since 3:30AM PST. By the time the market opened, I was a zombie. I missed the first bounce off the moving averages but caught some of the late day craziness. BIDU and GOOG were definitely the options expiration trades of the day. Any ATM/OTM options in the morning would have paid off handsomely.

AAPL - I picked up about $8.00 on those Oct 95 calls purchase on Friday. I rolled the profits into Oct 110 Calls in case we get some weakness tomorrow.

UYG - Picked up Oct 8 Calls @ 10.02

MS - Picked up Oct 19 Calls @ 17.87

GS - This was the worse non-trade all day since I had it down on the gameplan. I was staring at this @ 100, 101, 102...it just never clicked to pick up the Oct 105 Calls which were trading $3+ at the time.

10/10 Day/swingtrades

I spent most of Friday morning torturing myself for selling all the OIH puts on Thursday. After trying to keep up with the wild market swings, I finally took some AAPL Oct 95 Calls home. We may get a gap open tomorrow morning as current futures suggest but I'm willing to miss out on the gap and enter on a pullback. If we finally get the rebound that everyone is expecting, I'll be looking to enter at-the-money options in UYG, AAPL, GS and OIH. I also like FNM/FRE shares. At $1, the long-term risk/reward looks good.

The fundamentals are still horrible so any bounce will be purely technical. Also, any bad news from MS or some of the dow components such as GM will send this market right back down. We're going to get earnings from a bunch of the banks (C, JPM, MER, WFC, ZION, etc) as well as GOOG so for the daytraders, the volatility will march on. Stay nimble and don't forget those stops/trailing stops!

10/9 Day/swingtrades

I didn't have time to post this draft on Thursday because I wanted to include the OIH chart...

So much for a "rip the face off the bear" rally. October is definitely living up to its reputation as crash month. We've now moved 2000 points lower on the Dow since the bill passed and 2400 since the original bill vote in which Pelosi ran her mouth off. Now, she wants to propose a $160 Billion stimulus package. Had she kept quiet, we may have had a chance to stem the fear in the capital markets and stop the trillions that have been wiped out. Obviously, there are other major problems at hand but a lot of it is psychology(fear) and I still believe we had a window of opportunity to prevent this meltdown during that first vote.

Anyways, it is obvious nobody wants to risk the little money they have left in the markets...unless you're a short-term trader. I was glad to see the short ban expire as the bid/ask spreads on puts finally closed up. Unfortunately, stocks I wanted to buy puts on (asset managers LM, BEN, BLK) have already made the move lower the past few days.

Today was take your pick to short day at 11AM. I went with OIH. I should have held through Friday but did pick up $4.00 on the Oct 130 Puts.


I found a narrow range on WFC and went long (this was before everything broke down) some shares @ 28.30 but was stopped out at break-even 30 minutes later. I'm not including the chart because there are too many trendlines/moving averages to see anything helpful.

10/8 Day/swingtrades

That was a true roller coaster ride. Maybe this is a contrarian indicator but I'm starting to think we may just head straight down without a rally. Everyone is looking for capitulation but the problem is that the hedge funds are facing massive redemptions and middle-America is moving their money out of the mutual funds and into cash. Aside from day/swingtraders, no one wants to dive back into the markets. The Fast Money guys are discussing a potential "rip the face off the shorts" rally. I say what shorts? We just dropped 1000+ points with a short-ban in place! Anyways, we'll see how this plays out tomorrow.

I made a few trades the past 2 days but net-net, I've been getting chopped up.

10/7 - GS, stopped out of Monday's remaining shares @ 117.50...$1.00 profit
10/7 - OIH 125 Calls, stopped out in AM for $1.00 loss
10/7 - Picked up UAUA 12.5 Puts and sold for $0.70 profit as it dipped to 5.00. Nice call last week on the airlines, Darwin!

10/8 - C, picked up $1.30 after it moved out of the base at $14.00 along with the rest of the market
10/8 - AAPL, picked up Oct 90 Calls as the market rallied and stopped out late in the day for $1.00 loss
10/8 - LDK, picked up shares @ 22.30 and stopped out @ 21.40.

BTW, want to make 60 points in one day? Follow this trade and then go get yourself a heart monitor with your profits:

Buy SKF puts this AM @ 150 and sell them @ 136. Then go long shares @ 136 and take it up to 150 again...then switch back to Puts and ride it down to 134. Lastly, go long @ 134 and sell @ 150 at the close.

10/6 Day/swingtrades

Wow, that was one nasty looking seesion! Thank goodness for the $700 Billion "Rescue" package that was approved too late. Trillions have been wiped out of the markets. And, how about that short-selling ban. With no shorts to cover, there is no one to cushion these sell-offs. Paulson/Bernanke are running out of ammo and have yet to address the "fear" in the markets. Everyone has seen the bazooka and they're not impressed. Time to unveil the f'n new and improved Death Star! I say coordinate a global interest rate cut and bypass the banks by lending directly to companies in need. IMO, those are the only 2 ideas floating around that have a chance to stabilize the world markets. At some point, housing needs to be addressed but there is still too much excess that needs to be worked off. Around my neighborhood, people still think they can command 2005 prices...fogettaboutit!


Sadly, I hope we don't see anymore of this...


http://news.yahoo.com/s/ap/20081007/ap_on_re_us/bodies_found

Today, I missed the early AM breakdown but caught a couple reversals.

GS - 115.00 has been good support since this is Warren Buffet's exercise price. I picked up some shares after the $115.00 retest @ 116.50. I sold 1/2 near the close @ 125.50 for $9.00 profit.

AAPL - I picked up some Oct 50 Calls as AAPL found support around 88.00. I had an open order to sell once it hit the opening range high so got out a bit too early. Picked up $4.00 on calls.

I also took home some OIH Oct 125 Calls and still holding positions in FNM, AIG and SMH.

10/3 Day/swingtrades

The markets sold off on the rescue bill approval as expected. Psychologically, the window of opportunity to stop the bleeding in the markets closed with Monday's votes. Time for Paulson/Bernanke to try something else.

GS - After the first leg down, I waited for some consolidation before entering an order for puts on a break-down below 135.50. GS setup again so I pyramid @ 133.50 and finally exited @ 129.50 for $5.00 profit on the puts.

SOV - I sold the remaining position at 6.00 as the market started rolling over. This started off as a low-risk daytrade @ 4.24 so I'm satisfied with catching the extra move.

AIG - I sold some more AIG 2.5 Calls and rolled the remaining position into Aug 4 Calls to manage the downside. In hindsight, I should have just stayed out after selling the Oct 2.5's. But, I've already locked in a decent profit and am trading with the "house's" money so can affort to let the profits run a little longer in case we get a snap-back rally.

10/2 Day/swingtrades

I think a lot of people complaining about Monday's bailout vote are regretting that they complained about it. The sheer wealth destruction this week is incredible. Middle America is going to go into psychological depression when they get the next IRA/401k statements. We may get a snapback rally if/when the government intervenes but over the long haul, our capital system is broken. Moms and Pops of America will think twice about redeploying their cash in the markets and/or discretionary spending which will lead to a long and drawn out recovery...if there is one. The "bailout"....fogettaboutit! I think it is getting priced in and over the past few days, people realize that it may fix the credit crisis but not the looming economic crisis so I want to fade any rally. Instead, we need a "surprise" event like a huge Fed rate cut, a gigantic stimulus check to ALL tax payers (yes, boohoo me but I got nothing from the gov this year) or Warren Buffet getting sworn into office!

Myself, I spent the day at the local ER. Instead of waiting for the Ags to break-down, I caught the falling knives of MOS and CF. I got stopped out for $2.00 loss on each. DITM Puts would have provided $6.00 in MOS and $10.00 in CF...serves me right for fighting the tape. I only bought a few hundred shares of each so maybe more like butter knives...but still got cut. It's crazy to see these stocks get obliterated. CF was trading at $125 on 9/22!

UNP - I thought this would break-down a little further so picked up some Oct 80 Puts but was stopped out an hour later for $0.50 loss.

SOV - I took a little more off the table @ 5.88 after it tagged 6.00 twice and couldn't break through.

10/1 Day/Swingtrades

Another chopfest...up, down, up, down. The financials held up pretty well and the late-day buying is becoming common...but will it last. Ags/energy took a hit and it worsened afterhours for Ags as MOS got clobbered. 2 months ago, BG reported great numbers but fell apart and I thought the markets had it wrong. Apparently, this global slowdown theme is really sinking its teeth in. It's hard to believe everything would fall apart so quickly but as we've seen with the Baltic Dry Index, the trend is still downward.

C - I picked up some Oct 25 Calls late in the day. Check out the daily close above the highs 4 months ago...impressive.

SOV - A partial re-gift today. After re-editting last night's post on the bull spread this morning, I pulled up the intraday chart and saw that SOV was finding support at the $4.00 area again. Yesterday's set-up was better with the strong market. Today, I had to wait for confirmation and didn't completely load up due to the market weakness. I picked up a few shares @ 4.24 and took partial profits @ 4.90. For the remainder, I sold the shares and established an equal position in the Oct 2.5 Calls to limit my risk in case the stock craters but still keep my upside open.

FNM - I added FNM Oct 2.5 Calls to the shares I picked up last week. FNM traded in a very narrow range today and could be coiling for a move higher pending rescue plan approval. Let's milk this trade, D!