Lessons

1. If VIX is under 26, buy the dip. If VIX is over 26, sell the rip.

2. Always trade in the direction of the larger trend. Find the strongest trend in your time period.

3. Nothing as bearish as a failed breakout. Nothing as bullish as a failed break down.

4. Don't worry about the last dollar. Take your money and go to the beach!

5. No more than four positions at a time. Preferably 2-4. Scope out others. Pick the strongest.

6. Buy the strongest; sell (short) the weakest.

7. Nothing is guaranteed. Nothing.

Monday, June 30, 2008

Oil - Rocket Rise this Week?

if Oil is headed to 160, can the market rise? Can we even get a real short-term rally? If Oil keeps rising this week to meet MS target of $150 by July 4, how can we get the ST SP rally to 1305?

One possibility I see is for a rocket rise to $150-160; the last pop of the bubble, accompanied by new lows in the indexes. Then we can go up.

Sunday, June 29, 2008

Zach Bass's plan

This is from Zach Bass' latest article:

"So, what’s the outlook for investors. Well, next week, as I suggested, there will likely be a bounce from oversold conditions in the markets. If the bounce is weak, it will present a good opportunity to take short positions. If it is strong, then we’ll need to wait and see, as a retraction may not be immediate. Soon after the market has retracted from the bounce, I would expect the VIX to breakout, and the Put-Call ratio to spike. As the VIX crosses 30 and nears past highs, and the Put-Call ratio clears 1.50, cover those shorts and go long. At that point we should be near a bottom. Then ride this puppy into Labor Day, and at that time, Apple can take the winners podium and collect its gold!"

www.zacharybass.com

Saturday, June 28, 2008

Strengths and Weaknesses

Strengths

1. Predicting stock movement - thinking through everything.
2. Fundamental analysis and long-term trend analysis.

Weaknesses

1. I can't use stops for Swing trades. So I should only VERY RARELY swing trade.

So far, I've been successful mostly at intermediate-term call options (3-5 months out), and with long-term predictions. Swing trading, because of the Stop requirements, doesn't work for me. I don't like to follow stocks every day and cut losses as they go down. Not my style. I am good or can be good at analyzing sentiment, fundamentals and technicals carefully, deciding what will happen, and going long or short for a while.

2. Emotional attachment to AAPL.

Great company, but sometimes a bad stock - like any other. Don't let it become more than 30% of your holdings. Recognize your weakness.

June 30 - July 4 plan - Prelim

Preliminary thoughts -

1. Tech seems like it may be trending down for the next week or so; sell some Qs on the Monday rally and buy commodities. Oil crossing 140 means it is going to at least 150 or perhaps even 160.

2. Apple may rise to $175 - 180 on Monday or Tuesday on China news or an upgrade. If so, sell 2 calls on Monday highs and 4-6 more on Tuesday.

3. Sell BIDU on Tuesday.

4. On Tuesday or Wednesday go short Tech for a swing trade/hedge. (Use QIDs).

5. I Phone 3 G released July 11. Friday is July 4. I expect Tech to bottom again that Friday. Buy back then.

Wednesday, June 11, 2008

Oil is going to 115.

1. Change of mind. Oil is going down. Buy SU Puts.

2. Apple is going to $200+ soon. Buy July calls. Sell most of the Junes by Friday.

3. We're going up into Options.

4. Buy Google; Buy GS.

5. Buy SPWR December calls when it's around $65-70.

Monday, June 9, 2008

Tracking Apple

1. The intra-day Apple plan is to buy the dips ahead of the conference and to sell all at 12:30-12:45. Risky plan.

2. That Barron's rumor is funny. If it had come from anyone else, I wouldn't have known what to believe. But Barron's is Barron's.

2 b. Eric Savitz excellent post just negated the rumor. Change plans - I want to keep a little Apple and buy the dips during the developer conference.

New Target for June 180s. Half out at $9.5. (Purchase price.)

3. LT I want to start buying October 190s at or around $180.


4. But mostly I want to stay in cash. Let's look at some others as we set sell targets on Apple calls. I want to be all out or mostly out of Apple before the Key note.

Sunday, June 8, 2008

Oil's Wowie!

Well, that was a nice U-turn. About the only silver lining, from my selfish perspective, of the $10 jump in oil yesterday, is that there are others like me who were similarly fooled. Also, that I took some profits earlier.

BIG LESSON:
FILTER OUT THE NOISE. My initial target for WTIC was $122. I was going to sell my Puts until I read a transcript of some Money show on CNBC. All the pundits were sure Oil was going to keep falling. Yeah right.

I need to keep doing what I did this weekend. Read the best - the ones on my blog and perhaps the WSJ, and think uninterruptedly.

NOW:

1. Oil will go to $148.

2. Sell SU Puts on Monday and Tuesday. Buy SU Calls.

3. Buy DIA Puts - in stages.

4. Sell AAPL early Monday. Sit on cash. Wait and see.

5. Tech will lift us out of the funk.

6. Watch the IWM.

Wednesday, June 4, 2008

Oil shorts; DIA puts; etc.

Oil - Wondering if I should cash out a few of the SU Puts today. Oil seems headed to $112, but wondering if it's time for a short-term ... No. Buy more. We're just getting started.

1. Buy SU July 65s at $3.2 or better.

Apple will rise until next Monday or so.

2. Sell one Apple $180 at $12.7.
Buy one Apple $180 at $10.6 or better.

I think we'll get a rally today. Maybe I'll get rid of a few of my DIA puts early and reload later.

3. DIA Puts - sell early; buy later