On April 24th: “UPS: Sell Here, $74 Is A Short”
May 10, 2008 10:08 AM
We posted on April 24th to sell UPS and if it went to $74 it would be a short. On May 2nd, it went to a high of $74.14. Currently, it is $70.29 and likely headed lower.
(Update: We also posted to cover that short at about $70.00 on 05/12, but I still believe lower is likely once $69.60 clears. $68.36 is must hold)
CHK: Buy Further Weakness
April 24, 2008 10:46 PM
If Chesapeake Energy (CHK) trades much lower, weakness should be bought, IMO. $48.60 should try and hold here. if we clear $48.60, it could spike lower. I do not think that would be a reason to panic as $48.60 is not a “must hold”. If we have seen the highs in CHK, and I do not think we have here….they should be at least retested.
04/25 Update: CHK soared Friday…up 5.6% while the SP was up a meager .65%.
Today’s Call: Long The Market, Long Financials, Long XLF, Unlike Yesterday….Long If Gap “Fades”
April 16, 2008 8:59 AM
The market is likely to be bought today. It appears that any and all checkdowns, especiallyy early should be bought. Pick your favorite stock and be long if market checks down early today. Mid 1330’s should be bought on checkdowns on the futures here, but i don’t think we are going that low. I am long pre-open at 1345.50. I would rather be long lower here….but have to take what I see. Housing data was brutal again, but people are ignoring it. They think it’s a bottoming “process” in housing. There are 100% completely wrong…but who cares…for today.
The only way caution would be in order here today is if we had a late counter trend trade and threatened to close below the open….that would spell possible trouble for tomorrow…but I see nothing up top here to stop any rally… There could be an issue near 1352 from the previous gap down….and that is a reversal point…very careful there on the futures unless that clears late…I would rather not chase…. If the gap “FADES” today, the fill should be bought….IMO
Caution on Financials in this area
April 2, 2008 11:10 AM
There are a number of reversal points on many financials not far above. The March 24th high on XLF was $27.37. While that is technically not an SB number short, there are stocks within that sector that do have numbers in that area. Keep in mind, ETF’s are approximations of indexes (in most cases) and it is possible that the index and the ETF are slightly different. Basically, the ETF number could be slightly exceeded, but not the index or the underlying securities. But if the SB number is exceeded on an ETF, it should at the very least get your attention.
The prudent play here is to probably take a little money off on financials, like 50%, and see if the reversal points clear as the risk reward seems marginal at best. $27.10 on XLF thus far…. I would consider taking half off right here if long yesterday…and wait and see where we are…(Trader’s should exit the long right here at $27.10, IMO)
Another Winning Call - Long CHK Today
March 24, 2008 9:36 PM
I mentioned last night to look to be long CHK today. Was an easy $1.00. Be far more careful tomorrow…..a checkdown is possible depending on where it opens…AND I do not like it up near $48… I also mentioned AGAIN pre-open the trade was long today…. I personally would have exited near $45.50 today as it was having an issue with an SMA that I watch on some stocks….and it couldn’t clear it all day…
If it clears todays high tomorrow….and even sniffs the opening price later in the day….EXIT if you happen to be long the stock…IMO. If it doesn’t close below the open, then the trade is still long….but be VERY careful up near $48….IMO.
CHK: The Call Was to Cover 50% of the Short…
March 21, 2008 3:25 PM
I mentioned to cover 50% (or all if you wanted) of our call to short CHK if it spiked down on Thursday and then appeared like it was going to close above the open. I would have been out of the trade totally later in the day once it became clear it was going to close above the open. The profit on this trade was $47.50 - $43.30, a whopping $4.20, 8.8% in 2 days…
A little more caution could be in order if it runs near the highs again. But the trade is to once again short near the high. I have called that trade twice already. I am not a fan of making a trade the third time it visits an area…i will updtate what I see if it gets there.
If you want to be long this stock, the trade is long with a hard stop below $42.15. I would like to be a buyer here near $43, if possible
CHK - Still no sign of a low reversal…
March 19, 2008 4:21 PM
$46.03 thus far….no reversal that I see… This appears to be more of a timing issue…If we can stay in this range all day then the heat likely will pick up later or tomorrow…
If we stay here or lower, it may spike lower tomorrow. If it spikes down tomorrow and then proceeds above the open, the safe play is to cover all or 50% of the short right then at the opening price…. I still smell lower on this stock longer term however…
CHK: Short Here at $47.50
March 19, 2008 2:08 PM
It appears that $48 area should be a lid on CHK today. If it gets much above that I would need to look at see what’s going on. The hard stop is above $49.87 as I said……$47.50 is short right here…IMO. I would rather short higher…but it may not get there…
CHK - Still an Avoid and/or Short
March 18, 2008 8:17 PM
I am still very negative on Chesapeake Energy here. It also looks like some commodities are rolling over certainly nat gas.
I said last night that I expected traders to short natural gas around $10 today. The high today was $10.085 and it closed at $9.10. Obviously it got crushed. I am not a “professional” trader, and have never traded commodities….but it seemed reasonably obvious what was likely to happen to nat gas today.
Nothing has changed on CHK. It is a short under $49.87 with a hard stop above that, IMO.
I still believe, obviously, that Cramers roaring bull call on CHK is going to be grilled to at least medium well…
The only way this thing is going higher here is if a massive continued rally lifts this sinking ship…which is always possible.
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