NOK - Starting to turn - Following the pattern!

 NOK (Nokia) has been following a pretty steady pattern for the past few months of a big jump (around 4-5%) in one day and then a gradual sell off over the next few weeks. My last post was identifying the 5% gain that took place on no news and for seemingly no reason.

 

Today's move down nearly 2% on light volume is consistent with the pattern that we identified a few days ago. An interesting note is that in the past few days, even as the stock was going up in value the PUT was having slight increases! Meaning that even as the stock went up, sentiment (and investors money) was voting against the gains. 

 

As you can see in the chart the pattern is repeating for the 4th time. Keep your eye on it. This stock is in a fairly shallow trading range and things can change quickly when that happens. Fortunately we can all rest assured that if the stock moves anywhere it is not going to be on performance data. Instead expect it to move down ward gradually.

My Nokia position is a Jan 2014 PUT option with a $5 strike. Because this is a pretty shallow trade without a ton of price movement, I will likely keep this option waiting for a dip in the $4 range. I know a lot of people think that the new $50 Nokia Windows based phone is going to create a buzz. I don't see it happening. Until Nokia or Windows are able to show they have any competence in the smart phone market I will assume the numbers will come in below expectations. Just look at the financials. Not Pretty.

So stick around for a move down to $4 in the LONG run. short term I'm expecting a bottom around $4.90 to $4.95 or about $.40 below current trading. Options usually trade heavily on momentum, if I can get 3 or 4 days in a row of negative momentum I'm likely to make a 20-30% gain on the put option.

Thanks for reading!

Straight from the Chart

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform. 

NOK - Can someone please tell me why NOK had a 5% jump today?

I just don't understand the jump today.

From what I can tell this has short opportunity written all over it. First of all I am ALWAYS leery of big moves that appear to happen for no reason what-so-ever. And if someone can explain to me how NOKIA suddenly became an attractive investment I'd like to know.

On the chart side I see several things including a nice channel telling me that the downward trend has been in place for the past 3 months with several instances of high volume jumps that take place for little or no reason.

I'm considering a Jan 2014 PUT option with a $5 Strike. I see this as a short term play as I ride the sell off down to the $5 - $4.90 level and get out with a nice 10%-20% profit on the option. Depending on how it opens in the morning, I'll let you know if I pull the trigger.

Thanks for reading!

Straight from the Chart

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform. 

SPLS - Taking some off the top - 48% Gain in just a few weeks!

I have heard it said on TV a thousand times. "Bulls make money, Bears make money, and Pigs get slaughtered." The quote is in reference to taking profits when you have them, take a little bit off of your position as it makes money so that if it turns you have secured the gain. Well I am happy to report a pretty significant win today in my little $1000 experiment.


With another 2% gain today the SPLS Jan 2013 options with $15 Strike that I bought on the post Q4 earnings dip were up 55%. Though I still have a strong belief the stock will go higher, I thought it wise to heed the advice of the professionals. So I sold both of the Jan 2013 options with $15 Strike and after commission was left with a 48% gain! Not too shabby in my book.

More significantly however, is that this trade put me up 40% on the year! Two and a half months in to the year I have beat all averages by a long shot. Remember, options are risky, but they can pay handsomely when you play them right.

I am still holding on to my Jan 2013 option with $17.5 strike. Its had a nice run up but didn't run as well as the $15 strike that I picked up as a bargain after the sell off on Q4 earnings. I still think this stock will hit $19. So I'll keep holding this option for the time being. If there is another sell off I will definitely add to the position as I did last time. Its been a great run for SPLS. It'll keep going, this is a nice long term play.

Thanks for reading!


Straight from the Chart

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform. 

CSX - Good bounce this morning but keep your eye on it.

That is the screen shot from this morning on CSX. As I had hoped it has bounced off the support level with heavy volume and a big gain. Looks like we may have found the bottom for now.

I'm still keeping my eye on it though, CSX may just be benefiting from a up market this morning.

Thanks for reading!

Straight form the Chart

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform. 

CSX - Keep Your Eye on It!

 

So I've been losing my shirt on CSX. After a recent dip I thought the company was ready for a rally. Thus far I've been wrong. Thankfully my position is relatively small compared to my major holdings, SPLS in particular. BUT, today is an important day and this week is going to be a big one for the performance of CSX. I've ridden this one down to its support level right here at $20. 

 

With a double bottom forming here at $20 we are going to see some action off of this price. If it falls below there are no support levels forming for about another 10% below $20. I am still holding my breath for a bounce off of the support level which is why I haven't sold yet. But I will be watching it very closely for the next few days. A day or two below $20 and it will be time to cut and run as it may run all the way down. 

Important note about trading options. Notice that I am experiencing a 50% decline on a 10% decline on stock price. If you are going to be trading options you have to be able to take the swings and you must diversify. The only good news is that a week or two in the other direction and 10% can double the options price. For me and the $1000 I'm starting with the risk is worth while, and thus far it has been profitable.

Thanks for reading!

Straight form the Chart

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform. 

SPLS - Continues to Rally

 

So I started this experiment with only $1000 so my dollar numbers are small. Don't look at the dollar amount ($110  Profit) but instead look at the percentage. As of today I have a 41% gain in the SPLS Jan 2013 option with a $15 strike. This option got cut in half on the 10% decline in stock price when the Q4 results were announced creating a terrific buying opportunity. It has bounced right back to where it was before the dip. But don't go anywhere yet. There is more to come for SPLS.

Staples (SPLS) raised its quarterly dividend by 10%. In the land of performance signaling raising the dividend usually means that management is confident in continued growth. Ignoring the crazy sell off that we took advantage of the other day, this stock has been showing an upward trend and higher lows since October. This stock has a 52 week high around $21. I don't know about $21, but I am calling that the long term outlook is a $19 target price. With the recent sell off on huge volume, I think most of the profit taking is out of the stock, clearing the way for a continued rally.

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform. 

Great return on SPLS after yesterdays dip. Called that one!

So as I mentioned yesterday Staples Inc. - SPLS - took a huge dive yesterday after releasing Q4 results and hitting expectations. There was a lot of profit taking and even more over reaction to a company that hit analysts expectations, but didn't blow them away. So needless to say my Jan 2013 Call option with $17.50 strike price took a huge hit. I lost all of the 46% gains from the day before and about 15% more than that even! HUGE hit for a one day swing. #OptionsAreRisky

After the SPLS stock took a 9.5% dive yesterday afternoon I saw a bottom forming and jumped in after Jan 2013 Calls with $15.00 strike price took a greater than 50% dive along with it. I sold my stake in Ford (F) and took some profits out to be liquid enough to buy on this great opportunity with a stock that has tremendous upside potential.

Then today when the world settled down and people came to their senses, SPLS had a 5% jump in stock price. I knew that was going to happen after yesterdays ridiculous sell off.  My original option gained the 46% back that it lost but it is still down a few percent from where I purchased it originally. And the new options I picked up yesterday gained 34% in one day!! Not bad huh!?

SPLS has along term trade potential here that is going to make me a lot of money on this trade. Well, I guess not a lot. I only have $1000 to start with. But all things relative, this is going to be a big one. I'll check back in tomorrow and let you know any updates.

PEP in the mean time had a down day, nothing I'm very concerned about, that's a long term trade that will probably have to wait till quarterly results to see a jump. Sticking with it.

Thanks for reading!

Straight from the Chart

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform.  

SPLS - PEP - and a great example how risky options can be

So the bottom fell out of SPLS today. I was ecstatic for the 46% gain yesterday, well today was about 50% down on some huge selling off and profit taking. SPLS has been performing nicely for the last several months and some profit taking was expected. What was not expected was the massive sell off that happened after they released financials and hit analyst expectations. That's right, they hit expectations, not miss, but actually met analyst expectations. After the Office Depot numbers yesterday I guess meeting expectations wasn't good enough.

The stock was down 9.5% at one point today. When it started to bottom out I took the chance to pick up 2 SPLS options that had been cut in half by the sell off. I'm telling ya, this is a great company. Several fundamental analysts reiterated their buy recommendations today after the sell of. This stock still has $19.00 written all over it. Its a long term buy, don't expect that tomorrow but get in soon if you want to get a hold of these bargain prices.

PEP is still headed in the right direction. Just wanted to give my backing again to another great company that is trading at a discount right now for no good reasons.

Too tired to type right now, more tomorrow

Straight from the Chart

Disclaimer:
Just to be clear, nothing that I'm posting on this blog is in any way advice that should be followed by anyone else. All investment decisions should be made carefully by all individuals taking into account their own financial situation and appropriate levels of risk. Do not take anything I say for anything more than it is, opinion, speculation, and woefully undereducated guesses as to how I think a few stocks are going to perform.