NOK - Got to $4 faster than I thought! - Might be time to take profits

NOK - was floating around the $5 mark when the hype started building around the new Nokia Windows based smart phone that was going into Wal-Mart at the $50 price point. This was being billed as the smart phone for the masses and the revival of Nokia and Windows mobile platforms. I didn't buy it.

 

Much faster than I expected the bottom fell out once the hype died down and people realized that Nokia can't play in the American market and that Windows just can't get any traction in the mobile space. Windows does not have the developer base to build a mobile platform! In my last post NOK was at $5.33 and I predicted a long run trend down to $4. Only a few weeks later its already there. Might be a time to take some profits and run!

 

I've had a few other trades go against me (XRX) but NOK is looking at a hefty gain with close to 40% gain in just a month since my entry point with a $5 PUT option on 3/16/12. I still have faith in XRX so I might be closing out my NOK position today and doubling down on XRX hoping for a earnings beat on 4/23/12

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 - 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.