Hype pushes Best Buy 13% - Put options to ride the wave back down.

Did you hear the news today about Best Buy CEO saying he will maybe make an offer someday that he thinks might come in around $26 a share if he can raise the money from a bunch of people that haven't yet committed a penny to the cause. And then did you see the stock jump 25% on the hype!

BBY closed up 13% as investors started coming to their senses and taking the gains on the beaten and bruised stock. There have been a few of these spikes for BBY over the past few months but none have shown any legs what-so-ever. Expecting this one to be exactly the same.

Placing a conditional order based on the sale of my Jan 2014 $1 Sprint call option. If that one clears for the price I'm expecting an order will hit for a $20 March 2013 put option for BBY. This option lost 30% of its value today on the ridiculous hype. I'll get that back in a couple of weeks.

I'll let you know how it turns out!
 

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.

 

Taking Profits in Sprint (S) 104% gain on this trade!!

104% up on Sprint in the past 8 months! Not a bad trade. Got in on this around December when Sprint added the iPhone. It has been nothing but up from there. After beating on earnings a few days ago Sprint has formed a good exit point on this trade.

It is a good point to bring up that I think Sprint (S) is a great stock poised for long term investment growth over the next several years. The combination of huge subscriber growth on lower than average prices and unlimited data plans will lead to revenue gains in many quarters to come. But my strategy is not about the long term investments. I'm in the trading game and I think I may have found some other opportunities that present a bigger quick win opportunity.

The chart told a good story back in December as a solid support level was established near historical lows for the stock. The stock rode that support level for several months before subscriber numbers began to forecast huge growth. Sure enough, with a huge beat a few days ago the stock gapped again forming the solid exit we have today.

I am selling my Jan 2014 $1 Call to free up some cash for a new opportunity that has presented a quick win opportunity.

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.

What a Croc! CROX is looking up.

With my summer internship coming to a close in the next few days I am able to turn some attention back to the markets. Oh how I have missed them. Unfortunately I have also committed one of the cardinal sins of investing in the process. I ignored several of my holdings during my very busy and very important summer. A few of them turned and I have given back some gains. But no use crying over spilled milk. Time to earn it back!

CROX - Yep Crocs. Who woulda thought this company would be making a strong push. 

Crocs is the maker of foam rubber shoes. It peaked about 6 years ago and has been falling off in the US ever since. So why on earth would I be thinking this stock is ready for a move upward? This is purely an international play. Crocs makes inexpensive shoes that are becoming more and more popular in several of the warmer climates in the world. Fortunately their shoes are also durable, and inexpensive. With the expansion of the Crocs line into several fashionable styles there prospects are looking quite good.

The chart also paints a very good long term picture. After falling from a high $20s price point last October the stock has found a strong support level while at the same time breaking out of a recent channel creating upward momentum on the chart. This coupled with CROX raising its guidance for next quarter paints a picture of a stock headed in the right direction. I'm calling this one back to $20 in the next several months. 

I have put in an order for a Jan 2014 $20 Call option. We will keep an eye on it and see what happens!

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 - 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.