Morning Update: February 10, 2014

admin@RandomWalkTrading.com

1–(855)–RWT-0008

Monday February 10, 2014

POT PEOPLE

Expect to see nothing but TOS and OptionsAnalysis in the sessions starting this week.

This is going to be a HUGE edge and benefit to POT people as I will not be making nearly the same amount of clerical mistakes. In addition you will be given access to our account where you can go look at the current positions at anytime to verify what is in there. 

The Dow closed up 165.55 points at 15,794.08.

The market is in a precarious place here. We are now 205.92 points away from 16,000.

One has to be confused here. I know that those I respect (Art Cashain, Rick Santelli, etc.) are confused as well. But the weekend gave me perspective. The things rocking the markets now are mostly overseas issues, which I have NEVER taken much concern with. Every country with problems is only a very temporary setback in our markets. Greece, Cyprus, Ireland, etc., only sent our markets skidding for a week or two until we realized “What harm can a country with a GDP smaller than AAPL do to us?”

I am standing by my prediction of NEW HIGHS before the “Big One” hits the US. I know that for the last two weeks I was very concerned about the market breaking down. I admit it. I was under the impression I was wrong in my medium term assessment of the markets with the continuous and increasing declines. Once we broke through support in the channel I was forced to say “I might be wrong”.

But now I am going back to what I was saying previously for a year. This market only cares about interest rates. The first sign that rates are changing will; spook the markets – it always has. But then things change after people calm down and realize that even with rates 75 basis points higher than previously, they are still dirt cheap. No one wants to be in bonds right now – they are just a temporary flight to safety vehicle.

So we will continue to climb as there is no where else to put money. Then one day in the next few months the bonds will fall far enough for all the asset allocation geniuses to start finding bonds attractive once again, and they will start moving in a herd (out of stocks and into bonds).

And that, my friend, has been how markets have historically come to a close when the Fed pulls out and doesn’t leave its phone number on the night stand. 

AAPL closed up 7.17 at $519.68

AAPL admitted/announced to buying back $14 billion (of promised $60bln) in shares. Also keep an eye on AVGO. Avago Tech is seeing some strange activity with 5,000 April ATM calls being purchased last week. They are an AAPL chip supplier, and it appears that someone knows something about a product coming out and AVGO being the beneficiary of it. Wearable device?

The stock (AVGO) was us 2.48 percent on Friday and the same on Thursday. 

Above is a 5-day chart in the stock (AVGO). 

Kaboom Again!

The VIX got smoked once again, this time knocked down to 15.29 (down 1.94). Amazing move this product is having. 

The TLT was down 0.52 at 102.77 despite the Fed stating that they want to keep rates low longer than previously anticipated. 

GLD = up 0.93 at 122.17

SLV = up .10 at 19.27

TSLA closed up 8.15 at 186.53.

POT people saw me stink this up. I had on a long position kicking in at the 187.50 strike, but it expired on Friday. Had I been out one week longer there would have been enough time value to kick the trade into gear.

NO NUMBERS TODAY

Actually no REAL numbers until the 12^th. 

Yesterday

An up day caught everyone bearish by surprise – even me.

A $60.11 range in the SPX cash last week, which equates to about a 3.5% range in the underling.

Today

No economic numbers are out today, and none are expected out (with any real power to move the market) until Wednesday. This will have everyone licking their wounds and realizing they panicked too early. This will go a long way to the next drop where people will be lulled into a false sense that “it always bounces, so don’t sell”, which will only make the real selling worse (when it comes).

PLEA

Please tell someone you know that they do not have to be a victim in the government created stock market bubble. I don’t care where they learn to hedge from. Send them somewhere else if you like. Buy them our BASICS book for Christmas. Buy them someone else book But help a friend out. 

Remember that next week 20^th and 21^st will be the POT session during trading hours. From Noon to 1:30 Eastern POT will be held instead of the 19^th to watch real-time scalping and legging into synthetic call and put positions. 

Too True To Be Funny

(Never a joke, but always funny)

People will buy anything. 

Attorney Stuff

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