dow crash

Stocks will continue to fall – PUTS – AAPL, RIMM, BIDU, GOOG, C, SHLD, RIG

The stock market had a small run this week, but not enough to make back the money I lost in my huge Nov 07 call positions. I tell you the most annoying thing that can happen to you is when your co-worker rubs your lost in your face. My reaction like any other trader is to want to beat his ass and prove him wrong, but I have to admit he’s totally right. I did lose some big bucks, I told him, and now he’s rubbing it in my face. I suppose I deserve it in a little way just to have this 3rd party in retrospect show me “you are trading crappy and until you prove me wrong I can joke and not believe you” and I probably shouldn’t of told him. Recently my co-worker has been trading real money. He has already told me he has lost -$3500 real money. Of course he is blaming the brokerage website, the stock (BIDU in this case), and everything else except his own trading actions. I think the only real bright future I have going for me is that I can handle the loss and can take responsibility for my own actions. I lost the money because I waited waited waited just to see it vanish when I could of took a big loss, but still had money left over. I also noticed he has been depositing more money into his account after he loses. This is another thing he doesn’t understand about me. I have not deposited money into my account. I use what I’ve got or else you lose more. His wife does not know about this, I’m sure. He is newly married and even though I shared options investing with him I’m not going to take the blame for any of his future dumb actions. He will not practice trade, he doesn’t read up about market history, and he doesn’t listen. He’s very scholarly, but as he will find out it’s not about being smart it’s about trading with as much information to make the probability in your favor to be right and not just trading off “feelings” or acting cocky.

Speaking of “feelings” I have to say I’ve been overwhelmed with them recently. It is almost as my dreams have be yanked away from me. Paying off that $35,000 note would of been huge for me not having that payment making owning that trailer park much easier. So bad decisions create dead dreams, not to say it won’t be a success, but it would have been a better success paying it off and not trading the markets as I did.

As for real estate I’m suppose to be selling my 2bed/1bath home in Hampton, VA for $105,000 down from $119,900 to an investor who says he will pay cash (equity). This will be good so I can finally close on my second mobile home park. Hopefully, God, yes that great universal truth will be at my side on my next deal. I will be putting around $40k down from my home sale.

Oh yes, the stock market. I bought AAPL DEC 125 PUTS @ $1.17 today. I only had less than $1200 left in my account so it cost me just under that for around 10 contracts or a $1000 trade. This is my last money. In Pring’s Technical Analysis for Charting book it shows 3 trends from the years 1987 to 1989. The charts currently for November 2007 match exactly with this historical charts. Even some of the same things were happening like inflation, slowing growth, and selling less and less (such as homes in our case/construction). If this proves correct we just started to fall from the second bearish top meaning it will fall much more. Then supposedly it will have a run Dec 07 into Jan 08. In jan 08′ it will start to fall through 09′ a fall much steeper and longer then what has currently been taking place. If charts stick then I will be watching for short Call plays and longer Put plays. This AAPL Put option should only last until mid-DEC 07′ if charts pull through with all the negative news. Apple is a great company, but many great companies fall with the markets. It is when everything settles the best companies have unimaginable runs such is what happened in 2003 on after the big fall of 01′.

well later -fn


AAPL OCT 170 CALLS sold out up +25%, GOOG earnings

Okay so to finish from a few days ago I bought AAPL calls going up and I was sold out the falling morning for $2.60 up 25%. I wanted to trade into GOOG earnings, but with a small amount so I only traded $1000. Again I was probably being too greedy. I could only buy 1 contract and I did at $10 for GOOG NOV 690 CALLS, but I should of put my GTC order at $11.50 or $12 at the most. Early morning trading the next day the option only went up to $12.60 so if I only put it up a dollar or more I would of been sold out with a 10% profit. I put my GTC order at $15 because I thought GOOG which his $658 would of rose $5 since I was closer to in the money, but I was wrong. I also slept it! I put my alarm for 3:30 AM to get up right when the market opened so I could sell out, but I slepted in an hour and that cost me $300. I sold out at $7 with a $300 loss. I’m actually happy I loss only $300 because if I would of stayed in I’d lost a bit more. This is what is confusing: I bought my option when GOOG was at $639, but my option fell $3 dollars even when in the next morning it was up $9. You’d think my option would of went up with the stock instead of fell. How is this possible? I figured it had to do something with expiration Friday for options. My call option fell $3 even thought GOOG’s stock went up and held at $9 so like $648. I don’t know why my option fell so much but it did. I think for now on I’m not going to buy calls near expiration Friday. They must adjust the price or something. Anyway GOOG earnings should help the stock rise. The Dow drop of -$366 pts is termporary and I definitely expect Monday or Tuesday next week to have a pop and push the market higher after this big pull back.

Stocks I’ve been keeping a close eye on are FXI, GOOG, AAPL, NUE, SHLD, RIG
FXI is due for a correction with the asian markets. Just recently it has fell 18 pts within a week. If it breaks its major trend I might buy a crap load of Puts on it. AAPL’s earnings are OCT 24th and I might play Puts on it because historically Apple during earnings falls every time.
With NUE steel is starting a strong uptrend helped by X. SHLD is just very volatile and I’m looking for entry points since it is going sideways now. Lastly RIG had a peg of .41 does anyone know this? This stock has continually gone up its trend and if does at $112 it will start bouncing back up again to a higher price.


Fridays always seem to be bearish. – Week summary

It seems to me Fridays are always bearish or at least a great percentage. Every call option I’ve ever bought seems to drop on Friday. I believe I was even hinted from my mentor that Fridays stocks seem to fall after a week of traded on weakness and tiredness in the market place. I expected the market to continue falling after a small rally buying session after Feb 27’s predicted sell off. Fed Bernanke keeps trying to make investors stay optimistic about the economy’s neutral position and still solid fundamentals, but investors seem pretty gloomy. I’m gloomy, but today reading some old materials on the stock market I realized something significant which is that we are in “warnings season” when profits are lowered and companies warn about lower earnings. So I should be embracing this not being gloomy. I’m trading the wrong positions currently and that is probably why my portfolio is taking a beating. I’ve been very bad is the past 15 days I planned to pay off my car I instead traded all my money again.
“All aboard I’m all in” – for some reason I think like this and its getting to risky for my financial goals and health status.

I just recently purchased my first customized 6’6″ Classic 1970’s Fish surfboard. I’m going to have an awesome graphics design on the board with ironically my golden stock rules I keep forgetting or ignorning on the front so they are looking right at me while waiting for waves, and on the back I’m going to have a rising sun picture (like Japan’s rising sun flag) with the artwork called “rising sun” which is a male with wings stretched out taking off for hope on top of the rising sun image. Next to the male (possibly with a cartoonish image of my face) will be a mean bull on the left and a scared bear on the right. Under the drawing it will say “bull vs bear”.
This will be my stock market surfboard to remind me everytime I go surfing that I need to follow these rules to control the bulls and bears to be a master of the market. This might sound kind of nerdy and not very surfing imagery like, but surfing is a great time for quietness and memorization. The more I read those rules sitting out in the ocean the more I should live by them. I will post a picture of my board when its done.

Right now the market is shakey. This big sell off should spark a upwards rally, but we could be in for an extended decline. I think Apple Inc. in May starting to sell iPhone units will be a big help in pushing tech stocks like Apple higher, including Sony’s PS3 being a hot product with blue ray, Research and Motion’s phones, and Nintendo’s Wii performing and selling so well.

Speaking of “blue ray” this is definitely something to lookout for. I’m going to start researching companying manufacturing it and selling it because it will be the new HD picture formating tool of the future. Instead of DVD players you’ll start seeing Blue Ray players to show true HD picture which is now needed if you want to watch true HD movies/shows.


DJIA down -546 pts at low! All I can say is “wow” and “shit!”

Yesterday, as you should be already so aware of, the China markets had a big correction which basically followed around the world. One of the main causes of the China correction was because asians were buying up stock like no tomorrow. Investing has become huge since the government is helping capitalism and turning asia into a major world power. Now, because of all this buying with no major pullbacks the stock market just went straight up and finally it threw up and just passed out. You should expect upcomming pullbacks. Yesterdays small crash was just the first to more to come including our own market. Analyst keep saying that 2007 will be a very volatile year. Fed Chairman Greenspan and Bernanke say the same too. I think if the banking system can fix fiscal policy then this volatile will be to the upside. The Dow’s low of -546 points yesterday was wowing. I expected buyers to buy up today and make a profit, but I expect by tomorrow even or the end of the week for the market to go further down.

You probably also should notice we are in warnings season when most companies warn for lower profits. With the major drop now in the Dow we are probably going to see stocks drop lower. If you were in any Call options you probably shitted yourself in the pants when China dropped following our market and Europe. I maybe didn’t shit my pants, but the reality check in my stock brokerage account sure did make me think I was about to have a panic attack. Yes, I did see it coming and everyone talks about how Asia was going to crash soon before going back up again, but I don’t think anyone can predict exactly when it will happen. When stocks are going up you don’t buy Puts. I suppose this is just something pricey I’m learning as a student of the market.

I’m going to read one of my commenters books who recommended Gamblers Ruin. It’s on one of my posts that I made a decent profit on. Many people that do not invest saying using the stock market to make money is gambling. I do not like questioning myself, but sometimes I think they are right when I definitely know I gambled a trade. I do not gamble in casinos. I think they are boring. I like playing poker, but I never play for money. I can not spend more then $50 in a casinos on games, although when I trade stocks sometimes I just get into this zone and I don’t even think about the stocks I’m trading, why I’m trading them, and if I should be trading. When this happens I make the worst decisions, trade too much or ALL of my money, and basically trade losing positions. It’s depressing. It’s hopeless. It’s being a totally moron of a gambler.

I really don’t know if its a dependent thing because when I trade I really wish I had someone like myself to over look me or just tell me I’m crazy. Sometimes the finance ninja gets caught in too much action. I’d say the ninja needs to just goto the bar, get a drink, and stay away from his stock trading laptop. My mentor even told me to not trade if you didn’t know where the market was going or if its just too hard to trade. Yes, trading on an easier trend would be more profitable and easy. I guess I just want to so badly get good at this and reach my ultimate goals that principles of consistent tradings get knocked out of my mind somehow.

To any traders out there like me I wish us both the best…to getting some type of help. =D