Technical Difficulties

My recording software is getting a soft re-boot. Yep, somebody tampered with my recording studio. Don't worry, I have asked my secret agents to check the surveillance tapes last night to see who did it. There will be hell to pay.

Until I find a solution, it is with deepest regret that I put today's video on back order. I can't imagine that it will take too long, but I wanted to give everyone a heads up.

In the meantime, AAPL has lifted the market just as I suspected. There is a monster bid for technology stocks, and we are getting some great moves from the supporting casts such as small cap, financials, etc. You have to buy into this dip. If you are nervous, nibble into it.

Lastly, if you tried to participate in last nights event, I apologize for the lack of technical support, audio stream, and everything else that went wrong. The event was way overbooked (2,700 people) and Webex apparently can't handle that type of volume. The fact that the technology around here makes me look bad is really starting to get under my skin. Anyway, the presentation was recorded, and will be posted on the Investools site later today. Again, my apologies.

Watchlist developing...

Bringing this forward from the last thread...

Chris, you big, fat Meanie... how long are you going to torment me? So I use SO WHAT?!?! This is cruel and unusual punishment, and I won't have it anymore!

Okay, now on to trades. I got emotional and exited XOM with a small loss. Today, they're up some. Are you still in it?

I thought I had this emotion thing down, I really did. But yesterday I just kept thinking about the pain and agony of losing all those unrealized gains on Friday, and I (dare I say it?) panicked. Oh, the shame! I mean, what was I so scared of? I was properly position sized with 4 small contracts, and I hadn't even hit my exit yet. I just flat out panicked. UGH! And when that happens, it's not just the loss of money, you know. I mean, that's bad enough, but it's the disappointment that I feel about myself that really brings me down.

I plan on doing something very painful this week: printing out the chart all of my trades from the last 60 days and analyzing them, from entry point to exit. With my track record, that's going to hurt, but it's what I need...

Wow, most of what I wanted into today has gapped too far for me BEE (ok that just sounds funny REE is better)

Still looking though.

Wait til you see my list this week, Bob. It might be the best ever. Plenty of BEE's for you to play with.

Clearly... when you say "I thought I had this emotion thing down"... you are not correct. If in doubt, just re-read your second and third sentences above. Time for the breathing exercises.

Unfortunately I must join you in the "Dungeon of Shame." I also exited XOM, NOV, and several others in a Chicken Little move.

I am now at a crossroads with my WNR. It seems to be bouncing and I'm not sure if I should take profits and run, or sit out the bounce and ride the next leg down. This is where I suck. Indecision is my middle name.

I don't even know if jeff has this on his watchlist, but you won't find a better risk/reward trade than:


Know about it. See the flag break? That's a huge flagpole. See old resistance as new support JUST tested yesterday?

You're so lovely. Give yourselves a hand.

Okay guys, I have a question. There seems to be a fine line between "buying the dip" and "catching a falling knife," as Jeff would say. My questions is How do you tell the difference?

On the watchlist last week, Jeff said buy the dip on CMG. On the Marketcast when some poor chap said he'd bought the dip in Hansen, Jeff rang the buzzer. How do you know the difference between buying a dip and catching a falling knife?...

I was thinking of investing some of my cash this morning but I think I will await the Master's list. I might even bail on WNR and get into something at C2EE.

Jeff I know you're busy and all but if you were looking at WNR would you be thinking "Hmmm, this seems to have run a bit here and is going to bounce." or "This still has a way to go. I will sit out the bounce and lose some of the unrealized gains, and then ride it back down." A or B.

Or C (the ubiquitous "none of the above")

RL close to breaking down.

Re technical difficulties: no worries, mate.

Even a ROCK STAR, such as your self has a 'power outage' on occasion. [Jack Black, in the movie 'Vacation', "The man is a ROCK STAR!"]

I see a lovely H&S on RL but that was a 10 pt. play and it's already down 8. 65 would be my target (or "tarjay" as we say in Canada.) and it's at 67 now. My hunch is that there may be some consolidation around 65 before it heads lower.

Just a guess from an inmate of the Dungeon of Shame.


That is a nice entry on MTRX, I am assuming this is a stock trade?

I shy away from stocks that trade 200k shares on heavy volume days ;-)

How did vegas go?

Jeff, I am waiting - thanks!

Chris, I like C2EE much better than BEE maybe BPEE would be better for Pam and I.

I may be entrying the land of no stops soon. Pam's paper account had no stops and is doing great now while our real account with stops is well underwhelming.


The difference is the price action. Compare the two.


I'd take profits on the short/puts here.

MTRX is most certainly NOT a stock trade.

Jeff, my request is that you kick it old school and post a LIST of the watchlist instead. This would be a very educational exercise in that everyone can figure out the price patterns on their own.

RL, bear flag? Anyone agree?

MDC is back almost at REE. My nice profits on this one evaporated yesterday and today it's sniggling back to it's diagonal support.

I need a few more bullish trades to balance my account. Something strange is going on here though. TOS under net shares shows -133 and under analyze 119. Which do I believe?

sniggle - verb (used without object)
to fish for eels by thrusting a baited hook into their lurking places.
–verb (used with object) to catch by sniggling.

HA!!! I thrust my baited hook into your lurking place and you bit!!

MDC is a bit of a slippery eel. Thus the sniggle.




It would have to be B(P)EE but most certainly could NOT be PEE.

You choose.

If you're looking for a good call... have a look at CTRP, RIMM, STRA, DVA... you could pick almost anything from Jeff's watch list last week. They all broke a bit and then settled back to REE.

Trying to understand price action with Krystal's question - do you mean that there is more volume on the buys than the sells?

I'm looking forward to listening to the Open House from last night- I was one of the unlucky ones to have the audio not work.

Thanks again, Jeff and OA's for all of your help.

Sometimes the analyze tab on TOS will include trades you've recently gotten out of or have analyzed which will change the net shares. I'd stick with the monitor tab.

Lis, the two differences I saw:

On HANS, the blood red candle on pretty good volume actually broke through AND closed below a trendline that I had drawn in.

On CMG, the volume was lighter and did NOT close below the trendline.

Of course, this analysis assumes that my trendlines are well-drawn.

Is that what makes these two different, Jeff?

Brett, I like MTRX thanks.

Homebuilders all got a bump yesterday on what I would assume would be pre-pricing in a FED rate cut? Looks short lived (or maybe I am hoping it is) so these puts I am holding continue down.

If I do the old manual way (which I am not sure is right) +1 delta for stock and +100 per contract and minus for puts etc. I come up with -440 while TOS monitor is at -156 now. What am I doing wrong here?

MTRX - I like the entry and have taken a couple Dec. calls because I see the flag breakout today.
Thanks Brett.

Each contract will have it's own delta. A share has a delta of 1 because for every dollar it moves you make (or lose) a dollar. But with the options a move of a dollar results in less movement of the option. Most contracts OTM run a delta around .50

You'd have to check delta of each of your contracts to come up with a number. I'd guess TOS would be pretty accurate. Remember... delta's always changing, too.

On RL I don't see the H&S - what I am looking at is support on a 5yr chart at about 62.50 for a target and a break below 67 which provides good SEE and R:R.

And now that VA Beach Girl mentions it, if this is indeed a bear flag, then that target would also be around 62-63 by my analysis.

FDS, is a stock I have tracked before. This is bouncing off horizontal support on the daily chart. I also see it sitting at diagnal support on the 2 and 5 min charts.
Could be a good entry today if it fits your rules.


Where's the volume today? Pfffftt.


Thanks Chris, for being so kind. I really shouldn't be doing this while sick as my brain is just not clear.

I did a project bid with one of my guys yesterday and forgot to include all the buildings we are treating on a government job - that would have been a big oops.

I have to get to the doctor to clear this up and this smoke is not helping at all.

so far not impressed with today's price action.It should be a whole lot stronger. There may be another leg lower. Be watchful and cautious.

For those END of DAY TRADERS. My friend just told me something about end of day,because I keep breaking that rule. He said when you're swing trading you are getting information for tomorrow, not today. therefore the best information comes towards the end of the day for entries and exits.

Sometimes when I enter or exit early it works in my favor. But if I track all y trades,the end of day trading farrrr out performs everything.

BUCY breaking out today. Deck retesting - possible good entry.

I sold OI today as it fell below the diagonal trendline I had drawn.

Anyone out there holding AMZN over earnings? I am going to hold it, but trying to decide how many contracts to keep. I'm leaning towards selling half.

James H.

I'm holding AMZN over earnings. Just 1 contract.

Watch earnings on both BUCY and DECK btw!

James H.

I'm holding 1 contract over earnings and am risking 100% of the option which is still within my 1% rule.

I had 5 AMZN contracts and decided to sell 3. I'm holding 2 over earnings and put the proceeds of the other 3 into DECK and DAKT.

Does anyone here day trade options? Normally I wouldn't but so far I have done it with AAPL and GOOG with success after earnings since everything is so liquid and moves in usually a larger range.

Maybe I can continue with success on other favorites? AMZN? BIDU? FCX?

I sold my contract I had at the open for a nice gain, then watched the stock tumble, wait for a break of the down trend then bought calls and snagged a quick profit there as well, again left some on the table but oh well. Up 5% for the day, can't complain.

It could be nice to use this strategy if it is successful around earnings and keep the usual plan in between.

anyone else doing something similar?


James H., did you notice the upcoming earnings and IV on DECK?...

UAUA is breaking out of an AT after a great earnings report last night.

FSLR - is there any way to figure a price target on this?

Thanks for any input.


I'll see your UAUA and raise you a GOL.

don't you just love trading support bounces only to them become break outs. If only I understood that concepts when I first started w/ investools. Break out,no no too far from support. Bounces that become breakouts.....YES!! low risk,big rewards.

go FSLR!


Thanks. Yes I did notice the earnings. I posted about it earlier today (1 post after I mentioned DECK). I didn't look at the IV though. Thanks for pointing that out.

What I did look at is the nice cup and handle pattern, the fact that I could buy it today with little risk - my exit point is $113.50. My price target for the cup and handle is 138. An argument could also be made for a $145 price target based on S/R.

As far as earnings, in the past 5 quarters, DECK has beaten earnings by >38.5% every quarter. Last quarter, DECK more than doubled its earnings from the same quarter last year.

So overall, assuming earnings don't go poorly I've got a huge reward potential for my risk, with the main risk being earnings. And after looking at earnings, while I always hate guessing at earnings, DECK does have a good history that makes it less risky to me. And even that risk is worth it to me with the huge upside.

This was by no means meant to discredit you pointing out the earnings/IV. I plain forgot to look at that, and it is super high. I merely wanted to show my thought process in case it helped anyone else. I appreciate your response.

James H.

Target on FSLR hmmmmm. I entered around 102 and was looking for 120. and now look. before I took it around 60 all the way to 118 earlier this year. So if I had to guess, min 160,but I'm really thinking 200.

Jeff should chime in I believe he took this trade.

Also on DECK, the main thing I looked at was the huge 10+ point breakout yesterday on huge volume. That is what turned me on to it first before the above analysis.

James H.


I forgot to mention that I have the Nov. 145C. That might not give me enough time for 200. The computer on ProphetChart shows a Triangle Bullish Pattern w/ a predicted range of 132.34 to 160.06 in the period from 9/21/07 to 11/21/07. I've noticed that these patterns are often accurate, but not always. Any thought?

Nov 145's so you are now ATM. watch it carefully,it swings alot , but usually makes its move at the end of the day. With so little time left, don't hesitate to take profits,besides I think earnings are coming up very soon.


On GOL, are you looking at and INV. H&S retest?

I like the set up.

Does anyone have any news for FCX. Earnings tomorrow...should I hold, or should I sell... decisions to be made.

FSLR earnings I believe is 10/31. Last quarter it was ugly . so if you hold trade small.

Sarah, do you own the stock on FSLR?

No I have Dec's




Thanks for your input. I actually got called out. Even though it's going higher as I type, I have no regrets. I have watched too many profits come and go before.

Anybody know what is going on with RIMM?



Good news:

RIM surges on China smartphone distribution pact
Tuesday October 23, 2:25 pm ET

NEW YORK (Reuters) - Shares of BlackBerry maker Research in Motion Ltd (Toronto:RIM.TO - News; NasdaqGS:RIMM - News) jumped more than 6 percent to a record $121.10 on Tuesday after the company announced it had entered a deal to distribute its BlackBerry smartphones in China with Alcatel-Lucent (NYSE:ALU - News).

Hope that your enjoying it as much as I am!


Do you know where I can find the recording of the Monday class?


Not really but if you are looking to invest you can try
Its a great reviews site :-)

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About me

  • I'm Option Addict
  • From Saratoga Springs, Utah, United States
  • I am a professional trader and an instructor for Investools. I've had relations with the markets for 9 years. Born in Concord, CA, but reside in Saratoga Springs, Utah. Father of THREE, Husband of one.
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