Published on
October 8, 2009,
9:08 pm in
Daily and Trading.
Tags: CHIP, DXD, DZZ, ERY, ES, OPXA, SDS, TBT, TZA.
Traders were happy with AA earnings and futures were up all night. Adding in a good jobs report and many stocks gapped up at the open. My spec plays from yesterday were flops. Both CHIP and OPXA floundered around to the down side, but not so much as to stop me out. Most of my trading activities were in the futures before the cash markets opened. I couldn’t sleep last night, so I got up early, like 4AM, and enjoyed some quiet trading. Using 1 car, I traded short 2x and long 2x and walked away with 45 ticks before the open….so it was a good day by morning 
The other exceptional play I had was entering some TBT calls before the auction results. TBT is the Ultra short 20+ year Treasury ETF. You would buy this when you think interest rates are going up. After the auction results were announced, the calls popped up 20%…and within another 30 minutes they climbed another 15%, so I cashed out with a 35% gain in about an hour’s time. That was one of those trades where you kick yourself saying, “Why didn’t I buy more?”
The markets have been up every day this week, so I’m thinking traders may be taking profits before the weekend. I also think that Gold may be getting a little ahead of itself. So I’m making a watchlist of several short ETFs, as in: DZZ SDS TZA DXD ERY. I’m also looking at re-entering TBT calls on any pullback. And I’ll probably be shorting ES….unless of course, the bulls come out and chase the bears away.
And for your reading enjoyment:
The Weak-Dollar Threat to Prosperity
…can’t trust that day, as the Mamas & Papas sang. The markets were still hungover from that Friday drunk of housing magic and Benny cheerleading. 
But eventually the buzz wore off and it looks like it may be a couple days before we can party again. The bulls were happy happy this morning, but got tired real fast and started falling over by afternoon.
Of course me sitting in 3x short ETFs made for an uncomfortable morning. Sure I nickeled and dimed myself going for some longs like ERX and TNA, while still holding ERY and TZA, but I made some realized profits while still enduring unrealized losses. Near the close I added BGZ to the mix.
So far the futures are agreeing with my prognosis of some downward momentum, but 11 hours is a long time. Let’s see what the rest of the world thinks.
Yesterday, I wrote a diatribe on the supposedly optimistic housing number. Then today I see in the Wall Street Journal this little article: Fewer Delinquent Mortgage Borrowers Are Catching Up.
Because borrowers are less willing or able to catch up on payments, foreclosures are likely to remain a big problem. Barclays Capital projects the number of foreclosed homes for sale will peak at 1.15 million in mid-2010, up from an estimated 688,000 as of July 1.
That’s not a housing boom. Is it?
Yes! The overnight short positions worked yet again on the 4th try. And again, for maximum profits I had to close the positions in the premarket or very soon after market open. So why mess with a good thing? I’m gonna try for 5 out of 5.
I again went short the market via TZA, but I also am trying to short oil via ERY, the 3x energy bear ETF. What the hell, it’s been a good week, why not go for it?
My web hosting service has told me they are migrating my website, but “don’t worry” nothing will change….famous last words. So I’m keeping it short so I can test out the new digs. I hope there are no problems…and thanks for visiting.
That’s all I heard today and read all weekend….Head & Shoulders. Well, it must be working, because none of my charts show any dandruff. 
Today also reminded me of the day after the Memorial Day holiday….which also happened to be an up day, strange market action, as twice now the market has been positive after a holiday weekend.
I went to cash before the holiday, so I didn’t care what happened this morning. But after I saw the futures down and the market going down at the open, I thought how nice it would have been if I had held on to my TZA and ERY!
During the morning I did see a scalp opportunity in BGZ so I quickly made 50 cents in about 10 minutes. But after that I couldn’t keep track of all the ups and downs I kept running into. So I sat back. After the markets started to recover I looked for some longs to get, but still was a little scared in any direction. At the end of the day I nibbled on some DYY, the commodity double long, which looked very oversold. We’ll see….
With the Dow and S&P500 closing up today, after being down so much in the morning, we may see some bouncing in the morning….another “turnaround Tuesday?” We’ll see….
The day I have been positioning myself for, has happened…..and in a big way. I was done trading by 10:30AM EDT. Prior to the Employment Report I entered ERY, the 3x Energy Bear ETF, and was still holding on to TZA, QID and QQQQ puts from last Friday. I had sold off half of my position yesterday to try to minimize losses (see yesterday’s post). But today, I covered all those losses, paid the mortgage and have beer money for weeks to come.
Now though, the markets are like watching paint dry. It is after lunch, major players have moved on to the Hamptons and the S&P pit is quiet, zzzzzzz. I’ve popped the top off my first Bud Light and will sit back and look at all the pretty colored lines and blinking watchlists. Have a Happy 4th of July weekend….and God Bless America!
