Slow marketshe

The markets are just meandering around on low volume.  We probably won't see a meaningful direction until next year.  It would be nice to see a leader rotation and some new leaders emerge as some of the older leaders look maxed out.   Let's see what the new year brings...

New positions - Stock - AMZN, ORCL, NVDA

I have opened new long positions in Amazon (AMZN), Oracle (ORCL) and Nvidia (NVDA). 
Entry prices:  AMZN 182.79,  ORCL 31.85 , NVDA  14.83

Dec update

Due to a lack of time to pay attention to my positions, the majority of the positions expired worthless.  I did manage to sell some positions here and there.  So as a result, my year to date return (since I started the blog) is now back down to about 100%.  Since I was up 200%+ at the peak, the market has taken back quite a bit of the gains.  So I am going to start thinking about switching to a swing trading strategy with 2-3 month time frame (playing longer term options instead of front month positions).

Oracle (ORCL) is looking very promising.  I am eyeing the Mar 32 calls for around 1.29 each.

I am also trying to look at the big cloud computing players and determine which ones to buy (the major players are Google, Amazon, Microsoft, IBM, and Salesforce.com (CRM).  Although it is tough to enter a position in a stock that is up from 25 to 135 in the last two years.  But cloud computing is starting to take off at the enterprise level, and is a field that will grow exponentially for the next few years.  Amazon stock chart looks really good as its coming out of a 10 yr base and doesn't look too over extended.  Combine that with a high short interest, and we could be in for a nice rally soon.

Other players that will benefits from this cloud computing trend are EMC (storage) and VMWare (Virtualization platform).  I will monitor these stocks and probably take long positions when opportunity presents itself.  Dell is also getting in the space as a reseller for cloud computing.  Combine that with the fact that Michael Dell just bought a $100 million dollars worth of DELL stock, and there just might be some hope (and the stock pattern looks promising as well).  I am not sure I will get any options on that stock, but I may add some to a long term hold portfolio. 

Position Updates

I closed out the calls in STEC and YHOO.  The order for YHOO Dec 17 calls executed at 0.51 (bought around 0.50) and the STEC Dec 17 calls sold at 0.89 per share (bought around 1.20+) for a loss.  I will continue to try and close out the remaining positions since I am no longer watching the market closely.  I will be working on a Swing Trading shift in my strategy and see how that works out.

Start thinking about closing out Dec calls

It is time to start closing out the Dec calls as opportunities present themselves.  Market looks very unpredictable with drops possible.  Although you would think that with the tax deal on the table, markets would react positively (but they may not until a definite deal is reached).  Still, we won't see much of the impact of the deal until next year with the temporary social security withholding cuts, so Dec options may not perform very well.  We have about a week and a 1/2 left on those options, and time decay is about to really accelerate...

OVTI and other portfolio updates

If you haven't taken profits on your OVTI position, this is a good time to do so.   The options purchases at 2.35 were bid at 4.80 and ask at 5.00 today.

I am looking for a slow DOW day tomorrow.  A strong up day will not be sustainable by the market and will end up in a pull back next week.  I would rather see the market have a slow sideways day tomorrow and that another nice rally next week.

We need Macy (M) to start makings its move soon or the option premium will start to erode at a rapid pace.  Daily indicators are not favorable yet the weekly chart still looks promising.  Unfortunately, the play I made was with Dec options, so the stock needs to move soon.  I may be moving my targeted sell price of $5 down to around 2 or so soon. 

IPG has started moving a bit.  If the stock can move another quarter or so, I may be tempted to get out.  The Dec 11 calls are bid at 0.20 and ask at 0.30 at present.

Logitech is trying to rally again.  If you look back a few days, you will realize that the stock jumped strongly and I closed out 1/2 the position at a 200% gain.  Then the stock continued up that day, and the options were up 400 percent.  But instead of closing the position, I decided to hold onto the rest of the options.  The stock then proceeded to give back all the gains and all my option gains evaporated.  The options are profitable again, and the chart is looking good.  But I think I will get out around 2.00 if the stock happens to hit the right price point.

The STEC calls are now at a 50% loss.  If the stock is going to rally, the time is now.  I will  be happy to break even at this point.  So still continuing to hold on to the position for now.

The Merck (MRK) options are pretty much worthless but that was a gamble I took with the expectation of losing the entire amount because the reward if the stock broke to the upside was huge.  MRK, however, disappointed with their earnings and outlook, and the result was a complete loss of option value.

The YHOO options were up 100% and I didn't take the profits (not even on half the position).  That cost me and now the options are 50% of what I paid.  Maybe someone will buy them out soon or at least spread the rumor that they will :-)

I think you can see the recurrent theme here.  You should always take profits if your options jump up 100% (even if it is on 1/2 of your position).  That way you at least guarantee preservation of capital and even a small profit.