May 5, 2014
Market Strategies Newsletter
Where To Invest Your Money
May 2014
Sample Issue
Covering High Return Balanced Investing Strategies To
Make Money In Up Or Down Markets
Over 284% Gains In 2013
For Free Where To Invest Your Money Now
High Return Investments Trade Alerts
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Market Investing Strategies Newsletter
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Covering High Return Balanced Investing Strategies To
Make Money In Up Or Down Markets
A Publication of Princeton Research, Inc. (www.PrincetonResearch.com)
Contributing Staff: Michael King, Charles Moskowitz
Market Strategies
$10,000 Trading Account
Traders Comments
There are three open positions:
BA May 130 Calls
BAC May 15 Calls
XLU May 43 Puts
Funds in Use $ 1698
Loss for the week $ 171
This week we had a small loss of $171 bringing our YTD loss to $2,520
In 2013 YTD gains were $28,479
Over 284% Returns
A $10,000 Portfolio would be worth $38,479
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The market continues to grind higher in the face of sub-par performance in the GDP, Tzar Putin’s very clear intentions to grab Ukraine and who knows what after that, and a host of news that should have crushed equities. Even the good news was questionable.
Employment numbers better than expected but the secondary issue of the participation rate continues to fall. And yet the market continues to have a mind of its own. This market seems to be the textbook example of “The trend is your friend,” with most technical tests resolving to the upside. From a technical point of view every market takes on its own character. The resolution of what a lot of people have called “Head and Shoulders” tops has been the upside breakout. It has happens often and with sizable runs through old highs, putting in place another area of support.
A look at the daily chart of FB (below) is an excellent example. Some are calling this as a H & S … Left shoulder from mid-December until the big gap up on earnings at the end of Jan, head from mid-February and the right shoulder from late March until now. Slanted neckline that I believe is actually support. A close over $64 and the old highs will be exceeded on the way to $75.
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Market Strategies $10,000 Trading Account
Trade Table
New Trades:
1) Buy 6 June 21st FB $ 65 Calls @ $ 1.05
DATE | TRADES | PRICE | COST | PROCEEDS | RESULTS |
05/01 | Sold 6 TBT May 66 Calls ( 50% Loss Rule ) | 0.55 | 330 | 330 Loss | |
04/30 | Bought 4 BA May 130 Calls | 1.27 | 508 | ||
04/29 | Bought 10 BAC May 15 Calls | 0.43 | 430 | ||
04/29 | Bought 6 TBT May 66 Calls | 1.10 | 660 | ||
04/28 | Sold 2 BIIB May 270 Puts | 4.72 | 944 | 64 Gain | |
04/28 | Sold 5 SPY May 185 Puts | 2.01 | 1005 | 95 Gain | |
04/25 | Bought 5 SPY May 185 Puts | 1.82 | 910 | ||
04/25 | Bought 2 BIIB May 270 Puts | 4.40 | 880 | ||
04/21 | Bought 8 XLU May 43 Puts | 0.95 | 760 |
Remember, these trades are based on your participation in the
TEXTING SERVICE TO RECEIVE ALL UPDATES.
Previous closed out trades not listed here may be seen in previous market letters in the
Options Trading Strategies Notes: In Texting we have a limited amount of words. In the interest of brevity: we use 8=August , 9=September . The Quantity and Strike Price for each trade is specific.
We may trade weekly options and they are noted: SPY 1/25 147 for SPY Jan 25th 147 calls or puts.
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Market Laboratory
Weekly Changes For market Indicators
Prices are copied from Barron’s Weekly and Yahoo Finance and may be incorrect
Dow16,512.89+151.43+0.93% | Nasdaq4123.90+48.34+1.19% | S&P 5001881.14+17.74+0.95% | Transportation7698.84+112.70+1.49% | Russell 20001128.80+5.77+0.51% | Nasdaq 1003587.64+54.55+1.54% |
Gold (spot)1302.60+1.90+0.15% | Silver (Dec )1954.6-17.2-0.9% | Crude99.76-0.84-0.8% | Heating Oil292.23-5.86-2.0% | Unleaded Gas2.9445-0.0821-2.7% | Natural Gas4.647+0.027+0.6% |
VIX12.91-1.15-8.2% | Put/Call RatiosS&P 100167/100’s+30/100’s | Put/Call RatiosCBOE Equity61/100’s+1/100’s |
Bonds 136-06 +1-08 3.368% -0.077% |
10 Yr Note124-02 +192.585% -0.07% | Copper307.00-5.45-1.7% |
CRB InflationIndex307.14-3.55
-1.1% |
Barron’s Confidence71.3%-0.6% | S&P100833.86+8.30+1.01% |
5 Yr Note 119-147 +09 1.666% -0.062%
|
Dollar79.51-0.24-0.3% | DJ Utilities543.81-7.85-1.42% |
AAIIConfidenceIndex |
Bullish 29.8% -4.7% |
Bearish 29.5% +3.5% |
Neutral 40.7% +1.2% |
M1 Money Supply +9.31% April21st |
M-2 Money Supply +6.57% April 21st |
M1…all money in hands of the public, Time Deposits Traveler’s Checks, Demand Deposits
M2.. adds Savings and Money Market Accounts both compared with the previous year.
New Stock Recommendations
$ 100,000 account
1) Buy 5,000 shares GLXZ at $ 0.44
Each stock is allocated a theoretical $ 5,000 share of the portfolio unless otherwise indicated.
Stock | Purchase Price | Purchase Date | Stop/Loss | Price/Date Sold | Profit/(Loss) | ||||
SPXU 200Leaves 100 | 54.74 | 04/22 | 53.67sco | 04/25 sold 100 only@ 56.33 | $ 159 | ||||
XRGYF 5000* | 0.407 | 03/14 | |||||||
OSIR 300 | 15.94 | 02/13 | |||||||
INSM 300 | 15.37 | 01/29 | |||||||
GRPN 500 | 10.40 | 01/28 | |||||||
AA 300 | 11.79 | 01/28 | 04/24 13.66 | $ 561 | |||||
RPTP 400 | 15.37 | 01/16 | |||||||
AA 500 | 10.06 | 01/10 | |||||||
WLT 300 | 16.22 | 12/23 | |||||||
GSG 150 | 32.64 | 12/23 | 32.21sco | ||||||
NBG 300 | 4.08 | 8/12 | |||||||
TEXQY* 200 | 6.56 | 7/11 | |||||||
NBG 300 | 12.10 | 5/23 | |||||||
HL 1000 | 4.10 | 3/04 | 2.64sco | ||||||
AAPL 10 | 538 | 11/08/12 | |||||||
AAPL 5 | 636 | 10/9/12 | |||||||
REPR* 5000 | 0.22 | 10/22/12 | .12 sco |
Recommendations will be both listed in this letter and texted to members.
Previous closed out stock and option positions can be found in past Market Strategies Newsletter issues available in the Subscriber Members Area.
For those of you who do not buy puts to protect your portfolio, there are many ETF’s that are the inverse of the DOW. The symbols are DOG, DXD, SDS,TZA and RWM, which go up when the DOW, S&P 500 and Russell 2000 go down and down when they go up. The DZZ goes up double when gold goes down.
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Market Strategies
$100,000 Trading Portfolio
Recommendations And Overall Comments
1) Buy 12 June 21st FB $ 65 Calls @ $ 1.05
We had three closed out positions last week and lost $ 278
Losses for the new year grew to $ 6,828.
For the full year 2013 we had realized gains of $ 53,556.
We have open position losses now of about $ 8,348 most of which are in small cap bio-med stocks held over from last year.
We also have not counted dividends received on stocks like Apple, Nordic American ( NAT ) and JP Morgan.
We have three long options positions:
BA May 130 Calls; BAC May 15 Calls and XLU May 43 Puts:
The Stock table has the following 15 positions:
AA, AAPL (2), DSX, GRPN, GSG, HL, INSM, NBG (2),
REPR, RPTP, TEXQY, WLT, XRGYF
The options call for a $ 2,500 investment unless otherwise stated; each stock position requires $5,000 unless specifically stated.
We are basing money management on a hypothetical
$ 100,000 and are using
$ 3,396 in three options positions and
$ 64,330 in 16 stock positions totaling
$ 67,726 with
$ 32,274 in cash.
These figures are approximate. We do not count commission costs and there may be errors.
We were unable to buy the AIVN* last week at $0.03. I was able to buy 10,000 shares at $ 0.04 the two weeks ago adding to my speculative position.
Executions that have occurred at or near the open or close of trading sometimes vary from ouractual numbers. For example, when something opens down and it is through our price, we take the next trade whether it is an uptick or continues lower. This sometimes results in a 50% trade that is slightly above or below the exact number.
Previous Week’s Recommendations and
Rules for the Market Strategies
$100,000 Portfolio Trading Account
- All options count for about $ 2,500.00 for model portfolio calculations unless otherwise stated
- When the option has doubled sell half the position
- Stop Loss protection is either half or offered with each trade
- The cost of the option is the asking price (or the price between the bid and ask, whichever is more realistic)
- The options will be followed until closed out.
- Option Symbols are stock symbol with expiration month and strike price
Option | Cost | Date | Sold | Date | Profit/(Loss) |
BA May 1308 lots | Calls 1.27 | 04/30/14 | |||
TBT May 6612 lots | Calls 1.10 | 04/29/14 | 0.55 ( 50% Loss Rule ) | 05/01/14 | ( $ 660 ) |
BAC May 1520 lots | Calls 0.43 | 04/29/14 | |||
SPY May 18510 lots | Puts 1.82 | 04/25/14 | 2.01 | 04/28/14 | $ 190 |
BIIB May 2706 lots | Puts 4.40 | 04/25/14 | 4.72 | 04/28/14 | $ 192 |
XLU May 4316 lots | Puts 0.95 | 04/21/14 |
Note: Previous closed out stock and option positions can be found in past Market Strategies Newsletter issues available in the VIP Subscribers Members Area.
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This Weeks’ Market Strategies
Economic Numbers and Media Data
Monday | Before the Open always at the top: Hecla Mining ( 00 vs 0.01)PFE ( 0.55 vs 0.54 ) Sysco .39 vs 0.49 TSN ( 0.63 vs 0.36 )10:00 hrs ISM Services Apr ( 54.0% vs 53.1% )After the close: APC: 1.14 vs 1.08 EOG 1.19 vs 1.80
RGR: 1.12 vs 1.20 Tenet -0.14 vs 0.33 WG .07 vs -0.24 |
Tuesday | DNR .25 vs .33 HSIC ( 1.13 vs 1.06 ) NUS 0.94 vs 0.9008:30 hrs Trade Balance March ( -$42.5B vs -$42.3B )FSLR ( 0.52 vs 0.69 ) Groupon ( -0.03 vs +0.03 )PZZA ( 0.45 vs 0.84 ) Sothebys ( -0.13 vs -0.33 )
DIS 0.96 vs 0.79 Whole Foods 0.41 vs 0.76 |
Wednesday | AOL ( 0.46 vs 0.32 ) CHK ( 0.48 vs 0.30 )Devon Energy DVN: ( 1.27 vs 0.66 )07:00 hrs MBA Mortgage Index 05/03 ( NA )08:30 hrs Productivity-Prel 1st Qtr ( -1.2% vs 1.8% )08:30 hrs Unit Labor Costs 1st Qtr ( 2.5% vs -0.1% )
10:30 hrs Crude Inventories 05/03 ( NA vs 1.698 Mln bbls ) 15:00 hrs Consumer Credit March ( $ 16.1B vs $ 16.5B ) Avis ( CAR: 0.08 vs 0.08 ) CXW 0.43 vs 0.50 Tesla ( TSLA 0.06 vs 0.12 ) |
Thursday | APA 1.64 vs 2.02 DISH 0.44 vs 0.47 HCN 0.98 vs 0.9108:30 hrs Initial Claims 05/03 ( 325K vs 344K )Continuing Claims 04/26 ( 2750K vs 2771K )10:30 hrs Natural Gas Inventories ( NA vs 82 BCF
Con Ed ( ED 1.05 vs 1.08 ) |
Friday | Cdn Nat Resources ( CNQ 0.81 vs 0.37 )10:00 hrs Wholesale Inventories March ( 1.0% vs 0.5% )Ave Workweek ( 34.5 vs Same )10:00 hrs Factory Orders Mar ( 1.6% vs 1.6% )
10:00 hrs JOLTS – Job Openings ( NA vs 4.173 Mln ) Tutor Perini ( TPC 0.20 vs 0.31 ) Vectren ( VVC 0.74 vs 0.61 ) |
Market Strategies Economic Data
Nonfarm Payrolls added 288,000 jobs in April, and another 11,000 jobs added from the revised March numbers, which amounts to 300,000 jobs. It confirms that the weather-related bounce back is happening. There is little doubt that the economy is performing in sectors. of the economy – not home building as both the industry and banks remain hampered by onerous legislation. The Unemployment Rate dropped to 6.3% in April from 6.7% in March well below the consensus which expected 6.6%.
The third largest drop in the US unemployment rate ever recorded (+6.7% to +6.3%) has managed to push the middle of the US curve (5-year Tsy’s to +1.77% and 10’s to +2.66%). The Participation rate ( the civilian labor force ) has dropped by 806,000, to 62.8% from 63.2%, a material offset to an otherwise excellent report. The average workweek remained at 34.5 in April, while there was no improvement in hourly earnings..
Digging deeper, the stronger than expected report (+288k vs. +216%) managed to provide broad based gains across many job classifications in April. However, this may be a tough act to follow as many workers affected by the expiration of the emergency unemployment benefits completely left the labor force. Indeed, the household survey actually showed an outright decline in employment (-73k). The payroll data showed that Goods Producing rose 53,000 out of which Construction added 32,000 Manufacturing up 12,000.
Service Providing Jobs rose by 220,000 led by Retail Trade up 35,000; Education and Health gained 40,000; Miscellaneous Businesses added 75,000 and the beleaguered Financial Industry up 6,000. Also, there was another sharp jump in the Temporary help category,+24,000. Government Employment rose by 15,000 jobs.
The headline number of plus 288,000 new jobs caused the 10-year Treasury yield to jump to 2.69% from 2.62%. But the rate soon retreated first when it was clear that the labor force had shrunk; but then later when Russia asked the United Nations Security Council to meet over Ukraine, the 10-year note yield fell to 2.585% and the 30-Year yield fell to an 11- month low of 3.37%. Crude Oil prices also retreated below the $ 100/Bbl mark.
Market Strategies Trading Fundamentals
Germany has been most explicit about the costs for its economy from increased Russian sanctions; Chancellor Merkel no doubt let Pres. Obama know this in no uncertain terms when the two leaders met last week that there will be no sanctions. EU-Russian trade totals more than 370B/year vs just $26B/year for U.S. trade with Russia. More than half of Russia’s exports go to Europe and 45% of its imports come from Europe, and Russia supplies almost one-third the 485B cubic meters/year of gas consumed by the EU.
The situation in Ukraine appears to be deteriorating, as a Ukrainian government offensive reportedly killed several pro-Russia rebels, and separatists shot down two Ukrainian army helicopters.
5-year, long-toothed recovery makes many investment observers fearful of a serious price “consolidation”. A near-50% gain in the last 2 years heightens the concerns. Both the QQQ and Nasdaq which usually lead rallies are faltering. The only way to take risk in this market is to buy value.
Market Strategies Technical Information
Support Levels S&P 500 1846
Resistance S&P 500 1897
Support Levels DOW 16,380
Resistance DOW 16,680
Support Levels QQQ 84.90
Resistance QQQ 88.20
Support Levels NASDAQ 3920 – 4040
Resistance NASDAQ 4175
Market Strategies Cycles
The Stock Market Almanac to which we subscribe and follow, has published the work of Sam Stovall, Managing Director U.S. Equity Strategy S&P Capital IQ, who has done an excellent recent piece on the worst six months for the S&P 500 with and overlay on the midterm year.
Stovall’s research confirms our findings that not only has the market performed poorest in May-October, but it’s even worse in the midterm year. This trend is well-known and the market momentum has been muted this year. Price changes from the end of last year are miniscule.
Facebook ( FB: $ 60.41 ) is likely a buy at its 13 day moving average, about $ 60. A close above its 50 day M.A. at about $ 65 would be very impressive and could happen. Otherwise, it is a candidate to buy on market set-backs.
FB has improved its operational efficiency over the last few quarters and it has increased the scale of its operation indicating that it is still in its growth phase (see graph above). The GAAP operating margin was 43% and non-GAAP operating margin was 55% in Q1 of 2014. FB’s high growth rates for its top and bottom lines coupled with increasing operating margins shows that its core operations are doing very well.
FB’s focus on its core products and business is important for keeping its users interested and engaged and FB is doing well so far in this regard.
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Rule 17B Attestations
Princeton has approximately 2,581,578 shares of AIVN both free and restricted and represents them for I.R.. Princeton also has about 40,000 shares of TXGE. Princeton is paid $ 1,500 per month from RMS Medical Products. Princeton has bought 81,100 shares of RMS Medical Products. Princeton Research has been paid $ 2,500 to write a report on Xinergy.
Princeton has been engaged by Target Energy. No contract is currently in place. When there is no movement in penny stocks, even though there is none or very small losses, we will liquidate ( sold AIVN on stop ) even though we like the company, if money is needed for better opportunities.
We now believe REPR represents upside opportunity. The Target ADR trades at about $ 4.50 in U.S. vs 0.045 in Australia. Princeton owns 400,000 Australia shares and about 500 U.S. ADR’s. Princeton is paid about 500,000 shares of Leo Motors.
Pursuant to the provisions of Rule 206 (4) of the Investment Advisers Act of 1940, readers should recognize that not all recommendations made in the future will be profitable or will equal the performance of any recommendations referred to in this Email issue. Princeton may buy or sell its free-trading shares in companies it represents at any time.
CONTACT
Please Direct All Inquiries To:
Mike King
(702) 650-3000
Princeton Research
3887 Pacific Street,
Las Vegas, Nevada 89121
Fax: (702) 697-8944
Visit: www.PrincetonResearch.com
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