Market Strategies Newsletter June 18, 2012 Options Trading Strategies

Options Trading Strategies

Where To Invest Now

Market Strategies Newsletter

 Options Trading Strategies

Covering High Return Balanced Investing Success Strategies For

Stocks ■ Bonds ■ Interest Rates ■ Natural Resources ■ Currencies ■ Venture Capital ■ Gold

A Publication of Princeton Research, Inc. (www.PrincetonResearch.com)

Contributing Staff: Michael King, Bill Chippas, Charles Moskowitz

June 18, 2012

Market Strategies Newsletter

Where To Invest Now,

Stocks To Buy And

Options Trading Strategies

 

Make Money In Up Or Down Markets.

To Get Our Trade Alerts By Text Message And

The Complete VIP Members Only

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Use The Subscribe Offer Button To Your Right.

 

Options Trading Strategies

$10,000 Options Trading Portfolio

New Options Trades for this week:

The high volatility and news flow necessitates new trades to be sent by Text for this week.

The $10,000 Options Trading

Strategies Account had a

Gain last week of $1,172

increasing our gains for the year from

$3,402 to $4,574.

Two positions remain:

The BAC warrants and the

IWM July 80 Calls.

The Open positions are highlighted in the options table below.

Approximately $ 1,449 funds are in use.

 

The markets closed the week with a strong breakout on the charts of the major averages.

This should lead to bigger gains in the weeks ahead.

The issues of Greece, Spain, Italy and Egypt may be discounted by the market but we still have the headline risk from these overnight, seemingly every night.  The political climate here at home still focuses on the presidential race and unfortunately we will have to endure all of the rhetoric for months to come.  The issue of “who caused it” without any suitable suggestions on how to fix it masks the real issues.  The presidential “decree” on Friday that we will just ignore a law already on the books “because it’s the right thing to do” is completely outside the scope of authority of anyone.

One of the comments made on Stephanopoulos really hit home for me.  Unfortunately I don’t recall who to credit but it was “US corporations have over $1 trillion abroad…Give the companies a break to bring it home and we would have a NO COST stimulus to the economy.” Simple ideas that seem to be above the heads of those in power.

I am waiting to add new trades until I see what the overnight news brings to the market.  My inclination is to go counter the trend if we get a big gap in either direction.  DJIA resistance for me is the area at which we broke down out of the BEAR flag in early May (12850-12900) The S. & P. 500 area is 1365-1380.  On the downside my buy points are 12,360-12,400 and 1295-1305 respectively.

Please follow the free text updates for new trades…CAM

Make Money In Up Or Down Markets.

To Get Our Trade Alerts By Text Message And

The Complete VIP Members Only

Market Strategies Newsletter Issues

Use The Subscribe Offer Button To Your Right.

Previous closed out trades not listed here may be seen in the March, February and January weekly newsletters. See past issues at http://www.princetonresearch.com/market-strategies-newsletter/

DATE

TRADE

PRICE

COST

PROCEEDS

RESULTS

6/15

Sold 10 XLF July 14 Puts

.38

380

130 Loss

6/15

Sold 6 AIG July 32 Calls

1.26

756

222 Gain

6/15

Sold 10 TBT July 17 Calls

.28

280

90 Loss

6/14

Bought 10 XLF July 14 Puts

.51

510

6/13

Sold 5 MCD July 87 Calls

2.69

1345

485 Gain

6/12

Sold 10 SLV July 29 Calls

.73

730

80 Gain

6/12

Bought 5 MCD July 87 Calls

1.72

860

6/11

Bought 6 AIG July 32 Calls

.89

534

6/11

Bought 6 IWM July 80 Calls

1.24

744

6/11

Sold 5 MCD July 87.50 Calls

2.72

1360

605 Gain

6/11

Bought 10 TBT July 17 Calls

.37

370

6/8

Bought 5 MCD July 87.50 Calls

1.51

755

6/8

Bought 10 SLV July 29 Calls

.65

650

5/23

Bought 1000 BAC.WS.B

.705

705

New trades $ 10,000 account…In Texting we have a limited amount of words. In the interest of brevity: OPTIONS ONLY: 7 July, 8 August . The Quantity and Strike Price for each trade is specific.

For any questions please call 702 650 3000


Market Laboratory – Weekly Changes

Prices are copied from Barron’s Weekly and Yahoo Finance and may be incorrect

Dow

12767.17

  +212.97

+1.70%

Nasdaq

2872.80

+14.38

+0.50%

S&P 500

1342.84

+17.18

+1.30%

Transportation

5091.42

+29.19

+0.58%

Russell 2000

771.32

+2.13

+0.28%

Nasdaq 100

2571.23

+12.02

+0.47%

Gold

1628.10

 +36.70

+2.31%

Silver

2874.0

+26.9

   +0.94%

Crude

84.03

  -0.07

-0.0%

Heating Oil

264.65

-2.56

-0.96%

Unleaded Gas

2.7017

+.0165

+0.6%

Natural Gas

2.467
+0.168
+7.3%

VIX

21.11

-0.12

-0.6%

Put/Call Ratios

S&P 100

146/100’s

+19/100’s

   Put/Call Ratios    CBOE Equity78/100’s

+7/100’s

Bonds

149-21 +1-0

2.69% -0.07%

10 Yr Note

133-25 +0-96                                               1.59% -0.05%

Copper

338.35

+9.85

+3.0%

CRB Inflation

Index

272.23

-0.68

-0.25%

Barron’s Confidence

68.0.%

-0.4%

S&P100

614.84

+9.22

+1.52%

5 Yr Note

124-047 +0-7                                                   0.68% -0.03%

Dollar

81.60

        -0.96

-1.2%

DJ Utilities

483.05

+4.57

+0.96%

AAII

Confidence

Index

Bullish

34.0

+6.5%

Bearish

35.8%

-10.0%

Neutral

30.2%

+3.4 %

M1 Money  Supply

+15.67%June4th

M-2 Money

Supply

+9.32%June4th


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


BUY 150 FB AT $30.10 OR BETTER

Last week we bought AAPL and with a TEXT Alert we Sold AGQ.
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)

AAPL 5

587

6/11/12

AGQ 100

40.55

6/8/12

41.27 6/14/12

72

BAC.WS.B
5000

.705

5/23/12

SNSS 2000

2.65

5/14/12

2.40 stop

AAPL 5

578

4/20/12

516.20stop

SIRI 2000

2.265

4/18/12

1.78 stop

AAPL 10

612.01

4/13/12

516.20stop

TXGE*20830       .24    4/9/12
AIVN* 10000
* 5000

.25
.225

3/12/12
3/12/12

.10 sco
.10 sco

XBOR* 2000

2.25

2/24/12

1.50sco

CISG 600

8.50

2/10/12

5.69 sco

XBOR*3570

1.40

8/12/11

0.70 sco

LEI* 2425

2.06

8/10/11

1.03x

LEOM*16650

0.30

12/17/10

0.03 sco

Note: Previous closed out stock and option positions can be found in the June 11 and newsletters dating back to July 20, 2009.  Stay alert on the free texting service for new trades and exits.


Model Portfolio Comments/Changes

There are lots of stocks that have completed what appear to be successful tests of the 200 day moving averages.  IBM is one of the best examples and on Friday the stock broke above the 25 day MA, closing on the high for both the day and week.  MCD, which we have successfully traded twice last week looks OK, but it is approaching resistance between here and 92-93.

AAPL has been a laggard on the upside and is well away from its 200 day (468 and rising), but it has consolidated nicely and can easily break the upside for a test of 600 and then the highs @ 644.

All the cross-currents from Euro news, US political considerations, and well below average growth statistics have made things highly uncertain.  Q2 earnings are just around the corner and my feeling is that we are in for more of the same in the weeks ahead.

This makes trading on the technicals all the more important and we will remain vigilant to stay both balanced and on top of all changes via the FREE testing service.  To sign up simply text the word UPDATES to 69302 and you’ll be included immediately…..CAM

 

INDEX OPTION RECOMMENDATIONS


The high volatility and news flow necessitates new trades to be sent by Text for this week.

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, SDS and RWM, whichgo 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.

 

New Stock Option Recommendations

The high volatility and news flow necessitates new trades to be sent by Text for this week.

 Option and overall Comments

We had a Gain last week of $ 2,208 in a up week. Our gain for the year was $13,142.85 and with last week’s gain has increased to $15,350.85. We have Two long options positions remaining, the IWM July 80 Calls and the CSCO Jan 20 Calls. The Stock table includes Ten long stock positions: SNSS, SIRI, AAPL (a double), TXGE, AIVN, CISG, LEI, LEOM, XBOR (a double) and BAC warrants.

The options call for a $ 2,500 investment unless otherwise started, while each stock position requires $ 5,000 unless specifically stated.

We are basing money management on a hypothetical $ 100,000.00 and are using $1,728 in the two options positions and $ 58,500 in the 10 long stock positions for a total of $ 60,228 with $ 39,772 in cash. These figures are approximate. We do not count commission costs and there may be errors.

 

Executions that have occurred at or near the open or close of trading sometimes vary from our actual 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 $ 100,000 account

Make Money In Up Or Down Markets.

To Get Our Trade Alerts By Text Message And

The Complete VIP Members Only

Market Strategies Newsletter Issues

Use The Subscribe Offer Button To Your Right.

 

  • 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
  • Subscribers can follow us on Twitter or
  • Call  702 650 3000 for up to date information.

Option

          COST

Date

Sold

 

Date

Profit/(Loss)

XLF July 14 20 Lots Puts                 51

6/14/12

.38

 

6/15/12

( 260 )

MCD July 87.5
10 Lots
Calls             1.72

6/12/12

2.69

 

6/13/12

970

AIG July 32
12 Lots
Calls              .89

6/11/12

1.26

 

6/15/12

444

IWM July 80
12 Lots
Calls             1.24

6/11/12

 

 

 

 

TBT July 1720 Lots Calls              .37

6/11/12

.28

 

6/15/12

( 180 )

SLV July 2920 Lots Calls               .65

6/8/12

.73

 

6/12/12

160

MCD July 87.510 Lots Calls             1.51

6/8/12

2.72

 

6/11/12

1210

FAZ  June 22
2 Lots
Puts             1.04

5/11/12

expired

 

6/15/12

(208)

CSCO Jan 20   3 lots Calls               .80

2/14/11

     

 

Previous closed out trades not listed here may be seen in past issues at http://www.princetonresearch.com/market-strategies-newsletter/

                                                                                              

This Weeks’ Economic Numbers and Media Data

Monday Investors will assess the Greek general election and France Parliament elections along with domestic and overseas weekend comments and events.
10:00 hrs NAHB Housing Market Index Jun ( 28 vs 29 )
Tuesday 08:30 hrs Housing Starts May ( 719K vs 717K )

08:30 hrs Building Permits May ( 725K vs 715K )
G-20 Summit in MexicoWednesday07:00 hrs MBA Mortgage Index 06/16 ( NA vs 18.0% )
10:00 hrs Crude Inventories 06/16 ( NA vs -0.191M )
12:30 hrs FOMC Rate Decision Jun  ( 0.25% vs 0.25% )ThursdaySpain Issues Bonds

08:30 hrs Initial Claims 06/16 ( 380K vs 386K )
08:30 hrs Continuing Claims 06/09 ( 3278K vs 3278K )
10:00 hrs Existing Home Sales May  ( 4.56M vs 4.62M )
10:00 hrs Philadelphia Fed Jun ( -0.2 vs -5.8 )
10:00 hrs Leading Indicators May ( 0.0% vs -0.1% )
10:00 hrs FHFA Housing Price Index  Apr ( NA vs 1.8% )
Oracle Posts Earnings Results after the close FridayInvestors will assess upcoming weekend events, Germany, Spain and Italy Meet in Rome to discuss Euro-Zone Crisis


Fundamentals

The bulls won out with the Dow leading all other indexes with a modest 1.7% gain. As the markets climbed the wall of worry, the Greek elections, it was the forward look to possible accommodative Action by the word’s bankers all meeting this week in Mexico this week plus the concomitant monthly Fed meeting. Market players believe their shoulders will be placed to the wheel to make available monies needed. The S&P gained 1.3% followed by Transportation up 0.47% and Nasdaq up the least, a meager 0.47%.

The markets opened gaped up last Monday on a buoyant note after the Euro funding of Spain but later in the session collapsed to close at the previous day’s lows on negative thinking that the rescue package was insufficient with Spanish debt at about $1.858 trillion well below their GDP of about $ 1.4 trillion. The Dow had actually made a lower low at 12,385 one tick below Friday’s low of 12,386, and a daily loss of 1%. That loss was made up over the next four days all with higher closes and the last three days ( Wednesday-Friday ) all up days leading to resistance at the 50 day moving average. The markets were aided by a dollar slide from 82.51 to 81.97 or -0.65%. The salvation might be whether they ( Central Bankers ) will mount a coordinated effort to put money in the hands of people who can move the economies forward. There is plenty of demand in America for funds but banking authorities are too stringent with restrictions. Other nations may not even have the demand.

The markets are preparing for a possible Greek exit from the Euro with central bankers loosening credit in their countries to avert panic. The Bank of England said it would offer cheap funds to UK banks provided they would provide loans to consumers. Greece with a debt of $ 420.6B and GDP at $ 212B there is a 198.6% bulge in the worsening deficit.

Jamie Dimon testified midweek which seemed like a turning point for banks as JP Morgan ( JPM: $ 35.03 ) made its best close in three weeks. It now seems poised to test its 200-day moving average at about $ 36.10.

Other banks followed. Bank of America ( BAC $ 7.90 ) had three consecutive up days to put is a 4.5% gain and just barely nudged through its 50 day moving average. However, US Bancorp ( USB: $ 31.58 ) up 4.9% had five consecutive up-days closing well above its 50 day M.A. USB may well be the best of the large U.S. banks.

 

Economic Data

It was another week of rather depressing economic numbers. The week began on a sour note with May Retail Sales -0.2% and ex Auto-0.4%, below both expectations and the prior month. The PPI fell 1% but the CORE rose the usual 0.2%. The PPI deflation was about 0.3% higher than the consensus. Business Inventories rose 0.4%, in line with thinking. However, on Thursday Initial Claims rose again 386K and Continued Claims 3278K both higher than welcome. Empire Manufacturing at just + 2.3 was well below the +13.5 consensus.

May Industrial Production was a bummer coming in at -0.1% well below April’s 1% gain which lowered Capacity utilization to 79.0% from 79.1% expected and 79.2% in April. The bulk of the decline came from a 1.5% reduction in motor vehicle production. Assembles fell from 10.67 mln in April to 10.39 mln in May.

Even Michigan Sentiment was lower at 74.1 below a consensus of 77 and the previous reading at 79.3.

 

Technical Information

Support Levels:   S&P 500           1334; 1322

Resistance S&P 500   1362; 1377

DOW            12,680; 12,530

Resistance DOW        12,890; 13,040

QQQ             6257; 6165

Resistance QQQ         6350; 6417                     

Nasdaq          2829; 2775

Resistance Nasdaq      2883; 2937

 

CYCLES

Cycles suggest both strength and weakness early in the week, a mid-week high and a steady to soft end of week.

 


Rule 17B requires disclosure of payment for investor relations*

Princeton Research has received about $ 2,500 per month from Lucas ( LEI ) marked with an asterisk.    Princeton has been paid for investor relations in the past and has negotiated a contract to be paid 100,000 restricted shares from Leo Motors ( LEOM ). In addition Princeton has bought shares. Cross Border paid us 25,000 restricted shares several months ago. We do not currently represent Cross Border but we like the company. We own about 3,000 shares. Princeton has 2,281,578 shares of AIVN.

 

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 shares in companies it represents at any time.

 

CONTACT

Please Direct All Inquiries To:

Mike King

Princeton Research

3887 Pacific Street, Las Vegas, Nevada 89121

Phone: (702) 650-3000

Fax: (702) 697-8944

mike@princetonresearch.com

Visit: www.princetonresearch.com

 

 

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