Market 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. (http://www.princetonresearch.com/)

 

 March 12, 2012

Market Strategies Guide to Successful Trading

 

To Read The Market Investing Strategies Newsletter In Adobe PDF Version – CLICK HERE

http://www.princetonresearch.com/3-12-2012-Market-Strategies.pdf

 

 

To subscribe to the Options Only Acct Trades simply TEXT the word UPDATES to 69302

and you will automatically be included.

 

$10,000 OPTIONS ONLY ACCT:

 

New Trades for this week:

BUY  6 LMT  April 90 CALLS @ $1.35        

BUY 4 AMZN  March 185 CALLS @ $2.20     

BUY 10 SNTS  May 5 CALLS @ $ .35          

BUY 6 ALEX  April 45 PUTS @ MKT         

 

The $10,000 Options Only account had a Gain last week of $1,450, increasing our gains for the year from $3,743 to $5,193.

 

One position remains: The SPY March 137 Puts.

The Open positions are highlighted in the options table below.  Approximately $ 642 funds are in use.

This was a good week for the Options Only account.  We now stand at a YTD increase of just over 50%. 
As I’ve been saying for several weeks that the path of least resistance for “surprises” is the downside.
 We were in the position to make all of our profits on Tuesdays drop. This brought our “balanced” approach into practice.  We made money on two shorts, while also taking gains on MCD, a strong and defensive stock. While I am still bullish overall, this is not an investment account but rather a trading account.

The Greek issue “seems” to be over but remember that elections are around the corner and we have no clue about whether the necessary follow-thru will take place.  Syria and Iran/Israel is a problem that will only get worse.  The “rogue” soldier incident in Afghanistan can have many consequences.  
One more fly in the ointment is the last two years pattern of the market, jobs data, and treasury yields.  In each of these years we got off to a strong start for the first quarter and then spent the next six months in decline.  While it’s true that the 10 year yields were 2 to 3 times higher, it would be the direction and safety of the bonds that would become more attractive in relative terms. As always we continue to look for low-risk trades in both long and short positions to make trading profits…..CAM

Remember, these trades are based on your participation in the

TEXT MESSAGE TRADE ALERTS SERVICE TO RECEIVE ALL UPDATES.

TEXT the word UPDATES to 69302

To Get In Now

Previous closed out trades not listed here may be seen in the February, January and 2011 weekly newsletters. See past issues at http://www.princetonresearch.com/market-strategies-newsletter/

 

DATE	TRADE	PRICE	COST	PROCEEDS	RESULTS
3/9/	Bought  6 SPY March  137 PUTS	1.07	642
3/8	Sold 10 MCD April 105 Calls	.22		220	230 Loss
3/7	Bought 10 MCD April 105 Calls	.45	450
3/6	Sold 10 MCD March 100 Calls	1.11		1110	240 Gain
3/6	Sold  3 RCII March 35 Puts	2.00		600	330 Gain
3/6	Sold 5 SPY March  137 PUTS	3.30		1650	840 Gain
3/6	Sold  3 RCII March 35 Puts	1.80		540	270 Gain
3/5	Bought 10 MCD March 100 Calls	.87	870
3/1	Bought 5 SPY March  137 PUTS	1.62	810
2/21	Bought  6 RCII March 35 Puts	.90	540

New trades $ 10,000 account…In Texting we have a limited amount of words. In the interest of brevity: OPTIONS ONLY: 3 March, 4 April . 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

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

 Last week we bought CLWR and PDLI and we were stopped on QUIK

 

Buy 15,000 shares of AIVN at $ 0.28; stop close only at $ 0.10.*

Buy 200 LVLT at MKT

Buy 1000 SNTS at MKT

 

 Each stock is allocated a theoretical $ 5,000 share of the portfolio unless otherwise indicated.

Note: Previous closed out stock and option positions can be found in the March 5 and newsletters dating back to July 20, 2009.  Stay alert on the free texting service for new trades and exits.

 

 

Model Portfolio Comments/Changes:

 

                                    INDEX OPTION RECOMMENDATIONS

 

We are looking for a spot to buy the VXX but have no entry just yet. March should have a lot of volatility.

 

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 TZA, 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
BUY 12 LMT April 90 CALLS  at  $1.35        

BUY 8   AMZN March 185 CALLS at $2.20     

BUY 6   ALEX April 45 PUTS at MKT         

 

 

Option and overall Comments

We had a Gain last week of $2,244 in a mixed week. Our gain for the year was $10,863 and with last week’s Gain has increased to $13,107.  We have Two long options positions remaining, the CSCO Jan 20 Calls and SPY March 137 Puts. The stock table includes thirteen long stock positions: CLWR, PDLI, CISG, DZZ, ANX, ABR, PKRK, DVR, AEZS, LEI, LEOM, XBOR (a double) and SDS. The SDS is a double inverse SP500 ETF, DZZ is a double inverse Gold ETF.

 

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 $1,525 in the
options positions and $ 60,530 in the 13 long stock positions for a total of $ 62,055 with $ 37,945 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

• Text UPDATES to 69302.
• 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.

 

 

 

Note: Previous closed out stock and option positions can be found in the March 5 and newsletters dating back to July 20, 2009.                                                                                                       

                                                                     

                                This Weeks’ Economic Numbers and Media Data

 

Economic Data

 

The unemployment report was nothing sensational with Payrolls coming at 233K , better than the 220K expected, but below the 285K last month. It was nonetheless a bullish relief to many traders who had bought puts as protection, hedging the possibility of a negative report. The Unemployment Rate remained at 8.3%. Hourly Earnings grew at just a 0.1% rate, just half of expectations and fourth quarter productivity was revised up 0.9% better than the 0.8% predicted.

 

Little attention was paid to the negative January Trade Balance which increased to -$ 52.6 billions, well above the – 48.2 b last month, which was horrible enough. This is the real killer to the economy and will be a deduction from the GDP estimate for the quarter b( 1^st QTR GDP )  when released next quarter. Many jobs are not being filled, especially in the energy sector because of the unavailability of skilled labor.

 

Hourly Earnings grew at just a 0.1% rate, just half of expectations and fourth quarter productivity was revised up 0.9% better than the 0.8% predicted.

 

Fundamentals (previous letters may be seen at www.princetonresearch.com)

 

Equities rallied for the third consecutive week, ninth out of the last ten probably on confirmation from the jobs report that the economy continues to grow. The Put/Call ratio gained 15 Puts last week to a 170 Puts/Calls. ( 75 Puts/Calls is considered bullish.) The large amount of Puts supports sell-offs. Certainly, the abundance of bears adds support on sell-offs. 

 

The markets began the week selling off on the China news that their economy grew just 7.5%. The bad news caused a sharp sell-off that became just another buying opportunity, especially Apple  and Apple Calls. Eight of the ten Dow Industrial groups were slightly higher. Consumer Services was best up just 1.30% followed by Telecommunications, plus 1.02 % and Utilities 0.71%. Only Oil and Gas -0.87%, and Basic Materials off 2.05% were lower.

 

 

Technical Information

 

      Support Levels:   S&P 500           1361; 1346                  Resistance S&P 500   1377; 1383

                                        DOW            12,890 12,740              Resistance DOW        13,040; 13,100

                                        QQQ             6430; 6350                  Resistance QQQ          6577; 6659                     

                                       Nasdaq          2972; 2928                   Resistance Nasdaq     3036; 3092                                          

                                    

                      CYCLES

 

The Fed Chairman is speaking Wednesday following the FOMC announcement Tuesday. While no rate change is expected you can expect him to have a moderating hawkish interest rate outlook to dampen the effect of any large rally. Conversely, if the markets are much lower he might talk the other way leaving hope for monetary expansion. Keep an eye on the VXX. The volatility index will bottom when the rally fizzles. There is no such signal just yet.

 

The S&P 500 made a gain of 0.1% making the ninth week of gains out of the last 10. March has had a slow follow through from the positive action of the past two months; Nothing wrong with that.
The positive February performance followed January’s gains and added a new twist to analysis that begun last week in a blog titled Top 10 S&P 500 New Year Starts that was subsequently followed by the Top 15 DJIA New Year Starts. If Apple (AAPL) was a DJIA component, undoubtedly, the DJIA would be performing much better than its current lagging 6.0% year-to-date performance as of the close of February trading.

In the tables and charts below the top performing years have been compiled to illustrate what has happened in the past when both January and February were positive and the combined gain for the two months was at least 5%. There are just two exceptions to these criteria, one for NASDAQ and one for the Russell 2000. In order to include 2011 and 1989 respectively, the 5% rule was relaxed, slightly. This was done to expand the dataset with modern era data.

 

 

 

          

 

 

 

 

 

                    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. In addition Princeton has bought shares. Princeton is paid by Baron Energy ( BROE ) to do investor relations in the amount of 300,000 shares. Princeton has also bought separate shares about 327,600 and owns the shares for its own account. AIVN is merging with Placer Gold of which Princeton or its principal owns shares and is a director. Cross Border paid us 25,000 restricted shares several months ago and we bought and own another 25,000 purchased at higher prices.

 

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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