November 14, 2011, Market Strategies Guide to Successful Trading

Special Note:
Charles Moskowitz appeared for an interview at StockLegends.com. The Show aired on Monday November 7th at 10:00 AM at http://www.stocklegends.com , we urge everyone to listen to the interview now available on our website at:

http://www.princetonresearch.com/princeton-research-featured-on-investment-news-show/

We have been asked to help those who do not wish to make a $100,000 commitment to an account to scale back the initial investment to a $10,000 account.

We are answering this request with an account that will only trade options. However, in order to take full advantage to this new account, you really need to also subscribe to our Texting service. There is no cost involved, but in order to receive all of the trading suggestions, in a high volatility environment, we need to communicate more often than weekly.

To subscribe, simply TEXT the word UPDATES to 69302

and you will automatically be included.

$10,000 OPTIONS ONLY ACCT:

New Trades for this week:

BUY 2 AAPL 12/ 400 @ $6.00 OB

BUY 5 TLT 12 /118 CALLS @ $1.65 OB

The $10,000 Options Only account made $ 721 last week, its twenty fourth week of trading.

We came into the week with a balance of $11,759.00 and with the Gain last week increased the gains to $12,480.00.

Three positions remain:

the JAZZ Nov 36 Puts,

BAC Dec 6 Calls and

TZA Nov 32 Calls.

The Open positions are highlighted in the options table below.

 

Approximately $ 2260 funds are in use. Italy raced to the edge with interest rates on debt skyrocketing from 6.3% to 7.5% and then coming back to reality by Friday. It became clear that Italy is NOT Greece and that they have the means to make the changes needed. This week was slightly (6%) positive for the Options account as the S & P had a range of 50 points and closed up 10. Ideally a small pullback to the 1245-1250 would be a great spot to get a bit more long of the “high-performance” stocks that the lagging hedge funds will need to make up for their under-performance. This may include the under-owned financials as well as Tech and some of the seasonally sensitive retailers….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 November 7, October 31, October 24, October 17, October 10, October 3 and September 26 issues.

 

 

DATE

TRADE

PRICE

COST

PROCEEDS

RESULTS

11/11

Bought 5 TZA November 30 Calls

1.28

640

11/11

Sold 20 ZSL November 13 Calls (50% Rule)

.15

300

(400)

11/11

Sold 15 IBM November 190 Calls

.62

930

270

11/10

Sold 4 JEF December 12 Calls (50 % Rule)

.90

360

(360)

11/10

Bought 20 ZSL November 13 Calls

.35

700

11/10

Sold 20 ZSL November 12 Calls

.50

1000

300

11/9

Bought 15 IBM November 190 Calls

.44

660

11/8

Bought 20 ZSL November 12 Calls

.35

700

11/8

Sold 5 APA November 105 Calls

2.00

1000

310

11/7

Bought 5 APA November 105 Calls

1.38

690

11/7

Sold 5 TLT November 117 Calls

2.60

1300

445

11/7

Sold 4 TZA November 32 Calls

2.32

928

156

11/7

Bought 10 BAC December 6 Calls

.75

750

11/7

Bought 5 TLT November 117 Calls

1.71

855

11/4

Bought 4 TZA November 32 Calls

1.93

772

11/3

Bought 4 JEF December 12 Calls

1.80

720

11/2

Bought 6 JAZZ November 36 Puts

1.45

870

 

New trades $ 10,000 account…In Texting we have a limited amount of words. In the interest of brevity: OPTIONS ONLY: 11 November; 12 December; 1 January:
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

12,153.68

+170.44

+1.42%

Nasdaq

2678.75

-7.40

-0.28%

S&P 500

1263.85

+10.62

+0.93%

Transportation

4977.98

+65.81

+1.34%

Russell 2000

744.64

-1.85

-0.25%

Nasdaq 100

2355.78

-0.54

-0.00%

Gold

1788.10

+32.00

+1.8%

Silver

3408.4

+59.0

+1.8%

Crude

98.99

+4.73

+5%

Heating Oil

317.16

+10.09

+3.29%

Unleaded Gas

2.6634

-0.0596

-2.24%

Natural Gas

3.584
-0.199 -5.2%

VIX

30.04

-0.12

-0.4%

Put/Call Ratios

S&P 100

165/100’s

-37/100’s

Put/Call Ratios

CBOE Equity

73/100

-3/100’s

Bonds

140-14 -0-18

3.11% +0.01%

10 Yr Note

129-25 -0-15 2.06% +0.03%

Copper

346.35

-10.10

-2.8%

CRB Inflation

Index

320.20

-0.24

-0.09%

Barron’s Confidence

68.7.%

+0.4%

S&P100

567.79

+5.82

-1.04%

5 Yr Note

122-25 -0-11

.90% -0.01%

Dollar

76.91

0.00

0.00%

DJ Utilities

452.91

+1.74

+0.38%

AAII

Confidence

Index

Bullish

44.7

+4.6%

Bearish

24.6

-5.1%

Neutral

30.7%

+0.5 %

M1 Money Supply

+20.1%Oct 31st

M-2 Money.

Supply

+9.2%Oct 31st

 

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 FCH, CDTI, USPR*(half position) and JVA, we were stopped out on JVA.

(A full position is $5,000)

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)

USPR *
20,000

.13
half pos.

11/09/11

JVA 500

11.13

11/7/11

9.49X

9.49 11/10 stopped

($820)

CDTI 1200

3.30

11/7/11

2.75 sco

FCH 1300

3.41

11/711

2.79X

CONN 500

8.50

10/25/11

7.49X

BBVA 600

8.79

10/25/11

5.50X

FTWR 5000

.96

10/24/11

.48x

SDS 100

25.55

10/5/11

XBOR*

1.40

8/12/11

0.70sco

LEI*

2.06

8/10/11

1.03x

KAJMY

30.45

3/21/11

29.60 sco

LEOM*

0.30

12/17/10

0.07sco

 

Previous closed out positions can be found in the November 7, October 17, October 3, September 19, September 6th, August 15th, August 8th, August 1st and July 18th letters.

 

 

 

Model Portfolio Comments/Changes:

 

INDEX OPTION RECOMMENDATIONS

Buy 10 SPY December 125 calls @ 2.50
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 and SDS, whichgo up when the DOW and S&P 500 go down and down when they go up.

 

New Stock Option Recommendations

 

1. Buy 14 DD January 49 Calls @ 1.75
2. Buy 10 LULU December 55 Calls @ 2.50
3. Buy 10 MMM January 85 Calls @ 2.25
4. Buy 4 AAPL December 400 @ $6.00 OB

5. Buy 10 TLT December 118 CALLS @ $1.65 OB
Option and overall Comments

 

We had a gain last week of $ 442 in a volatile week. Our gains for the year increased to $ 78,640.

 

We have four long options positions remaining, the ORCL Calls JAZZ Calls, BAC Calls, TZA Calls. TZA is a triple inverse Small Cap ETF. The stock table includes eleven long stock positions: FCH, USPR, CDTI, CONN, BBVA, FTWR, LEI, KAJMY, LEOM, SDS and XBOR. The SDS is a double inverse SP500 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 an hypothetical $ 100,000.00 and are using $10,000 in the options positions and $ 50,000 in the eleven long stock positions for a total of $ 60,000 with

$40,000 in cash. This is our 42nd letter for 2011. These figures are approximate. We do not count commission costs and there may be errors. If the suggested stocks and options are executed another $ 15,000 would be in use.

 

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

To Get Instant Trade Alerts 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)

at the close the previous Friday or at the open on Monday.

  • The options will be followed until closed out.
  • Option Symbols have changed. We will now use a new terminology. ( 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)

TZA Nov 30
10 Lots
Calls 1.28

11/11/11

ORCL Dec 32
20 Lots
Calls 1.25

11/10/11

ZSL Nov 13
40 Lots
Calls .35

11/10/11

.15 (50% rule)

11/11/11 ($ 800 )
IBM Nov 190
30 Lots
Calls .44

11/09/11

.62

11/11/11 $ 540
ZSL Nov 12
40 Lots
Calls .35

11/08/11

.50

11/10/11 $ 600
APA Nov 105 10 Lots Calls 1.38

11/07/11

2.00

11/08/11 $ 620
TLT Nov 117 10 lots Calls 1.71

11/07/11

2.60

11/07/11 $ 890
BA Dec 6
25 lots
Calls .75

11/07/11

TZA Nov 32

8 lots Calls 1.93

11/04/11

2.32

11/07/11 $ 312 JEF Dec 12
10 lots
Calls 1.80

11/03/11

.90

11/10/11 ( $ 900 )JAZZ Nov 36
12 lots
Puts 1.45

11/02/11

CSCO Jan 20 2012 Put short; longJan20;2013 CallPut/Call Spread 0.07 2/14/11

 

 

Note: Previous closed out stock and option positions can be found in the November 7, October 17, October 3, September 19, September 6, August 22, August 8, August 1, July 18, July 11, July 5, June 20, May 16, April 25, April 11, March 21, March 14, March 7, February 21, 2011 February 7, 2011 January 24, 2011, December 20,2010, November 22, 2010, October 11, 2010, September 13, 2010, July 26, 2010, June 14, 2010, May 10, 2010, January 25, 2010, November 23, October 23, August 24, July 20, 2009 newsletters.

 

This Weeks’ Economic Numbers and Media Data

 

Monday Italy taps the bond market again; sells 1.5 billion Euros of 5-yr bonds.

Tuesday08:30 hrs PPI for October ( -0.2% vs 0.8% )

CORE PPI ( 0.1% vs 0.2% )

08:30 hrs Retail Sales Oct ( 0.4% vs 1.1% )

Ex-Auto Oct ( 0.2% vs 0.6% )

08:30 hrs Empire State Manufacturing for Nov ( 0.0 vs -8.4% )

10:00 hrs Business Inventories Sept ( 0.1% vs 0.5% )Wednesday07:00 hrs MBA Mortgage Purchase Index 11/05 ( NA vs + 10.3% )

08:30 hrs CPI October ( 0.0% vs 0.3% )

CORE CPI ( 0.1% vs Same )

09:00 hrs Net Long term TIC Flows Sept ( NA vs $ 57.9B )

09:15 hrs Industrial Production Oct ( 0.4% vs 0.2% )

Capacity Utilization ( 77.6% vs 77.4% )

10:00 hrs NAHB Housing Market Index Nov ( 18 vs 18 )

10:30 hrs Crude Inventories 11/12 ( NA vs -1.370Mln bbls )Thursday08:30 hrs Initial Unemployment Claims 11/12 ( 400K vs 390K )

08:30 hrs Continuing Claims 10/29 ( 3648K vs 3615K )

08:30 hrs Housing Starts Oct ( 603K vs 658K )

08:30 hrs Building Permits Oct ( 603K vs 593K

10:00 hrs Philadelphia Fed Nov ( 7.5 vs 8.7 ) Friday

10:00 hrs Leading Economic Indicators Oct ( 0.6% vs 0.2% )

 

 

Economic Data

Economic numbers continue to impress: Consumer credit rose to $ 7.4Bln, a substantial improvement in spending patterns, while unemployment claims fell to 390K.

The balance of trade figure last week ( on Thursday for September ) was outstanding at -$43.1B, an improvement of $2.8B from August. A $ 45.9 B deficit had been widely expected. Even the Treasury Budget came in $ 6.5 Billion less in the red. The treasury posted a deficit of $ 98.5 B, while a $ 105B deficit was expected.

The University of Michigan posted its preliminary Consumer Sentiment Survey for November and it improved to 64.2 from 60.9 in October.

 

This week has a heavy calendar ( see above table ) and will likely continue to favor the bulls.

 

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

 

Stocks surged late in the week on dollar weakness making the fourth weekly gain out of the last five.

Eight of the ten Dow Industrial groups closed higher led by Health Care, up 1.96%. Oil and Gas followed with a 1.05% rise. Telecommunications rose 1.01%; Consumer Services gained 0.99%; Utilities 0.45%; Consumer Goods gained 0.41%; Industrials were up 0.36%; Technology 0.12%. There were two small losers on the week: Financials fell 0.23% and Basic Materials lost 0.66%.

 

Earnings season, while winding down, was mostly positive. Cisco ( CSCO: $ 19.02 ) up 5.7% on the week, bested expectations. General Motors (GM: $ 22.51 ) – 4.7% bested expectations but gave negative forward guidance.

 

Concerns about Italy, which helped cause the huge drop last Wednesday, were mostly alleviated when they apparently showed a unified political front. The replacement in Greece of former prime minister Papandreau by Papademos was received well by the market since the former prime minister had proposed a referendum on Greece debt which caused a Euro slide/ Dollar strength and market debacle last Wednesday. The dollar made a mirror image down move Thursday followed by a Friday follow-through to just above the 200-day moving average. This action of the weak dollar helped equities.

 

 

Technical Information

 

Support Levels: S&P 500 1238; 1203 Resistance S&P 500 1274; 1304

DOW 12,030; 11,820 Resistance DOW 12,320; 12,530

QQQ 5729; 5640 Resistance QQQ 5855; 5957

Nasdaq 2663; 2612 Resistance Nasdaq 2724; 2775

CYCLES

 

Short term cycles this week suggest a sideways market this week, with weakness likely later in the week that can used as a buying opportunity to accumulate longs. Historically Early November price levels are maintained or exceeded at the end of November.

 

 

 

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. 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. USPR paid us 200,000 restricted shares. Cross Border paid us 25,000 restricted shares and we bought and own another 25,000 purchased at higher prices.

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